H-1641              _______________________________________________

                                                    HOUSE BILL NO. 928

                        _______________________________________________

State of Washington                              49th Legislature                              1985 Regular Session

By Representatives Silver, B. Williams, L. Smith, Holland, Lewis, Schoon, May, Thomas and Kremen

Read first time 2/8/85 and referred to Committee on State Government.

AN ACT Relating to budget and accounting; and adding a new section to chapter 43.88 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.  A new section is added to chapter 43.88 RCW to read as follows:

          (1) Internal accounting and administrative controls of each executive agency shall be established in accordance with standards prescribed by the director of financial management and shall provide reasonable assurances that:

          (a) Obligations and costs are in compliance with applicable law;

          (b) Funds, property, and other assets are safeguarded against waste, loss, unauthorized use, or misappropriation; and

          (c) Revenues and expenditures applicable to agency operations are properly recorded and accounted for to permit the preparation of accounts and reliable financial and statistical reports and to maintain accountability over the assets.

          (2) The standards prescribed by the director under this section shall include standards to ensure the prompt resolution of all audit findings.

          (3) By December 31, 1985, the director of financial management, in consultation with the state auditor, shall establish guidelines for the evaluation by agencies of their systems of internal accounting and administrative control to determine such systems' compliance with the requirements of subsection (1) of this section.  The director, in consultation with the state auditor, may modify such guidelines from time to time as deemed necessary.

          (4) By December 31, 1986, and by December 31 of each succeeding year, the head of each executive agency shall, on the basis of an evaluation conducted in accordance with guidelines prescribed under subsection (3) of this section, prepare a statement:

          (a) That the agency's systems of internal accounting and administrative control fully comply with the requirements of subsection (1) of this section; or

          (b) That such systems do not fully comply with such requirements.

          (5) In the event that the head of an agency prepares a statement described in subsection (3)(b) of this section, the head of such agency shall include with such statement a report in which any material weaknesses in the agency's systems of internal accounting and administrative control are identified and the plans and schedule for correcting any such weakness are described.

          (6) The statements and reports required by this section shall be signed by the head of each executive agency and transmitted to the governor and the legislature.  The statements and reports shall also be made available to the public, except that, in the case of any such statement or report containing information which is specifically prohibited from disclosure by any provision of law, such information shall be deleted prior to the report or statement being made available to the public.