§ 14503 Financial And Compliance Audits

This law says school district audits must follow GAO rules and a specific audit guide, and auditors have to do a quality‑control check every three years.

Key Takeaways

•Audits must follow General Accounting Office (GAO) standards.
•The Controller’s audit guide is used until the Education Audits Appeal Panel adopts a new guide; then the new guide is used.
•Audit reports must list each state program requirement, say if the district complies, and note which audit steps were followed.
•If a district breaks a rule that affects eligibility for state funds, the report must show any wrongly reported attendance numbers.
•Auditors must do a GAO‑standard quality‑control review every three years (starting the month after the first audit or last review).
•Auditors could keep doing audits until Jan 1 1994, regardless of the three‑year review rule.

Example

A local school district receives state funding and hires an auditor to check its finances and compliance.

The auditor uses the Controller’s audit guide (or the one later adopted by the Education Audits Appeal Panel) to review the district’s books. The audit report must say for each state rule whether the district follows it, and if the district reported too many student attendance numbers to get more money, the report must note that. The auditor also has to complete a quality‑control review of their work at least once every three years.

(a) Financial and compliance audits shall be performed in accordance with General Accounting Office standards for financial and compliance audits. The audit guide prepared by the Controller shall be used in the performance of these audits until an audit guide is adopted by the Education Audits Appeal Panel pursuant to Section 14502.1. When an audit guide is adopted by that panel, the adopted audit guide shall be used in the performance of these audits. Every audit report shall specifically and separately address each of the state program compliance requirements included in the audit guide, stating whether or not the district is in compliance with those requirements. For each state program compliance requirement included in the audit guide, every audit report shall further state that the suggested audit procedures included in the audit guide for that requirement were followed in the making of the audit, if that is the case, or, if not, what other procedures were followed. If a local education agency is not in compliance with a requirement that is a condition of eligibility for the receipt of state funds, the audit report shall include a statement of the number of units of average daily attendance, if any, that were inappropriately reported for apportionment. (b) An independent auditor shall not engage in financial or compliance audits unless, within three years of commencing the first of the audits, and every successive three years thereafter, the auditor completes a quality control review in accordance with General Accounting Office standards. The time period between commencement of the first audit, or completion of a quality control review, and completion of a subsequent quality control review shall be calculated from the first day of the month following commencement of the audit or completion of the quality control review. Notwithstanding this subdivision, independent auditors may continue to perform any financial and compliance audits until January 1, 1994. (Amended by Stats. 2002, Ch. 1128, Sec. 5. Effective January 1, 2003.)

This law says school district audits must follow GAO rules and a specific audit guide, and auditors have to do a quality‑control check every three years.

Key Takeaways

•Audits must follow General Accounting Office (GAO) standards.
•The Controller’s audit guide is used until the Education Audits Appeal Panel adopts a new guide; then the new guide is used.
•Audit reports must list each state program requirement, say if the district complies, and note which audit steps were followed.
•If a district breaks a rule that affects eligibility for state funds, the report must show any wrongly reported attendance numbers.
•Auditors must do a GAO‑standard quality‑control review every three years (starting the month after the first audit or last review).
•Auditors could keep doing audits until Jan 1 1994, regardless of the three‑year review rule.

Example

A local school district receives state funding and hires an auditor to check its finances and compliance.

Key Takeaways

Example

Key Terms

References

§ 14503 Financial And Compliance Audits

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References