126.46 State audit committee.
126.46 State audit committee.
(A)(1) There is hereby created the state audit committee, consisting of the following five members:one public member appointed by the governor; two public members appointed by the speaker of the house of representatives, one of which may be a person who is recommended by the minority leader of the house of representatives; and two public members appointed by the president of the senate, one of which may be a person who is recommended by the minority leader of the senate. Not more than two of the four members appointed by the speaker of the house of representatives and the president of the senate shall belong to or be affiliated with the same political party. The member appointed by the governor shall be a person who is external to the management structure associated with the preparation of financial statements of state government and shall have the program and management expertise required to perform the duties of the committee’s chairperson.
Each member of the committee shall serve a three-year term, except for the initial members. With respect to the initial appointments of the members, the first member appointed by the speaker of the house of representatives shall serve a one-year term, the second member appointed by the speaker of the house of representatives shall serve a three-year term, the initial members appointed by the president of the senate shall serve two-year terms, and the initial member appointed by the governor shall serve a three-year term. Members may be reappointed to serve one additional term.
The committee shall include one member who is a financial expert; one member who is an active, inactive, or retired certified public accountant; one member who is familiar with governmental financial accounting; and one member who is a representative of the public.
Any vacancy on the committee shall be filled in the same manner as provided in this division, and, when applicable, the person appointed to fill a vacancy shall serve the remainder of the predecessor’s term.
(2) Members of the committee shall receive reimbursement for actual and necessary expenses incurred in the discharge of their duties.
(3) The member of the committee appointed by the governor shall serve as the committee’s chairperson.
(4) Initial appointments of committee members shall be made not later than thirty days after the effective date of this section.
(5) Members of the committee shall be subject to the disclosure statement requirements of section 102.02 of the Revised Code.
(B) The state audit committee shall do all of the following:
(1) Ensure that the internal audits conducted by the office of internal auditing in the office of budget and management conform to the institute of internal auditors’ international standards for the professional practice of internal auditing and to the institute of internal auditors’ code of ethics;
(2) Review and comment on the process used by the office of budget and management to prepare its annual budgetary financial report and the state’s comprehensive annual financial report required under division (A)(9) of section 126.21 of the Revised Code;
(3) Review and comment on unaudited financial statements submitted to the auditor of state and communicate with external auditors as required by government auditing standards;
(4) Perform the additional functions imposed upon it by section 126.47 of the Revised Code.
(C) As used in this section, “financial expert” means a person who has all of the following:
(1) An understanding of generally accepted accounting principles and financial statements;
(2) The ability to assess the general application of those principles in connection with accounting for estimates, accruals, and reserves;
(3) Experience preparing, auditing, analyzing, or evaluating financial statements presenting accounting issues that generally are of comparable breadth and level of complexity to those likely to be presented by a state agency’s financial statements, or experience actively supervising one or more persons engaged in those activities;
(4) An understanding of internal controls and procedures for financial reporting; and
(5) An understanding of audit committee functions.
Effective Date: 2007 HB166 02-14-2008