Assembly Republicans Demand State Controller’s Audit Records

Assembly Republican Leader Alexandra Macedo and GOP Assembly members Carl DeMaio, Stan Ellis, Tri Ta, Kate Sanchez, David Tangipa, Natasha Johnson, Leticia Castillo sent State Controller Malia Cohen a letter asking her to disclose records showing how her office reviews and audits claims before taxpayer money is paid.

Candidate for Controller, Herb W. Morgan is backing their demand, and notes, “The Controller is supposed to be the last line of defense before taxpayer money leaves the Treasury.”

The letter says, “You told voters you would audit homelessness spending, the Employment Development Department, and the Department ofMotor Vehicles. You later told the Los Angeles Times you did not audit EDD or the DMV because other bodies were already looking. Concurrent review by someone else is not the constitutional standard. Your spokesman, Bismarck Obando, stated on video released by O’Keefe Media Group that critical audits ‘are not getting done” and “we just can’t conduct the audits.’

California’s annual financial reporting has repeatedly missed the federal Single Audit window. Late books are not paperwork inconvenience. They are evidence that the chief fiscal officer is not superintending the fiscal concerns of the state as required.”

The lawmakers are seeking the number of claims paid in fiscal years 2023-24, 2024-25 and 2025-26, along with the number that received a field or detailed audit under Government Code Section 12410 before a warrant was issued.

They asked for:

• How many claims were paid in FY 2023–24, 2024–25, and 2025–26
• How many of those received a field or detailed audit under Government Code §12410 before a warrant was issued
• Audit records since January 2023 covering homelessness programs, EDD, DMV, Medi-Cal-related payments, and nonprofit grantees
• Any written policy that lets an agency, vendor, or grantee attestation stand in for a Controller’s audit
• How a warrant can be “duly drawn” under the California Constitution if the claim was not audited by the Controller

They requested records of audits completed since January 2023 involving homelessness programs, the Employment Development Department, the Department of Motor Vehicles, Medi-Cal-related disbursements and nonprofit recipients of state funds.

The letter asks Cohen to identify any written policy allowing an agency, vendor or grantee attestation to substitute for an audit by the Controller’s Office.

Government Code §12410 says the Controller “shall audit all claims against the state, and may audit the disbursement of any state money,” and may do a field or other audit if the ordinary claims review is not adequate.

Government Code §925.6 says the Controller shall not draw a warrant until the claim has been audited in conformity with law and departmental rules.

The Constitution (Art. XVI, §7) says money may leave the Treasury only on a Controller’s “duly drawn warrant.”

The important nuance: “audit all claims” in practice has long meant a pre-payment claims review (authorization, appropriation, documentation), not a full field audit of every payment. Field audits are discretionary when the Controller thinks the paper review is inadequate.

Their letter presses Cohen to show how often that extra step actually happens, and whether attestation is being treated as a substitute.

“The Controller is supposed to be the last line of defense before taxpayer money leaves the Treasury,” Morgan said. “If the law requires claims to be audited before payment, Californians deserve to know whether those audits actually happened. This is not complicated. Produce the number of claims paid, produce the number that were audited, and produce the policy the office followed. If the work was done, show it. If it was not, taxpayers deserve to know why public money was allowed to move without the safeguard the law requires.”

Morgan’s support for the Republicans’ letter is a given, with his campaign theme of “radical transparency,” missed Single Audit deadlines, homelessness and Medi-Cal oversight, and the O’Keefe clip in which the Controller’s spokesman said audits “are not getting done.”

“Taxpayers should not have to guess whether the state’s financial controls are working,” Morgan said. “Show the records, show the audits and let the public see the receipts.”

“If the office cannot produce that verification, we look forward to the reasoning as to why. The Constitution did not create a Controller so Sacramento could pay first and ask questions never,” the Assembly Republicans say.

Republicans are seeking a written answer within 14 days.