Missouri Senate

Senate Committee Substitute

STATE AUDITOR - 21.760 to 29.340, 50.1030 to 169.020, & Section 1

This act modifies the duties and authority of the State Auditor.

The act specifies that the types of audits that may be conducted by the State Auditor shall include financial and performance audits. The standards established by the comptroller general of the United States for audits of government entities, organizations, programs, activities, and functions as published in Government Auditing Standards shall determine the type of audit to be conducted and a mixture of audit type and objective may be used. The objectives of financial and performance audits are enumerated.

This act provides that the Auditor may only conduct financial audits of the General Assembly.

The Auditor may conduct audits at his or her discretion, as deemed necessary, without advanced notice instead of on a scheduled basis. The Auditor may only audit the General Assembly during the legislative interim between a first regular and second regular session of the General Assembly. The treasury shall be audited at least annually.

The Auditor may contract with federal audit agencies or government agencies on a cost reimbursement basis to audit federal grant programs.

The Auditor may examine records of financial institutions relating to transactions with the State Treasurer, a state agency, or any political subdivision.

The Auditor may review bookkeeping and accounting systems used in state agencies and determine the propriety of the data presented in the state comprehensive annual financial report.

Any instances of statutory violations and malfeasance, misfeasance or nonfeasance by officers or employees shall be provided in a report to the Governor and Attorney General.

Draft reports of audits shall be delivered to and discussed with the auditee's official and any written response shall be provided within 30 of receipt of the draft.

The General Assembly, Governor, and director of each agency audited shall be notified of the publication of an audit report.

Audit report records shall be retained in accordance with the state record's retention schedule. Related material shall be retained pursuant to an agreement between the Auditor and the state archives.

The Auditor may audit any public employee retirement or health care system.

A method by which the Auditor shall receive reports of allegations of improper governmental activities is established. The Auditor may investigate such reports and refer matters outside of the scope of the Auditor's authority to the proper authorities.

The Auditor shall have access to all documents and files of any agency or institution it is authorized to audit. Review of tax returns shall be limited to matters of official business and remain confidential except that the Auditor may disclose information related to overdue tax debts.

The Auditor shall have access to all documents, files, property and facilities of any organization that pertain to money received or handled from the federal government, the state or any political subdivision.

Banks and financial institutions are not required to produce records until they are reimbursed for reasonable document production costs.

The Auditor shall comply with state and federal financial privacy requirements prior to accessing financial records.

Grants and contracts entered into by state agencies and political subdivisions shall include a clause describing the Auditor's access to records.

The Auditor may contract for professional services to carry out audits.

Willfully making false, misleading or unfounded reports for the purpose of interfering with an audit, review or investigation or obstructing the Auditor constitutes a class A misdemeanor.

Currently, the Auditor conducts biennial audits of the Missouri county employees' retirement system. Under the act, the system's board is charged with conducting the audits through a certified public accountant or a firm of certified public accountants.

Currently, at least once every three years, the Auditor examines audits of the prosecuting and circuit attorneys' retirement system, the Missouri local government employees' retirement system, the Missouri consolidated healthcare plan, the Missouri department of transportation and highway patrol employees' retirement system, the Missouri state employees' retirement system, and the public school retirement system. These provision are repealed and the Auditor may audit these systems at any time.

A provision prohibiting examiners from receiving or riding on free transportation while on official business is repealed.

This act allows the Auditor to audit a community action agency. The term "community action agency" is defined under the act.

These provisions are similar to HCS/HB 543 (2013), SB 65 (2013), and HB 2106 (2012).

AUDITS OF CERTAIN COUNTIES - 50.055 & 50.057

Under current law, the accounts of any second class county may audited every odd-numbered year within 6 months after the county commission determines an audit is desirable or necessary. This act provides that the accounts of any second class county and the accounts of any county office may audited at any time the commission determines an audit to be desirable or necessary.

Current law provides that the audit must review the receipts, disbursements, and property inventory of every county office that receives or disburses money on the county's behalf or holds county property. This act specifies that, unless the audit is requested for a particular office, the audit may review such records and inventory.

This act repeals a provision requiring the auditor to provide, along with the audit report, a statement showing the receipts and disbursements of the county during the period of the audit.

If the state auditor performs an audit for a second or first class county, this act requires the county to reimburse the state auditor for all expenses incurred, including staff salaries. The payment is to be deposited in the "Petition Audit Revolving Trust Fund".

COUNTY BUDGET DECREASES - 50.622

This act allows and establishes procedures for counties to decrease their annual budgets no more than twice each fiscal year when faced with an unanticipated decline in funding of two percent or greater.

The budget reduction may not affect any one independently elected officeholder unless all officeholders who receive funds from the same budget category have negotiated ways to cover the shortfall. Also, the reductions may not impact any dedicated fund created by law.

These provisions expire on July 1, 2016.

Charter counties may follow procedures in their charters for amending their budgets rather than the provisions of this act.

This provision is identical to SB 137 (2013), a provision of HCS/SCS/SB 692 (2012), SS/SCS/HCS/HB 1623 (2012) and HCS/SCS/SB 729 (2012), and is similar to a provision of HCS/HB 1373 (2012), HB 1573 (2012), HB 1307 (2012), HCS/SS/SCS/SB 580 (2010) and HB 1793 (2010).

AUDITS OF TRANSPORTATION DEVELOPMENT DISTRICTS - 238.272

Under current law, the Auditor must audit each Transportation Development District at least once every three years and may audit more often as the Auditor deems appropriate. The district must pay the costs of the audit.

Under this act, the Auditor may audit each district not more than once every three years. The provision allowing the Auditor to audit more frequently is repealed. This act provides that the costs of the audit shall not exceed the greater of three percent of the gross revenues received by, or the expenditures made by, the district.

This provision is similar to HB 909 (2013).

MEGHAN LUECKE