BILL ANALYSIS Ó
AB 341
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Date of Hearing: May 13, 2015
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Maienschein, Chair
AB
341 (Achadjian) - As Amended May 5, 2015
SUBJECT: Financial affairs: reports.
SUMMARY: Extends the amount of time for local agencies to
report financial information to the State Controller for the
publication of local financial transactions. Specifically,
this bill:
1)Extends the amount of time a local agency has to furnish to
the Controller a report of all the financial transactions
during the preceding fiscal year (FY) from 90 or 110 days to
seven months, after the close of each FY.
2)Requires the report to contain underlying data from audited
financial statements prepared in accordance with generally
accepted accounting principles, if the data is available.
3)Allows a legislative body to post the report in a conspicuous
location on its Internet Website or to furnish hardcopies to
any person requesting it.
4)Requires a local agency to submit to the Controller
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information on annual compensation, pursuant to the
requirements in existing law, for the previous calendar year
no later than April 30.
5)Requires the Controller to compile and publish reports of the
financial transactions of each county, city, and special
district on or before November 1 of each year following the
end
of the annual reporting period, instead of on or before August
1, September 1, and October 1, respectively.
6)Repeals a provision of law which establishes separate
reporting requirements for a local agency reporting to the
Office of Statewide Health Planning and Development and for a
community redevelopment agency.
7)Makes other technical and conforming changes.
EXISTING LAW:
1)Requires the officer of each local agency who has charge of
the financial records to furnish to the Controller a report of
all the financial transactions of the local agency during the
next preceding FY.
2)Requires the report to be furnished within 90 days after the
close of each FY and to be in the form required by the
Controller. Requires the report to be furnished within 110
days after the close of each FY if the report is filed in
electronic format as prescribed by the Controller.
3)Requires the report to contain specified contents and requires
the report to contain additional information for cities.
4)Requires the Controller to compile and publish reports of the
financial transactions of each county, city, and special
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district, respectively, within this state, together with any
other matter he or she deems of public interest, and requires
the reports to include the appropriations limits and the total
annual appropriations subject to limitation of the counties,
cities, and special districts.
5)Defines local agency to mean "any city, county, any district,
and any community redevelopment agency required to furnish
financial reports," pursuant to specified sections of existing
law.
6)Requires the Controller to prescribe uniform accounting and
reporting procedures applicable to special districts, except
for those that substantially follow a system of accounting
prescribed by the Public Utilities Commission or the Federal
Power Commission, and requires the Controller to prescribe
these procedures only after consultation with and approval of
a local governmental advisory committee established in current
law.
7)Requires the legislative body of the local agency to prepare
copies of the report and requires the legislative body's clerk
to provide a copy to any person requesting it. Authorizes a
charge, not to exceed twenty-five cents, for each copy of the
report.
FISCAL EFFECT: None
COMMENTS:
1)Background. Existing law requires the officer of each city,
county, and special district, who has charge of the financial
records of the agency, to furnish to the State Controller a
report of all the financial transactions of the local agency
during the next preceding FY, within 90 or 110 days of the
close of each FY. Current law also requires the Controller to
compile and publish reports of the financial transactions of
each county, city, and special district. The annual financial
transactions data published by the Controller is the most
comprehensive, and in some cases, the only source of financial
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data for California's local governments. The Legislature,
Legislative Analyst's Office, local officials, grand juries,
policy organizations, and other observers all rely on these
reports.
2)Bill Summary. This bill makes a number of changes to the
timelines established in existing law for local agencies to
submit their annual financial transactions report to the
Controller. This bill extends the amount of time to seven
months after the close of each FY that local agencies have to
provide the annual financial transactions reports to the
Controller. Under this bill, the report must contain
underlying data from audited financial statements prepared in
accordance with generally accepted principals, if the data is
available. Upon completion of the report, this bill allows a
local agency to post the report on its website or provide
hardcopies to those individuals requesting copies. This bill
makes conforming changes to the publishing requirements for
the Controller.
This bill also establishes a separate reporting date for local
agencies to submit information required by existing law
regarding compensation to the Controller for the previous
calendar year, no later than April 30.
This bill is sponsored by the League of California Cities.
3)Author's Statement. According to the author, "For most local
agencies, an [FY] ends between June 31st and July 1st. Upon
conclusion of the [FY], local agencies are required to submit
financial information to the Controller's Office within 90
days. The Controller's Office then publishes certain
financial information about selected districts for public view
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on the Controller's website. While they are required to
submit this information within 90 days, most local agencies
have a third party auditor come in to perform a complete audit
report. However, the audits are not often completed until
December-January.
"As a result, local agencies often resubmit their reports with
additional or corrected information found in the audit to the
Controller's Office after the audit is completed. Submitting
incomplete or unaudited data can create confusion for the
public and additional work for both the State Controller's
office and the local agency staff to update information to
reflect final audits.
"This bill will extend the deadline which a local agency is
required to submit the report to the Controller's office. The
bill will require that the report will contain data from
audited financial statements if the data is available. This
will give local agencies additional time to work with an
auditor if they choose to, in order to ensure that accurate
data is available for the public's view."
4)Arguments in Support. Supporters argue that this bill
increases transparency, provides more accurate information to
the public, and saves local agencies time and resources.
5)Arguments in Opposition. None on file.
REGISTERED SUPPORT / OPPOSITION:
AB 341
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Support
League of California Cities [SPONSOR]
California Special Districts Association
California State Association of Counties
Opposition
None on file
Analysis Prepared
by: Misa Lennox / L. GOV./(916) 319-3958