HB2352ham002 104TH GENERAL ASSEMBLY

Rep. Natalie A. Manley

Filed: 4/7/2025

10400HB2352ham002 LRB104 07611 RTM 25010 a

AMENDMENT TO HOUSE BILL 2352

AMENDMENT NO. ______. Amend House Bill 2352 by replacing everything after the enacting clause with the following:

"Section 5. The Governmental Account Audit Act is amended by changing Sections 1, 2, 3, 4, and 6 and by adding Section 3.5 as follows:

(50 ILCS 310/1) (from Ch. 85, par. 701)

Sec. 1. Definitions. As used in this Act, unless the context otherwise indicates:

"Governmental unit" or "unit" includes all municipal corporations in and political subdivisions of this State that appropriate more than $5,000 for a fiscal year, with the amount to increase or decrease by the amount of the Consumer Price Index (CPI) as reported on January 1 of each year, except the following:

(1) School districts.

(2) Cities, villages, and incorporated towns subject to the Municipal Auditing Law, as contained in the Illinois Municipal Code, and cities that file a report with the Comptroller under Section 3.1-35-115 of the Illinois Municipal Code.

(3) Counties with a population of 1,000,000 or more.

(4) Counties subject to the County Auditing Law.

(5) Any other municipal corporations in or political subdivisions of this State, the accounts of which are required by law to be audited by or under the direction of the Auditor General.

(6) (Blank).

(7) A drainage district, established under the Illinois Drainage Code (70 ILCS 605), that did not receive or expend any moneys during the immediately preceding fiscal year or obtains approval for assessments and expenditures through the circuit court.

(8) Public housing authorities that submit financial reports to the U.S. Department of Housing and Urban Development.

"Governing body" means the board or other body or officers having authority to levy taxes, make appropriations, authorize the expenditure of public funds or approve claims for any governmental unit.

"Comptroller" means the Comptroller of the State of Illinois.

"Consumer Price Index" means the Consumer Price Index for All Urban Consumers for all items published by the United States Department of Labor.

"Audit report" means the written report of the auditor and all appended statements and schedules relating to that report, presenting or recording the findings of an examination or audit of the financial transactions, affairs, or conditions of a governmental unit.

"Auditor" means a licensed certified public accountant, as that term is defined in Section 0.03 of the Illinois Public Accounting Act, or the substantial equivalent of a licensed CPA, as provided under Section 5.2 of the Illinois Public Accounting Act, who performs an audit of governmental unit financial statements and records and expresses an assurance or disclaims an opinion on the audited financial statements.

"Report" includes both audit reports and reports filed instead of an audit report by either a governmental unit receiving revenue of less than $850,000 during any fiscal year or a governmental unit described in Section 3.5 and to which the reports relate.

"Generally accepted accounting principles" means accounting principles generally accepted in the United States.

"Generally accepted auditing standards" means auditing standards generally accepted in the United States.

(Source: P.A. 100-837, eff. 8-13-18; 101-419, eff. 1-1-20.)

(50 ILCS 310/2) (from Ch. 85, par. 702)

Sec. 2. Except as otherwise provided in Section 3 and Section 3.5, the governing body of each governmental unit shall cause an audit of the accounts of the unit to be made by an auditor or auditors. Such audit shall be performed annually and shall cover the immediately preceding fiscal year of the governmental unit. The audit shall include all the accounts and funds of the governmental unit, including the accounts of any officer of the governmental unit who receives fees or handles funds of the unit or who spends money of the unit. The audit shall begin as soon as possible after the close of the last fiscal year to which it pertains, and shall be completed and the audit report filed with the Comptroller within 180 days after the close of such fiscal year unless an extension of time is granted by the Comptroller in writing. An audit report which fails to meet the requirements of this Act shall be rejected by the Comptroller and returned to the governing body of the governmental unit for corrective action. The auditor or auditors performing the audit shall submit not less than 3 copies of the audit report to the governing body of the governmental unit being audited.

All audits to be filed with the Comptroller under this Section must be submitted electronically and the Comptroller must post the audit reports on the Internet no later than 45 days after they are received. If the governmental unit provides the Comptroller's Office with sufficient evidence that the audit report cannot be filed electronically, the Comptroller may waive this requirement. The Comptroller must also post a list of governmental units that are not in compliance with the reporting requirements set forth in this Section.

Any financial report under this Section shall include the name of the purchasing agent who oversees all competitively bid contracts. If there is no purchasing agent, the name of the person responsible for oversight of all competitively bid contracts shall be listed.

(Source: P.A. 101-419, eff. 1-1-20.)

