ADMINISTRATIVE

Enclosed are the Locality Ledger and spreadsheets that reflect 
the cash basis and the modified accrual basis of accounting for 
sales tax revenue and basic aid payments for the school year 
1997-98.  This Departmental information represents payments 
made to localities from state and federal funds and should be 
reconciled to  your accounting records prior to preparing the 
1997-98 Annual School Report.

Also, enclosed are a set of forms, a diskette, and instructions 
for compiling data for the Annual School Report.  The modified 
accrual basis of accounting is to be used for preparing the 
financial section.

In keeping with the Commonwealth's goal of efficiency in 
government, the Department is requesting school divisions to 
submit the financial section on the enclosed diskette and also 
to provide a printed copy of the diskette.  Submitting the 
financial section on diskette will reduce processing time by 
approximately one-third.  Complete diskette instructions are 
included in this package.

The 1997-98 Annual School Report is due by August 15, 1998, as 
required by Section 22.1-81, Code of Virginia.  An automatic 
15-day extension is granted if needed.  Further extensions are 
precluded by the referenced Code section.

Please send the diskette and printed copy, or the original
financial section, as well as all supplemental schedules to:


                  L. M. Morgan, Jr.
                  Accounting & Finance
                  Department of Education
                  P. O. Box 2120
                  Richmond, Virginia  23218-2120

Questions relating to the Annual School Report and supplemental 
schedules should be directed to the following:

Financial Section and
Full-time Equivalent
(FTE) Positions        Mr. L. M. Morgan, Jr.   (804) 225-2040

Special Education      Mr. John Mitchell       (804) 225-2704

School Nurse             
Health Care Cost       Mr. Kent Dickey         (804) 225-2806

Pupil Transportation   Dr. Barbara Goodman     (804) 225-2774


PDS:da

Enclosures:     A hard copy of this memo and its attachments
                will be sent to the superintendent's office.