Introduced Version
House Bill 2849 History
OTHER VERSIONS -
Committee Substitute
|
Engrossed Version
|
| Email
Key: Green = existing Code. Red = new code to be enacted
H. B. 2849
(By Delegates Boggs, Swartzmiller, Ferro,
Caputo and D. Poling)
(By Request of the State Auditor)
[Introduced March 6, 2013; referred to the
Committee on Government Organization then the Judiciary.]
A BILL to amend and reenact §6-9-7 and §6-9-9a of the Code of West
Virginia, 1931, as amended; and to amend said code by adding
thereto a new section, designated §6-9-9b, all relating to
audits and investigations by the chief inspector of public
offices; clarifying that the chief inspector may also
investigate, in addition to examine, the financial affairs of
local governmental offices or political subdivisions and
boards, commissions, authorities, agencies and other entities;
clarifying that the chief inspector may also initiate civil
and criminal actions if an investigation discloses
misfeasance, malfeasance or nonfeasance; providing for
confidentiality of reports and working papers of the chief
inspector division; and defining a term.
Be it enacted by the Legislature of West Virginia:
That §6-9-7 and §6-9-9a of the Code of West Virginia, 1931, as amended, be amended and reenacted; and that said code be amended by
adding thereto a new section, designated §6-9-9b, all to read as
follows:
ARTICLE 9. SUPERVISION OF LOCAL GOVERNMENT OFFICES.
§6-9-7. Examinations and investigations into affairs of local
public offices; penalties.
(a) The chief inspector has the power by himself or herself,
or by any person appointed, designated or approved by the chief
inspector to perform the service, to examine or investigate, or
both, into all financial affairs of every local governmental office
or political subdivision and all boards, commissions, authorities,
agencies or other offices created under authority thereof. An
examination shall be made annually, if required, to comply with the
Single Audit Act and when otherwise required by law or contract.
When that act does not apply, unless otherwise required by law or
by contract, the examination shall be made at least once a year, if
practicable. Furthermore, the chief inspector shall furnish
annually to the Legislature a list of each local government office
or political subdivision and all boards, commissions, authorities,
agencies or other offices created under authority thereof and the
year of its most recent completed audit.
(b) When required for compliance with regulations for federal
funds received or expended by county boards of education the chief
inspector or his or her designee, including any certified public accountant approved by the chief inspector shall conduct and issue
an audit report within the time specified in controlling federal
regulations. Examinations of other local governments shall be
conducted and audit or review reports issued in accordance with
uniform procedures of the chief inspector.
(c) A county board of education may elect, by May 1 of the
fiscal year to be audited, to have its annual examination performed
by a certified public accountant approved by the chief inspector to
perform the examinations. When this election is made, a copy of
the order of the county board making the election shall be filed
with the chief inspector and the State Board of School Finance.
The county board of education is allowed to contract with any
certified public accountant on the chief inspector's then current
list of approved certified public accountants, unless the State
Board of School Finance or the prosecuting attorney of the county
in which the board is located timely submits to the chief inspector
a written request for the examination to be performed by the chief
inspector or a person appointed by the chief inspector, or the
chief inspector determines that a special or unusual situation
exists. The county board shall follow the audit bid procurement
procedures established by the chief inspector in obtaining the
audit.
(d) The chief inspector shall, at least annually, prepare a
list of certified public accountants approved by the chief inspector to perform examinations of local governments. Names
shall be added to or deleted from that list in accordance with
uniform procedures of the chief inspector. When each list or
updated list is issued, the chief inspector shall promptly file a
copy of the list in the State Register and send a copy to the State
Board of Education, the State Board of School Finance and to local
governments who request a copy.
(e) A county board of education, when procuring the services
of a certified public accountant on the chief inspector's list,
shall follow the procurement standards prescribed by the grants
management common rule, OMB Circular A-102 "Grants and Cooperative
Agreements with State and Local Governments" in effect for the
fiscal year being examined, or in any replacement circular or
regulation of the office of management and budget and in addition
shall follow those standards as determined by the office of chief
inspector.
(f) The approved independent certified public accountant
making examinations under this section shall comply with
requirements of this section applicable to examinations performed
by the chief inspector, including applicable requirements of the
federal government and uniform procedures of the chief inspector
applicable to examinations of county boards of education.
(1) Upon completion of the certified public accountant's
examination and audit or review report, the certified public accountant shall promptly send two copies of the certified report
to the county board of education who shall file one copy with the
Federal Audit Clearing House. The certified public accountant
shall send one copy of the certified report to the State Board of
School Finance, and one copy to the chief inspector.
(2) If any examination discloses misfeasance, malfeasance or
nonfeasance in office on the part of any public officer or
employee, the certified public accountant shall submit his or her
recommendation to the chief inspector regarding the legal action
the approved certified public accountant considers appropriate,
including, but not limited to, whether criminal prosecution or
civil action to effect restitution is appropriate, and three
additional copies of the certified audit report. After review of
the recommendations and the audit report, the chief inspector shall
proceed as provided in subsection (n) of this section. For
purposes of this section and section thirteen, article nine-b,
chapter eighteen of this code, a certified audit report of an
approved certified public accountant shall be treated in the same
manner as a report of the chief inspector.
