2011-06-28 CC ARRA CIC Packethim r•-
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CITY HALL Q ONE FRANK H. ❑GA 'A PLAZA, 4TI- FLOOR o OAKLAND, CALIFORNIA 94612
Office of the City Auc itoi= (510) 23 8-33 78
CoLianey A. Rub CPA FAX (5 0) 238 -7640
City Auditor TDD (5 0) 238 -3254
www.oald
April 20, 20
California State Controller's Office
John Chiang
P.O. Box .942850
Sacramento, California 94250 5872
RE: SUGGESTED CHANGES FOR CLARIFICATION TO ASSEMBLY BILL 229
Dear Controller Chiang,
First, we would like to express our appreciation for your co=itment to increasing fiscal and
performance oversight in California's cities. As independently elected city auditors, we believe
that government auditing is critical to accountability and good governance.
.After carefully reviewing .Assembly Bill 229 as amended on March 3 0, 2011), we respectfully
offer a select number of technical changes that. would greatly enhance this proposed legislation
by providing increased clarity to certain sections of the bill.
h
Please find these suggest changes below (in. italics and .tr -1r154, .(E1 5A. A)
12410.6. (a) The Controller shall develop a plan to review and report on the annual
financial audit reports i ncluding rr g th ose r "c JoT
prepared ed in compliance odth the federal Single 4udit Act of 1984 for Toeai agencies. The
w Controller, in consultation with the Department of Finance, and representatives of the
League of California Cities, the California State Association of County Auditors, and the
California Society of Certified Public Accountants, shall propose the content of, and
adopt, an audit guide.
Contre [lei John Chiang
Suggested .changes foi• Clarification to Assembly Bill 229
Page 2 of 2
12410.7. a) The Controller on an annual basis shall review and monitor the annual
financial audit, including those reports prepared in cornp ance wl'th. the federal Single
A ud i t A ct cif' 1 984 .The Controller shall
determine whether the audit reports conform with the reporting provisions of government
auditing standards and the audit guide and shall notify each local agency, and the auditor
of each local agency regarding each determination.
12410.9. (a) The Controller may perform quality control reviews of audit working papers
of the annual financial audit reports, including those reports prepared in corrnpliance
A) ith the federal Single Audit .pct of 1984, to detennine whether audits are performed in
conformity nth governn audit standards and the local agency audit guide. The
Controller shall con mlunicate the results of his or her reviews to the Department of
Finance, the independent auditor, and the local agency for which the audit was
performed, wid shall review his or her findings with the independent auditor,
By implementing the aforementioned changes, the bill will benefit from the following
enhancements
(a) Ensuring that the audit type to which this legislation is directed, as defined in
Scotian 12410.5 (a), is reflected throughout the legislation, thus preventing
any misinterpretation; and
(U) Distinguishing between (1) performance audits performed by independent city
auditor offices in cities, such as Oakland and Berkeley, and (2) the ann ual
f
financial statement audits or single audits performed by commercial public
accounting firms under contract to the cities,
:As members of the Association of Local Government Auditors (ALGA), we encourage you to
visit our website at ter, gxovernmentauditors.or or to contact us at aho gan c,it ofberkele info
or ertib) for more information about city auditors and independent audit
co=ittees.
Please do not hesitate to contact either of us if you have any questions.
Sincerely,
COURTNEY A. UBY, CPA, CF ANN -MARIE HOGAN
Oakland City Auditor Berkeley City Auditor
CITE` HALL e ONE FRANK H. OCAWA PLAZA, 4TH FLOOR in OAKLAND, CALIFORNIA, 94612
Off ice of th City Audito
Courtney A. Ruby, CPA
City ALIClitOr
April 20, 2011
Office of Asscinblymember Ricardo La .ra
State Capitol
P.D. Box 942849 e
Sacramento, CA 94249 -0050
(51 o) 23 8-3 3 78
FAX (510) 238 7640
TDD (510) 238 -3254
www.oak anda
RE: SUGGESTED CHANGES FOR CLARIFICATION TO ASSEMBLY BILL 229
Dear Assemblym.ember Lara,
First, we would like to express our appreciation for your conunitrnent to increasing fiscal and
perfonnan.ce oversight in California's cities. As independently elected city auditors, we believe
that government auditing is critical to accountability and good governance.
After carefully reviewing yo Assembly Bill 229 (as amended on March 3 0, 2011), vie
respectfully offer a select number of technical changes that would greatly enhance this proposed
legislation by providing Increased clarity to certain sections of the bill.
Please find these suggested changes below (in. italics and Q+v;r� +rt�.n
b
1 2410 .6. (a) The Controller shall develop a plan to review and repay on the a7inuaZ
financial audit r��or is it ?eluding 117,ase reports
is
prepared in carn �aZiarice osifli tlzc��cderaa Shigle Audit Act of 1984 jor� l agencies. The
Controller, in consultation with the Department of Finance., and representatives of the
League of California Cities, the California State Association of Colony Auditors, and the
California Society of Certified Public Accountants, shall propose the content of, and
adopt, an audit guide.
Assemblymember Ricardo Lara
Suggested Changes for Clarification to Assembly Bill '429
Page 2 of 2
1241 0.7. (a) The Controller on an annual basis shall review and monitor the annual
financial audit, including those reports prepared in compliance 144th the federal Single
audit pct o8 The Controller shall
determine whether the audit reports conform with the reporting provisions of goveznr cn.t
auditing standards and the audit guide and shall notify each local agency, and the auditor
of each local agency regarding each determination.
12410.9. (a) The Controller may perform. quality control reviews of audit working papers
of the annual financial audit reports, including those reports prepared in rcompl`iance
iiiith the federal Single Audit Act of 1984, to determine whether audits are performed in
conformity with government audit standards and the local agency audit guide. The
Controller shall comniunicate the results of his or her revi to the D ep artrnent of
Finance, the independent auditor, and the local agency for which the audit was
performed, and shall review his or her findings with the independent auditor.
By implementing the aforementioned changes, the bill will benefit from the folio -Wing
enhancements:
(a) Ensuring that the audit type to which this legislation is directed, as defined in
Section 12410.5 (a), is reflected throughout the legislation., thus preventing
any misinterpretation; and
(b) Distinguishing between (1) performance audits performed-by independent city
auditor o ffi ces in cities, such as Oakland and Berkeley, sand. (2) the annual
financial statement audits or single audits performed by commercial public
accounting firms under contract to the cities.
As members of the Association of Local Government Auditors (ALGA), we encourage you to
visit our website at w\Afw.governmentauditors.org or to contact us at ahocran cit ofberl�ele .info
or cxubv o al l andnet. co m for more information about city auditors and independent audit
committees.
Please do not hesitate to contact either of us if you have any questions.
Sincerely,
COURTNEY A. R
Oakland City Audi
Zo &L"-
ANN-MARIE H o GAIL
Berkeley City .Auditor