As Reported by the House State Government Committee 1
123rd General Assembly 4
Regular Session Sub. H. B. No. 769 5
1999-2000 6
REPRESENTATIVES METTLER-NETZLEY-JERSE-GRENDELL-JACOBSON- 8
VAN VYVEN-PETERSON-ROBINSON-CATES
_________________________________________________________________ 9
A B I L L
To amend sections 117.01, 117.11, and 117.12 of the 11
Revised Code to make changes in the law governing 12
the Auditor of State's audits of public offices. 13
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 15
Section 1. That sections 117.01, 117.11, and 117.12 of the 17
Revised Code be amended to read as follows: 18
Sec. 117.01. As used in this chapter: 27
(A) "Color of office" means actually, purportedly, or 29
allegedly done under any law, ordinance, resolution, order, or 30
other pretension to official right, power, or authority. 31
(B) "Public accountant" means any person who is authorized 33
by Chapter 4701. of the Revised Code to use the designation of 34
certified public accountant or who was registered prior to 35
January 1, 1971, as a public accountant. 36
(C) "Public money" means any money received, collected by, 38
or due a public official under color of office, as well as any 39
money collected by any individual on behalf of a public office or 40
as a purported representative or agent of the public office. 41
(D) "Public office" means any state agency, public 43
institution, political subdivision, other organized body, office, 44
agency, institution, or entity established by the laws of this 45
state for the exercise of any function of government. 46
(E) "Public official" means any officer, employee, or duly 48
authorized representative or agent of a public office. 49
(F) "State agency" means every organized body, office, 51
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agency, institution, or other entity established by the laws of 52
the state for the exercise of any function of state government. 53
(G) "AUDIT" MEANS ANY OF THE FOLLOWING: 55
(1) ANY EXAMINATION, ANALYSIS, OR INSPECTION OF THE 57
STATE'S OR A PUBLIC OFFICE'S FINANCIAL STATEMENTS OR REPORTS; 59
(2) ANY EXAMINATION, ANALYSIS, OR INSPECTION OF RECORDS, 61
DOCUMENTS, BOOKS, OR ANY OTHER EVIDENCE RELATING TO EITHER OF THE 63
FOLLOWING:
(a) THE COLLECTION, RECEIPT, ACCOUNTING, USE, OR 65
EXPENDITURE OF PUBLIC MONEY BY A PUBLIC OFFICE OR BY A PRIVATE 66
INSTITUTION, ASSOCIATION, BOARD, OR CORPORATION; 67
(b) THE DETERMINATION BY THE AUDITOR OF STATE, AS REQUIRED 69
BY SECTION 117.11 OF THE REVISED CODE, OF WHETHER A PUBLIC OFFICE 70
HAS COMPLIED WITH ALL THE LAWS, RULES, ORDINANCES, OR ORDERS 71
PERTAINING TO THE PUBLIC OFFICE.
(3) ANY OTHER TYPE OF EXAMINATION, ANALYSIS, OR INSPECTION 73
OF A PUBLIC OFFICE OR OF A PRIVATE INSTITUTION, ASSOCIATION, 75
BOARD, OR CORPORATION RECEIVING PUBLIC MONEY THAT IS CONDUCTED 76
ACCORDING TO GENERALLY ACCEPTED OR GOVERNMENTAL AUDITING 77
STANDARDS ESTABLISHED BY RULE PURSUANT TO SECTION 117.19 OF THE 78
REVISED CODE.
