2013 -- H 5260

=======

LC00663

=======

STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2013

____________

A N A C T

RELATING TO TOWNS AND CITIES -- AUDIT OF ACCOUNTS AND INSTALLATION OF

SYSTEMS

     Introduced By: Representatives Marcello, Hearn, Nunes, Serpa, and Fellela

     Date Introduced: February 05, 2013

     Referred To: House Municipal Government

It is enacted by the General Assembly as follows:

1-1

     SECTION 1. Section 45-10-4 of the General Laws in Chapter 45-10 entitled "Audit of

1-2

Accounts and Installation of Systems" is hereby amended to read as follows:

1-3

     45-10-4. Annual post audit required. -- (a) Each municipality and regional school

1-4

district in the state, prior to the close of the fiscal year, shall retain the services of one or more

1-5

independent certified public accountants holding a certificate from the state of Rhode Island, or

1-6

from any other state with whom the state board of accountancy has a reciprocal relationship, to

1-7

make a detailed post audit of the financial records of the municipality or regional school district

1-8

for the preceding fiscal year in accordance with generally accepted auditing standards and

1-9

government auditing standards. School districts which are part of the primary government of a

1-10

municipality shall be included in the municipality's post audit and shall not be required to obtain a

1-11

separate post audit. The selection of auditors pursuant to this section shall be subject to the final

1-12

approval of the state auditor general. The municipality or school district shall not engage the

1-13

auditors or enter into a contract for those services until the auditor general gives his or her written

1-14

authorization. The term school district shall include regional school districts. At the request of the

1-15

auditor general, the audit firm for each municipality or school district shall release any and all

1-16

information obtained in the course of the engagement to the Rhode Island state auditor general (or

1-17

his or her designee). This information includes, but is not limited to, financial data, analysis, work

1-18

papers and memorandum. Audit work papers of the independent auditors shall be made available

1-19

to the auditor general (or his or her designee) upon request. The request for such information by

2-1

the auditor general shall be responded to promptly. Failure to provide this information shall

2-2

constitute a breach of contract by the audit firm. The auditor general shall have standing to bring

2-3

an action in the superior court to compel the audit firm to provide the information listed in this

2-4

section.

2-5

     (b) Notwithstanding any provision of law to the contrary contained in any general or

2-6

public law, rule or regulation, no person or firm shall serve as auditors or prepare audited

2-7

financial statements on behalf of the same municipality for more than seven (7) consecutive

2-8

years.

2-9

     SECTION 2. This act shall take effect upon passage.

=======

LC00663

========

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO TOWNS AND CITIES -- AUDIT OF ACCOUNTS AND INSTALLATION OF

SYSTEMS

***

3-1

     This act would require towns and cities to change auditors or auditing firms every seven

3-2

(7) years.

3-3

     This act would take effect upon passage.

=======

LC00663

=======