7-82-401 - Audit Accounting manual Books and records.
7-82-401. Audit Accounting manual Books and records.
(a) (1) The commissioners of each utility district shall cause an annual audit to be made of the books and records of their district. The comptroller of the treasury, through the department of audit, is responsible for determining that such audits are prepared in accordance with generally accepted governmental auditing standards, and that such audits meet the minimum standards prescribed by the comptroller of the treasury.
(2) (A) In all counties and districts, except as provided in subdivision (a)(2)(B), the comptroller of the treasury shall prepare a uniform accounting manual and shall promulgate such other rules and regulations as are required to assure that the books and records are kept in accordance with generally accepted accounting principles and that audit standards prescribed by the comptroller of the treasury are met. Such manual and rules shall not be applied to invalidate obligations contained in bond resolutions or other debt contracts, nor to modify any substantive legal powers or requirements applicable to utility districts.
(B) In gas utility districts, and in the counties having the following populations, according to the 1980 federal census or any subsequent census, the comptroller of the treasury shall promulgate such rules and regulations as are required to assure that the books and records are kept in accordance with generally accepted accounting procedures and that audit standards prescribed by the comptroller of the treasury are met:
Click to view table.
(b) The audits shall be prepared by certified public accountants, public accountants or by the department of audit. In the event the governing body of the utility district shall fail or refuse to have the audit prepared, then the comptroller of the treasury may appoint a certified public accountant, or public accountant or direct the department to prepare the audit, the cost of such audit to be paid by the utility district.
(c) The comptroller of the treasury is authorized to modify the requirements for an audit as set out in this section for utility districts whose activity, in the comptroller of the treasury's judgment, is not sufficient to justify the expenses of a complete audit. Furthermore, the comptroller of the treasury is authorized to direct the department of audit to make an audit or financial review of the books and records of utility districts.
(d) Within ninety (90) days after the close of the fiscal year of each district organized and operating under the provisions of this law, the commissioners of the district shall publish in a newspaper of general circulation, published in the county in which the district is situated, a statement showing:
(1) The financial condition of the district at the end of the fiscal year;
(2) The earnings of the district during the fiscal year just ended;
(3) A statement of the water rates then being charged by the district; and
(4) A brief statement of the method used in arriving at such rates.
(e) A copy of such annual statement and audit shall be filed with the county mayor or mayors where publication is required in accordance with this section and § 7-82-608, and a copy shall be forwarded to the office of the comptroller of the treasury. The failure to file such copies is a Class C misdemeanor.
(f) Audits performed by the internal audit staffs of the utility districts shall be conducted in accordance with the standards established by the comptroller of the treasury pursuant to § 4-3-304(9).
(g) (1) Any utility district that is a financially distressed utility district shall be subject to the supervision and evaluation of the utility management review board created pursuant to part 7 of this chapter. For the purposes of this chapter, a financially distressed utility district is a utility district, its system or systems, that, as shown by the annual audits, has either deficit total net assets, is in default on an indebtedness, or has a negative change in net assets for two (2) consecutive years.
(2) (A) No provision of this subsection (g) shall apply to any gas utility district for the reasons set out in § 7-82-103.
(B) The provisions of this subsection (g) shall not apply in counties having the following populations, according to the 1980 federal census or any subsequent federal census:
Click to view table.
(h) (1) Utility districts operating public water systems shall include in their annual audit the utility district's annual average unaccounted for water loss percentage in the manner prescribed by the comptroller of the treasury. Within sixty (60) days from the time that a utility district's audit is filed with the comptroller of the treasury, the comptroller of the treasury shall file with the utility management review board the audit report of any utility district operating a water system whose unaccounted for water loss is excessive as established by rules promulgated by the utility management review board.
(2) For the purposes of subdivision (h)(1), utility district includes agencies, authorities or instrumentalities of government created by public or private act having the authority to administer a water or wastewater facility, other than those agencies, authorities or instrumentalities of government electing pursuant to § 68-221-1006(a) or § 68-221-1008 to come under the jurisdiction of the water and wastewater financing board.
(i) By February 1 of each year, the comptroller of the treasury shall provide a written report to the chair of the conservation and environment committee of the house of representatives and the environment, conservation and tourism committee of the senate listing the average annual unaccounted for water loss contained in the annual audit for those utility districts described in subsection (h).
[Acts 1949, ch. 256, § 1; C. Supp. 1950, § 3695.46 (Williams, § 3695.43a); Acts 1968, ch. 529, § 4; 1975, ch. 139, § 1; impl. am. Acts 1978, ch. 934, §§ 16, 36; T.C.A. (orig. ed.), § 6-2617; Acts 1984, ch. 794, § 4; 1987, ch. 422, § 7; 1989, ch. 139, § 5; 1989, ch. 221, §§ 6, 7; 1989, ch. 591, § 113; 2004, ch. 619, § 7; 2007, ch. 243, § 1; 2008, ch. 700, § 1; 2009, ch. 72, § 1.]