BILL ANALYSIS                                                                                                                                                                                                    



                                                                     AB 255


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          Date of Hearing:  May 13, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          255 (Irwin) - As Amended April 23, 2015


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          |Policy       |Veterans Affairs               |Vote:|8 - 1        |
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          |             |Accountability and             |     |9 - 0        |
          |             |Administrative Review          |     |             |
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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:


          This bill creates the office of Internal Audits for Veterans  
          Affairs within the California Department of Veterans Affairs  
          (CalVet).  Specifically, this bill:  








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          1)Establishes the office, led by the chief auditor (auditor),  
            who would be subject to appointment by the Governor and  
            confirmation by the Senate.


          2)Requires the auditor to report to the CalVet secretary  
            (secretary) and conduct reviews and investigations at the  
            request of the secretary or other members of senior  
            management.


          3)Requires the auditor to report findings of employee misconduct  
            to the secretary.


          4)Subjects the auditor to specified sections of Government Code  
            related to internal auditors' independence and  
            responsibilities.


          5)Allows the auditor to initiate a review or investigation of an  
            alleged wrongdoing.


          6)Requires the auditor, beginning January 1, 2017, and each year  
            thereafter, to submit an annual summary report to the  
            California Veterans Board and relevant policy committees of  
            the Legislature.


          7)Includes a January 1, 2020 sunset.   


          FISCAL EFFECT:


            Moderate ongoing costs, in the range of $500,000 to $750,000  








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            (GF), to CalVets to staff an audit unit. and submit the  
            required reports.


          COMMENTS:


          1)Purpose.  According to the author, the intent of this bill is  
            for the auditor to work with CalVet leadership to improve the  
            department's operations and efficiency while providing  
            additional accountability.


          2)Background.  While the department does not have an internal  
            audit office, it has had an inspector general (IG) in the  
            past.  The IG was established in 1999, but it was eliminated  
            in 2004 Budget Act.  According to analyses of that Budget Act,  
            some of the oversight functions of the IG were expected to be  
            performed by other state entities, including the Bureau of  
            State Audits and Department of Finance.  While both entities  
            have conducted several audits of CalVet programs and issues,  
            there is not an internal audit function at CalVet that reviews  
            the department's programs and operations on an ongoing basis. 


            This bill will establish an internal auditor's office within  
            CalVet.  The auditor will be appointed by the Governor subject  
            to Senate confirmation, report to the secretary, and conduct  
            reviews and investigations at the discretion of the secretary  
            and senior management.





          Analysis Prepared by:Pedro R. Reyes / APPR. / (916)  
          319-2081










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