BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 117
                                                                  Page  1

          Date of Hearing:   April 3,2013

           ASSEMBLY COMMITTEE ON ACCOUNTABILITY AND ADMINISTRATIVE REVIEW
                                 Jim Frazier, Chair
                 AB 117 (Cooley) - As Introduced:  January 14, 2013 
           
          SUBJECT  :   State Government: Financial and Administrative  
          Accountability

           SUMMARY  :   This bill makes specified legislative findings and  
          directs the Department of Finance (DOF) to establish guidelines  
          for agencies to ensure proper internal monitoring, accounting,  
          and administrative controls within these agencies. 

          Specifically, this bill:
          1)Requires DOF put in place guidelines that ensure agency  
            monitors are independent and objective. 

          2)Requires state agency heads follow standards that facilitate  
            production of timely and accurate financial reports including  
            recommendations for how to achieve greater efficiencies in  
            support of the agency's mission without undermining program  
            effectiveness, quality, or customer satisfaction.

          3)Requires DOF put in place guidelines for state agency managers  
            on how the role of independent monitor should be staffed,  
            structured, and its reporting function standardized so it fits  
            within an efficient and normalized agency administrative  
            framework.


           EXISTING LAW  established the Financial Integrity and State  
          Manager's Accountability Act of 1983. Within the Act the  
          Legislature, among other things, declared it to be the policy of  
          the state that each state agency maintains effective systems of  
          internal accounting and administrative control as an integral  
          part of its management practices, and that those systems are  
          evaluated on an ongoing basis through regular and ongoing  
          monitoring processes.

           FISCAL EFFECT  :   unknown

           COMMENTS  :   According to the author, recent events have  
          highlighted and heightened the importance of continued progress  
          in strengthening the soundness of fiscal auditing and  








                                                                  AB 117
                                                                  Page  2

          transparent accountability of state operations. 

          This bill seeks to create stronger guidelines for agencies'  
          internal monitors ensuring that the state follows the same best  
          practices as required in the private sector and gives an  
          additional check on state finances to ensure public funds are  
          wisely spent.

          The bill accomplishes this by directing DOF to develop  
          guidelines ensuring agency monitors are independent and  
          objective. This includes the consideration of how an independent  
          monitor should be staffed, structured, and utilized in a  
          standardized way to ensure efficiency and fit within an agencies  
          normal administrative framework.

          Additionally, the bill directs state agency heads use financial  
          reports that include recommendations on how an agency may  
          achieve greater efficiencies without undermining its mission or  
          customer satisfaction.



           REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          None on file

           Opposition 
           
          None on file
           
          Analysis Prepared by  :    William Herms / A. & A.R. / (916)  
          319-3600