SB173_EN

Senate Bill No. 173–Committee on
Government Affairs

CHAPTER..........

AN ACT relating to state financial administration; exempting certain licensing boards from the State Budget Act and certain provisions governing financial administration; and providing other matters properly relating thereto.

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. NRS 353.005 is hereby amended to read as follows:

353.005 The provisions of this chapter do not apply to boards

created [pursuant to] by the provisions of chapters 623 to 625A,

inclusive, 628, 630 to 640A, inclusive, 641 to 644, inclusive, 648,

654 and 656 of NRS and NRS 590.485 and the officers and

employees [thereof.] of those boards.

Sec. 2. NRS 353A.020 is hereby amended to read as follows:

353A.020 1. The Director, in consultation with the

Committee and Legislative Auditor, shall adopt a uniform system

of internal accounting and administrative control for agencies. The

elements of the system must include, without limitation:

(a) A plan of organization which provides for a segregation of

duties appropriate to safeguard the assets of the agency;

(b) A plan which limits access to assets of the agency to persons

who need the assets to perform their assigned duties;

effectively control accounting of assets, liabilities, revenues and

expenses;

(d) A system of practices to be followed in the performance of

the duties and functions of each agency; and

(e) An effective system of internal review.

2. The Director, in consultation with the Committee and

Legislative Auditor, may modify the system whenever he considers

it necessary.

3. Each agency shall develop written procedures to carry out

the system of internal accounting and administrative control

adopted pursuant to this section.

4. For the purposes of this section, “agency” does not include:

(a) A board created by the provisions of chapters 623 to 625A,

inclusive, 628, 630 to 640A, inclusive, 641 to 644, inclusive, 648,

654 and 656 of NRS[.] and NRS 590.485.

(b) The University and Community College System of Nevada.

(d) The Housing Division of the Department of Business and

Industry.

(e) The Colorado River Commission of Nevada.

Sec. 3. NRS 353A.025 is hereby amended to read as follows:

353A.025 1. The head of each agency shall periodically

review the agency’s system of internal accounting and

administrative control to determine whether it is in compliance with

the uniform system of internal accounting and administrative

control for agencies adopted pursuant to subsection 1 of NRS

353A.020.

2. On or before July 1 of each even-numbered year, the head of

each agency shall report to the Director whether the agency’s

system of internal accounting and administrative control is in

compliance with the uniform system adopted pursuant to subsection

1 of NRS 353A.020. The reports must be made available for

inspection by the members of the Legislature.

3. For the purposes of this section, “agency” does not include:

(a) A board created by the provisions of chapters 623 to 625A,

inclusive, 628, 630 to 640A, inclusive, 641 to 644, inclusive, 648,

654 and 656 of NRS[.] and NRS 590.485.

(b) The University and Community College System of Nevada.

(d) The Housing Division of the Department of Business and

Industry.

(e) The Colorado River Commission of Nevada.

4. The Director shall, on or before the first Monday in

February of each odd-numbered year, submit a report on the status

of internal accounting and administrative controls in agencies to

the:

(a) Director of the Legislative Counsel Bureau for transmittal to

the:

(1) Senate Standing Committee on Finance; and

(2) Assembly Standing Committee on Ways and Means;

(b) Governor; and

5. The report submitted by the Director pursuant to subsection

4 must include, without limitation:

(a) The identification of each agency that has not complied with

the requirements of subsections 1 and 2;

(b) The identification of each agency that does not have an

effective method for reviewing its system of internal accounting

and administrative control; and

system of internal accounting and administrative control, and the

extent and types of such weaknesses.

Sec. 4. NRS 353A.045 is hereby amended to read as follows:

353A.045 The Chief shall:

1. Report to the Director.

2. Develop long-term and annual work plans to be based on the

results of periodic documented risk assessments. The annual work

plan must list the agencies to which the Division will provide

training and assistance and be submitted to the Director for

approval. Such agencies must not include:

(a) A board created by the provisions of chapters 623 to 625A,

inclusive, 628, 630 to 640A, inclusive, 641 to 644, inclusive, 648,

654 and 656 of NRS[.] and NRS 590.485.

(b) The University and Community College System of Nevada.

(d) The Housing Division of the Department of Business and

Industry.

(e) The Colorado River Commission of Nevada.

3. Provide a copy of the approved annual work plan to the

Legislative Auditor.

4. In consultation with the Director, prepare a plan for auditing

executive branch agencies for each fiscal year and present the plan

to the Committee for its review and approval. Each plan for

auditing must:

(a) State the agencies which will be audited, the proposed scope

and assignment of those audits and the related resources which will

be used for those audits; and

(b) Ensure that the internal accounting, administrative controls

and financial management of each agency are reviewed

periodically.

5. Perform the audits of the programs and activities of the

agencies in accordance with the plan approved pursuant to

subsection 5 of NRS 353A.038 and prepare audit reports of his

findings.

6. Review each agency that is audited pursuant to subsection 5

and advise those agencies concerning internal accounting,

administrative controls and financial management.

7. Submit to each agency that is audited pursuant to subsection

5 analyses, appraisals and recommendations concerning:

(a) The adequacy of the internal accounting and administrative

controls of the agency; and

(b) The efficiency and effectiveness of the management of the

agency.

8. Report any possible abuses, illegal actions, errors, omissions

and conflicts of interest of which the Division becomes aware

during the performance of an audit.

9. Adopt the standards of the Institute of Internal Auditors for

conducting and reporting on audits.

10. Consult with the Legislative Auditor concerning the plan

for auditing and the scope of audits to avoid duplication of effort

and undue disruption of the functions of agencies that are audited

pursuant to subsection 5.

11. Appoint a Manager of Internal Controls.

Sec. 5. NRS 218.825 is hereby amended to read as follows:

218.825 1. Each of the boards [and commissions] created by

the provisions of chapters 623 to 625A, inclusive, 628 , 630 to

640A, inclusive, 641 to 644, inclusive, [and 641C,] 648, 654 and

656 of NRS and NRS 590.485 shall engage the services of a

certified public accountant or public accountant, or firm of either of

such accountants, to audit all its fiscal records once each year for

the preceding fiscal year or once every other year for the 2

preceding fiscal years. The cost of the audit must be paid by the

board [or commission] audited.

2. A report of each such audit must be filed by the board [or

commission] with the Legislative Auditor and the [director of the

budget] Chief of the Budget Division of the Department of

Administration on or before December 1 of each year in which an

audit is conducted. All audits must be conducted in accordance with

generally accepted auditing standards , and all financial statements

must be prepared in accordance with generally accepted principles

of accounting for special revenue funds.

3. The Legislative Auditor shall audit the fiscal records of any

such board [or commission] whenever directed to do so by the

Legislative Commission. When the Legislative Commission directs

such an audit, [it] the Legislative Commission shall also determine

who is to pay the cost of the audit.

Sec. 6. This act becomes effective on July 1, 2003.

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