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Public Act 096-0963
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| HB4865 Enrolled |
LRB096 16895 MJR 32207 b |
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AN ACT concerning financial regulation.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Credit Union Act is amended by |
changing Sections 19 and 34 as follows:
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(205 ILCS 305/19) (from Ch. 17, par. 4420)
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Sec. 19. Meeting of members.
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(1) The annual meeting shall be held each
year during the |
months of January, February or March or such other month
as may |
be approved by the Department. The meeting shall be held at the
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time, place and in the manner set forth in the bylaws. Any |
special
meetings of the members of the credit union shall be |
held at the time, place
and in the manner set forth in the |
bylaws. Unless otherwise set forth in
this Act, quorum |
requirements for meetings of members shall be established
by a |
credit union in its bylaws. Notice of all meetings must be |
given by
the Secretary of the credit union at least 7 days |
before the date of such
meeting, either by handing a written or |
printed notice to each
member of the credit union, by mailing |
the notice to the member at his address
as listed on the books |
and records of the credit union, or by posting a
notice of the |
meeting in three conspicuous places, including the office
of |
the credit union.
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(2) On all questions and at all elections, except election |
of directors,
each member has one vote regardless of the number |
of his shares. There
shall be no voting by proxy except on the |
election of directors, proposals
for merger or voluntary |
dissolution. All voting on the election of directors
shall be |
by ballot, but when there is no contest, written ballots need |
not
be cast. The record date to be used for the purpose of |
determining which
members are entitled to notice of or to vote |
at any meeting of members,
may be fixed in advance by the |
directors on a date not more than 90 days
nor less than 10 days |
prior to the date of the meeting. If no record date
is fixed by |
the directors, the first day on which notice of the meeting
is |
given, mailed or posted is the record date.
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(3) Regardless of the number of shares owned by a society, |
association,
club, partnership, other credit union or |
corporation, having membership
in the credit union, it shall be |
entitled to only
one vote and it may be represented and have |
its vote cast by its
designated agent acting on its
behalf |
pursuant
to a resolution
adopted by the organization's board of |
directors or similar governing
authority;
provided that the |
credit union shall obtain a certified copy of such resolution
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before such vote may be cast. |
(4) A member may revoke a proxy by delivery to the credit |
union of a written statement to that effect, by execution of a |
subsequently dated proxy, or by attendance at a meeting and |
voting in person.
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(Source: P.A. 89-603, eff. 8-2-96.)
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(205 ILCS 305/34) (from Ch. 17, par. 4435)
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Sec. 34. Duties of Supervisory Committee. |
(1) The Supervisory Committee
shall make or cause to be |
made an annual internal audit of the books and
affairs of the |
credit union to determine that the credit union's accounting
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records and reports are prepared promptly and accurately |
reflect operations
and results, that internal controls are |
established and effectively
maintained to safeguard the assets |
of the credit union, and that the
policies, procedures and |
practices established by the Board of Directors
and management |
of the credit union are being properly administered. The
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Supervisory Committee shall submit a report of that audit to |
the Board
of Directors and a summary of that report to the |
members at the next annual
meeting of the credit union. It |
shall make or cause to be made such
supplementary audits as it |
deems necessary or as are required by the
Director or by the |
Board of Directors, and submit reports of these
supplementary |
audits to the Director or Board of Directors as applicable.
If |
the Supervisory Committee has not engaged a public accountant |
registered
by the Department of Professional Regulation to make |
the internal audit,
the Supervisory Committee or other |
officials of the credit union shall not
indicate or in any |
manner imply that such audit has been performed by a
public |
accountant or that the audit represents the independent opinion |
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of a
public accountant. The Committee must retain its tapes and |
working papers
of each internal audit for inspection by the |
Department. The report of this
audit must be made on a form |
approved by the Director. A copy of the report
must be promptly |
mailed to the Director.
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(2) The Supervisory Committee shall make or cause to be |
made at least
once each year a reasonable percentage |
verification of members' share and
loan accounts, consistent |
with rules promulgated by the Director.
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(3) The Supervisory Committee of a credit union with assets |
of
$5,000,000 or more shall engage a public accountant |
registered by the
Department of Professional Regulation to |
perform an annual external
independent audit of the credit |
union's financial statements in accordance
with generally |
accepted auditing standards. The Supervisory Committee of a
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credit union with assets of $3,000,000 or more, but less than |
$5,000,000,
shall engage a public accountant registered by the |
Department of
Professional Regulation to perform an external |
independent audit of the
credit union's financial statements in |
accordance with generally accepted
auditing standards at least |
once every 3 years. A copy of an external
independent audit |
shall be completed and mailed to the Director no later than 90 |
days after December 31 of each year; provided that a credit |
union or group of credit unions may obtain an extension of the |
due date upon application to and receipt of written approval |
from the Director upon completion. If the
annual internal audit |
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of such a credit union is conducted by a public
accountant |
registered by the Department of Professional Regulation and the
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annual internal audit is done in conjunction with the credit |
union's annual
external audit, the requirements of subsection |
(1) of this Section shall
be deemed met.
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(4) In determining the appropriate balance in the allowance |
for loan losses account, a credit union may determine its |
historical loss rate using a defined period of time of less |
than 5 years, provided that: |
(A) the methodology used to determine the defined |
period of time is formally documented in the credit union's |
policies and procedures and is appropriate to the credit |
union's size, business strategy, and loan portfolio |
characteristics and the economic environment of the areas |
and employers served by the credit union; |
(B) supporting documentation is maintained for the |
technique used to develop the credit union loss rates, |
including the period of time used to accumulate historical |
loss data and the factors considered in establishing the |
time frames; and |
(C) the external auditor conducting the credit union's |
financial statement audit has analyzed the methodology |
employed by the credit union and concludes that the |
financial statements, including the allowance for loan |
losses, are fairly stated in all material respects in |
accordance with U.S. Generally Accepted Accounting |