H. B. 4451
(By Delegates Cann, Pethtel, Perry, Palumbo,
Browning, Poling and Walters)
(Originating in the Committee on Industry and Labor,
Economic Development and Small Business)
[February 12, 2004]
A BILL to amend and reenact §5E-1-16 and §5E-1-17 of the code of
West Virginia, 1931, as amended, relating to the West Virginia
capital company act; and clarifying that the economic
development authority and tax commissioner are authorized to
require certain examination and compliance actions.
Be it enacted by the Legislature of West Virginia:
That §5E-1-16 and §5E-1-17 of the code of West Virginia, 1931,
as amended, be amended and reenacted to read as follows:
ARTICLE 1. WEST VIRGINIA CAPITAL COMPANY ACT.
§5E-1-16. Examination.
(a) Annually each qualified capital company
and center shall
cause its books and records to be audited by an independent
certified public accountant in accordance with generally accepted
auditing and accounting principles. In addition to the performance
of a financial audit, the audit shall address the methods of
operation and conduct of the business of the West Virginia capital
company
or center to determine compliance with this article and
that the funds received by the company have been invested within the time limits required by this article. Upon completion, a copy
of the audit report shall be certified and sent to the authority.
(b) The authority may examine, under oath, any of the
officers, directors, agents, employees or investors of a West
Virginia capital company
or center regarding the affairs and
business of the company
or center. The authority may issue
subpoenas and subpoenas duces tecum and administer oaths. Refusal
to obey such a subpoena or subpoena duces tecum may at once be
reported to the circuit court of the county in which the company
or
center is located or the persons subpoenaed reside and the circuit
court shall enforce obedience to the subpoena or subpoena duces
tecum in the manner provided by law for compliance with a subpoena
or subpoena duces tecum issued by a circuit court of this state.
(c) In addition to the audits herein required, the authority
and the tax commissioner may jointly audit any capital company or
number of capital companies
or centers in any year on a random
basis, or for cause, or for any other basis the authority or the
tax commissioner may select. The tax commissioner may also audit
any company or business in which a capital company has made an
investment, or which a capital company proposes to invest, on a
random audit selection basis, or for cause, or on any other basis
the tax commissioner may select. Nothing herein shall be construed
to prohibit the tax commissioner from conducting any audit relating
to the administration or enforcement of the tax laws of this state
which the tax commissioner may, in his
or her discretion, determine
to be appropriate.
§5E-1-17. Failure to comply.
(a) If the examination conducted pursuant to section sixteen
of this article discloses that a West Virginia capital company
or
center is not in compliance with the provisions of this article,
the authority may exercise any of the powers necessary and
appropriate to protect the authority's interest.
(b) The authority shall give a West Virginia capital company
or center written notice of any inadequacies in its compliance with
the provisions of this article, and specify a period of time the
company has to redress such inadequacies. Failure within said time
period to make corrections will result in further action by the
authority pursuant to this section.