Complying with the Federal Single Audit Act

Government Code Section 13070.5 requires the Department of Finance (DOF) to ensure the State of California carries out its responsibilities in accordance with the federal Single Audit Act (31 U.S.C. Sec. 7501 et seq.).

In that regard, the DOF is required do all of the following:

• Act as the liaison between state agencies, the California State Auditor, and other relevant federal agencies.

• Establish guidelines and instructions for state agencies pursuant to this section.

• Collect financial information related to federal awards received, including schedules of cash and noncash federal assistance and passthrough amounts.

• Collect nonfinancial information related to federal awards received, including prior audit findings and management representation letters.

• Review and consolidate the financial and nonfinancial information from state agencies and prepare the Schedule of Federal Awards and related schedules.

• Upload the completed Single Audit Report to the Federal Clearinghouse on behalf of the state.

Section 13071 makes the Director of Finance be responsible for coordinating state agency internal audits and identifying when agencies are required to comply with federally mandated audits. The Director of Finance, in coordinating the internal auditors of state agencies, is required to ensure that these auditors utilize the “Standards for the Professional Practices of Internal Auditing.”