(g) On every examination, inquiry shall be made as to the
financial conditions and resources of the agency having
jurisdiction over the appropriations and levies disbursed by the
office and whether the requirements of the Constitution and statutory laws of the state and the ordinances and orders of the
agency have been properly complied with and also inquire into the
methods and accuracy of the accounts and such other matters of
audit and accounting as the chief inspector may prescribe.
(h) If a local government office is not subject to a single
audit requirement under federal regulations or if it is not
otherwise required by law or contract to undergo an annual audit
and its expenditures from all sources are less than $300,000 during
the fiscal year the chief inspector may choose to perform either a
review or audit on the local government office and may in his or
her discretion determine the frequency of such review or audit.
(I) The chief inspector or any authorized assistant may issue
subpoenas and compulsory process, direct the service thereof by any
sheriff, compel the attendance of witnesses and the production of
books and papers at any designated time and place, selected in
their respective county, and administer oaths.
(j) If any person refuses to appear before the chief inspector
or his or her authorized assistant when required to do so, refuses
to testify on any matter or refuses to produce any books or papers
in his or her possession or under his or her control, he or she is
guilty of a misdemeanor and, upon conviction thereof, shall be
fined not more than $100 and imprisoned confined in jail not more
than six months.
(k) A person convicted of willful false swearing in an
examination is guilty of a misdemeanor and, upon conviction
thereof, shall be fined not more than $100 and imprisoned confined
in jail not more than six months.
(l) Except as otherwise provided in this section, a copy of
the certified report of each examination shall be filed in the
office of the commissioner, chief inspector with the governing body
of the local government and with other offices as prescribed in
uniform procedures of the chief inspector.
(m) If any examination or investigation discloses misfeasance,
malfeasance or nonfeasance in office on the part of any public
officer or employee, a certified copy of the report shall be
published electronically by the chief inspector with notice of the
publishing sent in writing to the proper legal authority of the
agency, the prosecuting attorney of the county wherein the agency
is located and with the Attorney General for such legal action as
is proper. At the time the certified audit report is published,
the chief inspector shall notify the proper legal authority of the
agency, the prosecuting attorney and the Attorney General in
writing of his or her recommendation as to the legal action that
the chief inspector considers proper, whether criminal prosecution
or civil action to effect restitution, or both.
(n) If the proper legal authority or prosecuting attorney, within nine months of receipt of the certified audit or
investigative report and recommendations, refuses, neglects or
fails to take efficient legal action by a civil suit to effect
restitution or by prosecuting criminal proceedings to a final
conclusion, in accordance with the recommendations, the chief
inspector may institute the necessary proceedings or participate
therein and prosecute the proceedings in any court of the state to
a final conclusion.
(o) A local government that is not a county board of education
may elect, by May 1 of the fiscal year to be audited, to have its
annual examination performed by a certified public accountant
approved by the chief inspector to perform the examinations. When
this election is made, a copy of the order of the governing body
making the election shall be filed with the chief inspector. An
electing local government is allowed to contract with any certified
public accountant on the chief inspector's then current list of
approved certified public accountants, unless the prosecuting
attorney of the county in which the local government is located
timely submits to the chief inspector a written request for the
examination to be performed by the chief inspector or a person
appointed by the chief inspector, or the chief inspector determines
that a special or unusual situation exists: Provided, That the
audit of a local government may be performed by the chief inspector at his or her discretion. The local government shall follow the
audit bid procurement procedures established by the chief inspector
in obtaining the audit: Provided, however, That the chief
inspector may elect to conduct the audit of a local unit of
government with one or more members of his or her audit staff
where, in the opinion of the chief inspector, a special or unusual
situation exists.
§6-9-9a. Public inspection of reports of examinations.
All reports of examinations and audits of public offices made
in accordance with the provisions of section seven of this article,
and the copies thereof, when filed in the office of the chief
inspector of public offices or in the office of the State Tax
Commissioner, shall be public documents and shall be available for
public inspection. However, if an examination or investigative
report discloses misfeasance, nonfeasance or malfeasance, the
report shall remain confidential until such time that the proper
legal authority, as described in subsection (m) of section seven of
this article, has completed its investigation and/or adjudication
of the matter.
§6-9-9b. Confidentiality of audit working papers of chief _
inspector.
_The audit working papers created by the chief inspector
division of the State Auditor's office during examinations or investigations are confidential and, therefore, are not public
records as that term is defined in section two, article one,
chapter twenty-nine-b of this code. "Audit working papers"
include, but are not limited to, the books and records of the
entity being audited, intra-agency and inter-agency communications,
draft reports and/or summaries, schedules, notes, memoranda, and
all other records relating to an examination or investigation.
NOTE: The purpose of this bill is to clarify that the chief
inspector may also investigate, in addition to examine, the
financial affairs of local governmental offices or political
subdivisions and boards, commissions, authorities, agencies and
other entities. The bill clarifies that the chief inspector may
also initiate civil and criminal actions if an investigation
discloses misfeasance, malfeasance or nonfeasance. The bill
provides for confidentiality of reports and working papers of the
chief inspector division. The bill also defines a term.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
§6-9-9b is new; therefore, it has been completely
underscored.