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HB2015 - 572R - H Ver
House Engrossed
budget procedures;
late filing penalty
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HOUSE BILL 2015
AN
ACT
Amending section 35-131, Arizona Revised
Statutes; relating to ACCOUNTING reports.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 35-131, Arizona Revised
Statutes, is amended to read:
START_STATUTE
35-131.
Accounting system; reports; notice of deficiency; forms
A. In accordance with generally accepted
governmental accounting principles, the department of administration shall
develop and prescribe for the use of all budget units a uniform accounting
system so designed as to ensure compliance with all legal and constitutional
requirements, including those respecting receiving, spending and accounting for
public monies.
B. The department of administration shall maintain
complete, accurate and current financial records relating to state monies and
to other public monies in the state treasury available to, encumbered by or
expended by each budget unit, including trust monies or other monies not
subject to appropriation, setting out all revenues, charges against all funds,
fund and appropriation balances, interfund transfers, outstanding warrants,
checks, electronic funds transfer vouchers and encumbrances, in a manner consistent
with the uniform state accounting system, to prepare statewide financial
statements in accordance with generally accepted governmental accounting
principles.
C. Each month the department of administration shall
prepare and submit to the governor a report summarizing by budget unit and
appropriation or other fund source the information prescribed in subsection B
of this section in a form that will most clearly and accurately set out the
current fiscal condition of the state and shall furnish to each budget unit a
report of its transactions by appropriation or other fund source in a form that
will clearly and accurately show the fiscal activity and condition of the
appropriation or fund source.
D. The responsible official for each budget unit
shall monitor reports prepared pursuant to subsection C of this section to
identify any projected total deficiency for the budget unit fiscal
year. On a determination of a projected deficiency, the official
shall take any action necessary to ensure continuing compliance with section 1-254
by notifying the governor, the speaker of the house of representatives, the
president of the senate and the chairman of the joint legislative budget
committee of the deficiency and the reasons for the deficiency. The
initial notification of the deficiency shall be followed within ten business
days by a report from the responsible budget unit official that includes the
following:
1. A complete explanation of the causes of the
deficiency.
2. A plan that ensures that the deficiency will be
resolved within the fiscal year without supplemental appropriation and that
includes the policy and programmatic implications of the deficiency and the
plan.
3. A commitment to provide a progress report if the
projected degree of deficiency changes substantially. The report
shall include additional measures necessary to ensure resolution of the
deficiency within the fiscal year.
E. On or before December 1 of each year, the
director of the department of administration shall submit to the governor a
complete report of the financial transactions of the preceding fiscal year and
of the financial condition of the state at the end of that year with such
comments and supplementary data as the director of the department of
administration deems necessary to make the report complete and readily
understandable. The report shall include all appropriated and
nonappropriated monies in no less detail than the state general fund.
F. On or before February 1 of each year, the
director of the department of administration and the state treasurer shall
submit to the joint legislative budget committee a report explaining any
differences between the department of administration's estimate of the previous
fiscal year's state general fund ending balance submitted pursuant to
subsection E of this section and the state treasurer's estimate of the invested
balance, including the state general fund share of that balance, as of June 30
of the previous fiscal year submitted pursuant to section 41-172.
G. In preparing the comprehensive annual financial
report published in accordance with generally accepted accounting principles,
the department of administration shall include supplementary schedules that
reconcile any differences between the state general fund as reported in the
comprehensive annual financial report and the state general fund as reported in
the annual financial report required by subsection E of this
section. This reconciliation shall address revenues, expenditures
and fund balances.
H. The director of the department of administration
shall prescribe uniform classifications for assets, liabilities, receipts and
expenditures and forms for the periodic reporting of financial accounts,
transactions and other matters by budget units compatible with the reports
required of the director of the department of administration under this
section. Such records and accounts shall be maintained and
reconciled by budget units.� If required for reporting, the department of administration
may establish or delete funds and budget units may maintain additional records
for reporting to the federal government or other funding source.
I. Each organization that is included in the state's
reporting entity as defined by generally accepted accounting principles shall
submit all necessary
, accurate and complete final
financial statements or information to the department of administration on a
basis of accounting that is consistent with generally accepted accounting
principles and that is in accordance with the policies and procedures of the
department of administration
to meet the financial reporting and
federal single audit requirements and deadlines of this state
.
j. If an organization fails to submit
accurate and complete final financial statements or information to the
department of administration on or before October 31 of a year pursuant to
subsection I of this section, the department of administration shall assess a
penalty of one twelfth of one percent of the organization's state general fund
appropriation for the ensuing fiscal year for every thirty days the submission
is late and shall withhold the penalty amount from the organization's state general
fund appropriation allotment schedule for the ensuing fiscal
year. The total penalty assessed pursuant to this subsection in any
fiscal year may not exceed $8,000,000 or one percent of the organization's
state general fund appropriation for the fiscal year in which the penalty is
assessed, whichever is less.
K. Each organization that is included
in the state's reporting entity as defined by generally accepted governmental
accounting principles and that spends federal monies shall submit all
necessary, accurate and complete final federal expenditure or program
information to the department of administration to meet the federal single
audit requirements and deadlines.
L. If an organization fails to submit
accurate and complete final federal expenditure or program information to the
department of administration on or before December 31 of a year pursuant to
subsection K of this section, the department of administration shall assess a
penalty of one twelfth of one percent of the organization's state general fund
appropriation for the ensuing fiscal year for every thirty days the submission
is late and shall withhold the penalty amount from the organization's state
general fund appropriation allotment SCHEDULE for the ensuing
year. The total penalty assessed pursuant to this section in any
fiscal year may not exceed $8,000,000 or one percent of the organization's
state general fund appropriation for the fiscal year in which the penalty is
assessed, whichever is less.
M. The maximum total penalty amounts
prescribed in subsections J and L of this section shall be annually adjusted by
the percentage increase or decrease in the maximum amount of monies available
in the state general fund for legislative appropriations as determined and
published by the economic estimates commission pursuant to section 41-562.
END_STATUTE