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HF 2257

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 02:01am

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 04/01/2009

Current Version - as introduced

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A bill for an act
relating to state government; assigning duties relating to internal controls and
internal auditing in state government; requiring a report; amending Minnesota
Statutes 2008, section 16A.055, subdivision 1; proposing coding for new law
in Minnesota Statutes, chapter 16A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2008, section 16A.055, subdivision 1, is amended to
read:


Subdivision 1.

List.

(a) The commissioner shall:

(1) receive and record all money paid into the state treasury and safely keep it until
lawfully paid out;

(2) manage the state's financial affairs;

(3) keep the state's general account books according to generally accepted
government accounting principles;

(4) keep expenditure and revenue accounts according to generally accepted
government accounting principles;

(5) develop, provide instructions for, prescribe, and manage a state uniform
accounting system; new text begin and
new text end

(6) provide to the state the expertise to ensure that all state funds are accounted for
under generally accepted government accounting principlesdeleted text begin ; anddeleted text end new text begin .
new text end

deleted text begin (7) coordinate the development of, and maintain standards for, internal auditing in
state agencies and, in cooperation with the commissioner of administration, report to the
legislature and the governor by January 31 of odd-numbered years, on progress made.
deleted text end

(b) In addition to the duties in paragraph (a), the commissioner has the powers and
duties given to the commissioner in chapter 43A.

Sec. 2.

new text begin [16A.056] INTERNAL CONTROLS AND INTERNAL AUDITING.
new text end

new text begin Subdivision 1. new text end

new text begin Establishment of system. new text end

new text begin The commissioner is responsible for
the system of internal controls across the executive branch. The commissioner must
coordinate the design, implementation, and maintenance of an effective system of internal
controls and internal auditing for all executive agencies. The system must:
new text end

new text begin (1) safeguard public funds and assets and minimize incidences of fraud, waste,
and abuse;
new text end

new text begin (2) ensure that programs are administered in compliance with federal and state
laws and rules;
new text end

new text begin (3) require documentation of internal control procedures over financial management
activities, provide for analysis of risks, and provide for periodic evaluation of control
procedures to satisfy the commissioner that these procedures are adequately designed,
properly implemented, and functioning effectively; and
new text end

new text begin (4) provide for periodic internal audit of major systems and controls, including
accounting systems and controls; administrative systems and controls; and, in conjunction
with the office enterprise technology, information and telecommunications technology
systems and controls.
new text end

new text begin Subd. 2. new text end

new text begin Standards. new text end

new text begin The commissioner must adopt internal control standards
and policies that agencies must follow to meet the requirements of subdivision 1. These
standards and policies may include separation of duties, safeguarding receipts, time entry,
approval of travel, and other topics the commissioner determines are necessary to comply
with subdivision 1.
new text end

new text begin Subd. 3. new text end

new text begin Training and assistance. new text end

new text begin The commissioner shall coordinate training
for accounting personnel and financial managers in state agencies on internal controls
as necessary to ensure financial integrity in the state's financial transactions. The
commissioner shall provide internal control support to agencies that the commissioner
determines need this assistance.
new text end

new text begin Subd. 4. new text end

new text begin Sharing internal audit resources. new text end

new text begin The commissioner must administer a
program for sharing internal auditors among executive agencies that do not have their own
internal auditors and for assembling interagency teams of internal auditors as necessary.
new text end

new text begin Subd. 5. new text end

new text begin Monitoring Office of the Legislative Auditor audits. new text end

new text begin The commissioner
must review audit reports from the Office of the Legislative Auditor and take appropriate
steps to address internal control problems found in executive agencies.
new text end

new text begin Subd. 6. new text end

new text begin Budget for internal controls. new text end

new text begin The commissioner of finance may require
that each executive agency spend a specified percentage of its operating budget on internal
control systems. The commissioner of finance may require that an agency transfer a
portion of its operating budget to the commissioner to pay for internal control functions
performed by the commissioner.
new text end

new text begin Subd. 7. new text end

new text begin Annual report. new text end

new text begin The commissioner must report to the legislature and the
governor by January 31 of each odd-numbered year on the system of internal controls
and internal auditing in executive agencies.
new text end

new text begin Subd. 8. new text end

new text begin Agency head responsibilities. new text end

new text begin The head of each executive agency is
responsible for designing, implementing, and maintaining an effective internal control
system within the agency that complies with the requirements of subdivision 1, clauses (1)
to (4). The head of each executive agency must annually certify that the agency head has
reviewed the agency's internal control systems, and that these systems are in compliance
with standards and policies established by the commissioner. The agency head must
submit the signed certification form to the commissioner of finance, in a form specified by
the commissioner.
new text end

Sec. 3.

new text begin [16A.057] FINANCIAL CONTROLS COUNCIL.
new text end

new text begin Subdivision 1. new text end

new text begin Membership. new text end

new text begin The executive council shall appoint a five-member
financial controls council. Members must have public or private sector experience in
internal control issues. The council shall annually elect a chair and vice-chair from
among its members.
new text end

new text begin Subd. 2. new text end

new text begin Duties. new text end

new text begin (a) The council shall advise the commissioner of finance, the
governor, and the legislature on the system of internal controls for executive agencies.
In performing this duty, the council shall:
new text end

new text begin (1) review audits and other reports of the Office of the Legislative Auditor and
from internal auditors in executive agencies;
new text end

new text begin (2) review the state's system of internal controls and make recommendations for
changes in practices of specific executive agencies or on general changes needed in state
laws, procedures, or policies;
new text end

new text begin (3) recommend guidelines and best practices to produce an effective system of
internal controls;
new text end

new text begin (4) recommend the number of internal audit employees required for executive
agencies, individually and in total; and
new text end

new text begin (5) review and comment on the performance of the commissioner of finance in
carrying out duties under section 16A.056.
new text end

new text begin (b) The council may:
new text end

new text begin (1) require reports from any executive agency relative to an internal control or
an internal audit matter;
new text end

new text begin (2) receive and review reports from internal auditors in executive agencies;
new text end

new text begin (3) conduct hearings relative to attempts to interfere with, compromise, or intimidate
an internal auditor; and
new text end

new text begin (4) conduct hearings on the effectiveness of internal control or internal audit
functions within an executive agency.
new text end

new text begin Subd. 3. new text end

new text begin Terms; compensation; removal; vacancies; expiration. new text end

new text begin The membership
terms, compensation, removal of members, and filling of vacancies shall be as provided in
section 15.059, except that council members shall not receive a per diem. The council is
not subject to the expiration date provisions of section 15.059.
new text end

new text begin Subd. 4. new text end

new text begin Administrative support. new text end

new text begin The commissioner of finance shall provide
administrative support to the council upon request of its chair.
new text end