State SealARIZONA HOUSE OF REPRESENTATIVES


 

HB 2677: JLAC; auditor general

PRIME SPONSOR: Representative Kern, LD 20

BILL STATUS: Appropriations

 

 

Overview

☐ Prop 105 (45 votes)	     ☐ Prop 108 (40 votes)      ☐ Emergency (40 votes)	☐ Fiscal NoteMakes various changes to Auditor General and Joint Legislative Audit Committee processes. Requires the Auditor General to conduct an audit on a county transportation excise tax in the fifth year in which the transportation excise tax takes effect, instead of the tenth year. Revises factors in determining the need for continuation or termination of an agency for purposes of sunset review reports.

History

The Arizona Auditor General is appointed by the JLAC, subject to approval by concurrent resolution of the Legislature, to perform sunset, performance, special and financial audits and investigations.

The Joint Legislative Audit Committee is charged with overseeing all audit functions of the Legislature and State agencies and requiring State agencies to comply with audit findings and directions. The committee consists of 5 members of the House of Representatives, appointed by the Speaker of the House, 5 members of the Senate, appointed by the President of the Senate.

Federal law requires an annual audit of a non-Federal entity that expends more than $750,000 in Federal assistance during the fiscal year, with certain exceptions (2 CFR § 200).

Provisions

 

Auditor General Powers and Duties

1.       Allows the Auditor General to attend executive sessions when conducting an audit authorized by law, instead of only those related to school districts and state agencies. (Sec. 4)

2.       Clarifies that the Auditor General may attend executive sessions of meetings when those meetings are authorized pursuant to public meeting law. (Sec. 4)

3.       Instructs the Auditor General to follow requirements prescribed by the Department of Public Safety when disclosing information about an employee's criminal history to members of the Auditor General's staff for purposes of employment of personnel by the Auditor General. (Sec. 2)

Auditor General Investigations

4.       Requires the Auditor General, as resources allow, to investigate allegations of financial impropriety, malfeasance or nonfeasance in any of the following circumstances:

a.       In connection with an audit authorized by law;

b.       On request of a public officer of a state agency or political subdivision on matters under the supervision or control of that public officer; and/or

c.        On request of a sheriff, county attorney, municipal attorney or the attorney general in connection with an open investigation on matters under the supervision or control of the attorney general, that sheriff or municipal attorney. (Sec. 3)

 

Access to Records

5.       Requires all officers in any state agency, board, commission, department, institutions, program, advisory council, committee, political subdivision and contractors with the state to afford reasonable and needed facilities for the Auditor General and make records available in the form and at the time prescribed. (Sec. 4)

6.       Makes knowingly obstructing or misleading the Auditor General a class 2 misdemeanor. (Sec. 4)

7.       Requires the Attorney General to supervise the prosecution of offenders refusing or failing to provide access to and examination of records. (Sec. 4)

8.       Repeals duty of local officers to make county, community college and school district records available (Sec. 9).

Reporting Requirements

9.       Eliminates the requirement that the uniform expenditure reporting system include a county's reconciliation of expenditures reported within financial statements to the expenditure limitation report. (Sec. 6)

10.   Removes the requirement that the expenditure information, exclusions from local revenues and expenditures subject to the expenditure limitation in the county annual expenditure limitation report be by fund. (Sec. 6)

11.   Eliminates the requirement that the Auditor General provide an annual summary of activities of the previous fiscal year to the Governor and the Joint Legislative Audit Committee. (Sec. 3)

Federal Single Audit

12.   Requires the Auditor General to conduct or cause to be conducted annual financial and compliance audits of state agencies subject to the Federal single audit requirement, instead of every other year. (Sec. 3)

13.   Eliminates the requirement that the Auditor General conduct or cause to be conducted an annual compliance audit for all counties and instead, for a county that is subject to the Federal single audit requirement:

a.       Requires compliance audits of financial transactions and applicable accounts kept by or for the county; and

b.       Requires the audit to be conducted in accordance with Generally Accepted Governmental Auditing Standards; and

c.        Requires the inclusion of tests of the accounting records and other auditing procedures as may be considered necessary under the circumstances. (Sec. 8)

14.   For a community college district subject to the Federal single audit requirement:

a.       Requires compliance audits of financial transactions and applicable accounts kept by or for the community college district; and

b.       Requires the audit to be conducted in accordance with Generally Accepted Governmental Auditing Standards; and

c.        Requires the inclusion of tests of the accounting records and other auditing procedures as may be considered necessary under the circumstances. that a county required to comply with the Federal single audit requirements. (Sec. 8)

 

 

 

School District Audits

15.   Requires audited school districts to submit written status reports to the Auditor General at the request of the Auditor General within the two-year period following the issuance of an audit, instead of every six months for two years. (Sec. 3)

16.   Requires the Auditor General to provide status reports of a school district's progress in implementing audit recommendations to the Joint Legislative Audit Committee within the two-year period following the issuance of an audit, instead of every six months for two years. (Sec. 3)

17.   Removes the requirement that the school district performance audits include a determination of whether school districts that receive monies from the Structured English Immersion Fund follow statutes regarding English language education for children in public schools. (Sec. 3)

County Transportation Excise Tax Audits

18.   Advances the first Auditor General audit on a county transportation excise tax from the tenth year to the fifth year in which the transportation excise tax takes effect. (Sec. 3)

 

19.   Instructs the County Treasurer of a county with an approved country transportation excise tax to cooperate with and provide necessary information to the Auditor General. (Sec. 3)

20.   Requires the County Treasurer to reimburse the Auditor General's Audit Services Revolving Fund from transportation excise tax revenues for the costs related to conducting a performance audit of a county transportation excise tax. (Sec. 3)

21.   Lists monies received from Federal audits of Federal funds, country excise tax performance audits and any other source authorized by statute as sources of revenue in the Audit Services Revolving Fund. (Sec. 5)

Sunset Review Reports

22.   Revises factors in determining the need for continuation or termination of an agency during sunset review reports. (Sec. 10)

23.   Modifies information provided by the agency in the final sunset review report. (Sec. 10)

Miscellaneous

24.   Requires Joint Legislative Budget Committee staff to notify the Legislature of the cost to conduct a special audit prior to the legislative measure mandating the special audit being scheduled for third read in the House in which the special audit provision was added or before final passage if the special audit was added in conference committee. (Sec. 3)

25.   Defines pertinent terms. (Sec. 1)

26.   Makes technical and conforming changes.

 

 

 

 

 

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Fifty-fourth Legislature                       HB 2677

First Regular Session                            Version 1: Appropriations

 

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