A bill for an act relating to audits of governmental subdivisions by the state auditor concerning suspected embezzlement, theft, or other significant financial irregularities.

House

File

2464

-

Introduced

HOUSE

FILE

2464

BY

WILSON

A

BILL

FOR

An

Act

relating

to

audits

of

governmental

subdivisions

by

the

1

state

auditor

concerning

suspected

embezzlement,

theft,

or

2

other

significant

financial

irregularities.

3

BE

IT

ENACTED

BY

THE

GENERAL

ASSEMBLY

OF

THE

STATE

OF

IOWA:

4

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Section

1.

Section

11.6,

Code

2026,

is

amended

by

adding

the

1

following

new

subsection:

2

NEW

SUBSECTION

.

7A.

Upon

notification

of

any

suspected

3

misuse

of

public

funds

as

described

in

subsection

7,

the

4

certified

public

accountant

and

the

governmental

subdivision

5

shall

cooperate

with

the

auditor

of

state

to

establish

6

procedures

to

investigate

the

suspected

embezzlement,

theft,

7

or

other

significant

financial

irregularities.

The

auditor

8

of

state

shall

determine

if

the

auditor

of

state

will

perform

9

further

procedures.

The

governmental

subdivision

shall

10

reimburse

the

auditor

of

state

for

any

actions

taken

by

the

11

auditor

of

state

to

investigate

the

suspected

embezzlement,

12

theft,

or

other

significant

financial

irregularities.

The

13

costs

assessed

shall

not

exceed

the

amount

of

the

public

funds

14

misused

as

determined

by

the

auditor.

15

EXPLANATION

16

The

inclusion

of

this

explanation

does

not

constitute

agreement

with

17

the

explanation’s

substance

by

the

members

of

the

general

assembly.

18

This

bill

relates

to

audits

of

governmental

subdivisions

19

concerning

suspected

embezzlement,

theft,

or

other

significant

20

financial

irregularities.

21

The

bill

provides

that

upon

notification

to

the

auditor

22

of

state

by

a

certified

public

accountant

and

a

governmental

23

subdivision

of

any

misuse

of

public

funds

involving

any

24

suspected

embezzlement,

theft,

or

other

significant

financial

25

irregularities

of

a

governmental

subdivision

of

this

state,

the

26

certified

public

accountant

and

the

governmental

subdivision

27

shall

cooperate

with

the

auditor

of

state

to

establish

28

procedures

to

investigate

the

suspected

embezzlement,

theft,

29

or

other

significant

financial

irregularities.

The

auditor

30

of

state

shall

determine

if

the

auditor

of

state

will

perform

31

further

procedures.

The

governmental

subdivision

shall

32

reimburse

the

auditor

of

state

for

any

actions

taken

by

the

33

auditor

of

state

to

investigate

the

reported

embezzlement,

34

theft,

or

other

significant

financial

irregularities.

The

35

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costs

assessed

shall

not

exceed

the

amount

of

the

public

funds

1

misused

as

determined

by

the

auditor.

2

“Governmental

subdivision”

is

defined

in

Code

section

11.1

3

as

cities

and

administrative

agencies

established

by

cities,

4

hospitals

or

health

care

facilities

established

by

a

city,

5

counties,

county

hospitals

organized

under

Code

chapters

347

6

and

347A,

memorial

hospitals

organized

under

Code

chapter

37,

7

entities

organized

under

Code

chapter

28E,

community

colleges,

8

area

education

agencies,

and

school

districts.

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