Sec. 117.11. (A) Except as OTHERWISE provided in THIS 87
division (D) of this section, the auditor of state shall commence 89
an audit of each public office not more than AT LEAST ONCE EVERY 91
two FISCAL years from the release date of the last audit report 93
of such public office. THE AUDITOR OF STATE SHALL AUDIT A PUBLIC 94
OFFICE EACH FISCAL YEAR IF THAT PUBLIC OFFICE IS REQUIRED TO BE 95
AUDITED ON AN ANNUAL BASIS PURSUANT TO "THE SINGLE AUDIT ACT OF 96
1984," 98 STAT. 2327, 31 U.S.C.A. 7501 ET SEQ., AS AMENDED. In 97
the ANNUAL OR BIENNIAL audit, inquiry shall be made into the 98
methods, accuracy, and legality of the accounts, financial 99
reports, records, files, and reports of the office, whether the 100
laws, RULES, ordinances, and orders pertaining to the office have 102
been observed, and whether the requirements and rules of the 103
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auditor of state have been complied with. Except AS OTHERWISE 104
PROVIDED IN THIS DIVISION OR where auditing standards or 105
procedures dictate otherwise, each audit shall cover at least one 106
fiscal year. IF A PUBLIC OFFICE IS AUDITED ONLY ONCE EVERY TWO 107
FISCAL YEARS, THE AUDIT SHALL COVER BOTH FISCAL YEARS. 108
(B) IN ADDITION TO THE ANNUAL OR BIENNIAL AUDIT PROVIDED 110
FOR IN DIVISION (A) OF THIS SECTION, THE AUDITOR OF STATE MAY 111
CONDUCT AN AUDIT OF A PUBLIC OFFICE AT ANY TIME WHEN SO REQUESTED 114
BY THE PUBLIC OFFICE OR UPON THE AUDITOR OF STATE'S OWN
INITIATIVE IF THE AUDITOR OF STATE HAS REASONABLE CAUSE TO 115
BELIEVE THAT AN ADDITIONAL AUDIT IS IN THE PUBLIC INTEREST. 116
(B)(C)(1) The auditor of state shall identify any public 118
office in which the auditor of state will be unable to conduct an 119
audit AT LEAST once every two FISCAL years as required by 120
division (A) of this section and shall provide immediate written 121
notice to the clerk of the legislative authority or governing 123
board of the public office so identified. Within six months of 124
the receipt of such notice, the legislative authority or 125
governing board may engage an independent certified public 126
accountant to conduct an audit pursuant to section 117.12 of the 127
Revised Code.
(2) When the chief fiscal officer of a public office 129
notifies the auditor of state that an audit is required at a time 130
prior to the next regularly scheduled audit by the auditor of 131
state, the auditor of state shall either cause an earlier audit 132
to be made by the auditor of state or authorize the legislative 133
authority or governing board of the public office to engage an 134
independent certified public accountant to conduct the required 135
audit. The scope of the audit shall be as authorized by the 136
auditor of state. 137
(3) The auditor of state shall approve the scope of an 139
audit under division (B)(C)(1) or (2) of this section as set 140
forth in the contract for the proposed audit before the contract 141
is executed on behalf of the public office that is to be audited. 142
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The independent accountant conducting an audit under division 144
(B)(C)(1) or (2) of this section shall be paid by the public
office. 145
(C)(D) If a uniform accounting network is established 147
under section 117.101 of the Revised Code, the auditor of state 148
or a certified public accountant employed pursuant to this 149
section or section 115.56 of the Revised Code shall, to the 150
extent practicable, utilize services offered by the network in 151
order to conduct efficient and economical audits of public 152
offices.
(D) The auditor of state may, by rule, provide for waiver 154
of the two-year requirement of division (A) of this section with 155
respect to: 156
(1) Public offices participating in a uniform accounting 158
network established under section 117.101 of the Revised Code; 159
(2) Public offices that are not required by federal law to 161
be audited in accordance with federal auditing standards. 162
The rules may provide for the application of specified 164
audit procedures to such public offices in lieu of an audit in 165
accordance with generally accepted government auditing standards. 166
(E) The auditor of state shall, in accordance with 168
division (A)(3) of section 9.65 of the Revised Code and this 169
section, audit an annuity program for volunteer fire fighters 170
established by a political subdivision under section 9.65 of the 171
Revised Code. As used in this section, "volunteer fire fighters" 172
and "political subdivision" have the same meanings as in division 173
(C) of section 9.65 of the Revised Code. 174
Sec. 117.12. Any public accountant engaged to perform an 183
audit pursuant to division (B)(C) of section 117.11 of the 184
Revised Code shall conduct the audit pursuant to the standards, 186
procedures, and guidelines of the auditor of state for such 187
audits. The auditor of state shall establish these standards, 188
procedures, and guidelines by rule. The audit shall cover the 189
period beginning with the termination date of the most recent 190
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audit conducted under this section or section 117.11 of the 191
Revised Code and ending on the date specified by the auditor of 192
state. The accountant shall inquire into the methods, accuracy, 193
and legality of the accounts, records, files, and reports of the 194
public office and shall note whether, in his THE ACCOUNTANT'S 195
opinion, the laws, RULES, ordinances, and orders pertaining to 197
the public office have been complied with. The accountant shall 198
have no authority to make formal findings of illegality, 199
malfeasance, or gross neglect under this division or section 200
117.23 of the Revised Code.
Section 2. That existing sections 117.01, 117.11, and 202
117.12 of the Revised Code are hereby repealed. 203