(50 ILCS 310/3) (from Ch. 85, par. 703)

Sec. 3. Except as provided in Section 3.5, any Any governmental unit receiving revenue of less than $850,000 for any fiscal year shall, in lieu of complying with the requirements of Section 2 for audits and audit reports, beginning with fiscal year 2016, either: (i) cause an audit of the accounts of the unit to be made once every 4 years and file with the Comptroller an annual financial report containing information required by the Comptroller, or (ii) file with the Comptroller an annual financial report containing information required by the Comptroller, a copy of which has been provided to each member of that governmental unit's board of elected officials, presented either in person or by a live phone or web connection during a public meeting, and approved by a 3/5 majority vote. In addition, a governmental unit receiving revenue of less than $850,000 or a governmental unit described in Section 3.5 may file with the Comptroller any audit reports which may have been prepared under any other law. Except as provided in Section 3.5, any Any governmental unit receiving revenue of $850,000 or more for any fiscal year shall, in addition to complying with the requirements of Section 2 for audits and audit reports, file with the Comptroller the financial report required by this Section. Such financial reports shall be on forms so designed by the Comptroller as not to require professional accounting services for its preparation. All reports to be filed with the Comptroller under this Section must be submitted electronically and the Comptroller must post the reports on the Internet no later than 45 days after they are received. If the governmental unit provides the Comptroller's Office with sufficient evidence that the report cannot be filed electronically, the Comptroller may waive this requirement. The Comptroller must also post a list of governmental units that are not in compliance with the reporting requirements set forth in this Section.

Any financial report under this Section shall include the name of the purchasing agent who oversees all competitively bid contracts. If there is no purchasing agent, the name of the person responsible for oversight of all competitively bid contracts shall be listed.

(Source: P.A. 97-890, eff. 8-2-12; 97-1142, eff. 12-28-12; 98-1019, eff. 7-1-15.)

(50 ILCS 310/3.5 new)

Sec. 3.5. Audit thresholds for certain governmental units. Notwithstanding any provision of this Act to the contrary, a park district, forest preserve district, or conservation district shall not be required to conduct an audit under this Act for any fiscal year that ends on or after January 1, 2027 unless the park district, forest preserve district, or conservation district receives revenue in excess of $1,500,000 for that fiscal year. Any park district, forest preserve district, or conservation district that is not required to conduct an audit under this Act because the district did not meet the revenue requirements of this Section shall, in lieu of an audit, file an annual financial report with the Comptroller in accordance with the requirements of Section 3.

(50 ILCS 310/4) (from Ch. 85, par. 704)

Sec. 4. Overdue report.

(a) If the required report for a governmental unit is not filed with the Comptroller in accordance with Section 2, or Section 3, or Section 3.5, whichever is applicable, within 180 days after the close of the fiscal year of the governmental unit, the Comptroller shall notify the governing body of that unit in writing that the report is due and may also grant a 60-day extension for the filing of the audit report. If the required report is not filed within the time specified in such written notice, the Comptroller shall cause an audit to be made by an auditor, and the governmental unit shall pay to the Comptroller actual compensation and expenses to reimburse him or her for the cost of preparing or completing such report.

(b) The Comptroller may decline to order an audit and the preparation of an audit report (i) if an initial examination of the books and records of the governmental unit indicates that the books and records of the governmental unit are inadequate or unavailable due to the passage of time or the occurrence of a natural disaster or (ii) if the Comptroller determines that the cost of an audit would impose an unreasonable financial burden on the governmental unit.

(c) The State Comptroller may grant extensions for delinquent audits or reports. The Comptroller may charge a governmental unit a fee for a delinquent audit or report of $5 per day for the first 15 days past due, $10 per day for 16 through 30 days past due, $15 per day for 31 through 45 days past due, and $20 per day for the 46th day and every day thereafter. These amounts may be reduced at the Comptroller's discretion. All fees collected under this subsection (c) shall be deposited into the Comptroller's Administrative Fund.

(Source: P.A. 101-419, eff. 1-1-20; 102-558, eff. 8-20-21.)

(50 ILCS 310/6) (from Ch. 85, par. 706)

Sec. 6. When the audit is completed the auditor making such audit shall make and sign at least 3 copies of the report of the audit and immediately file them with the governmental unit audited. Except as provided under Section 3.5, governmental Governmental units receiving revenue of $850,000 or more for any fiscal year shall immediately make one copy of the audit report and one copy of the financial report required by Section 3 of this Act a part of its public record. Except as provided under Section 3.5, governmental Governmental units receiving revenue of less than $850,000 shall immediately make one copy of the audit report, or one copy of the report authorized by Section 3 of this Act to be filed instead of the audit report, a part of its public record. These copies shall be open to public inspection. In addition, the governmental unit shall file one copy of the report with the Comptroller and with the county clerk of the county in which the principal office of the governmental unit is located. A governmental unit may, in filing its audit report with the Comptroller, transmit with such report any comment or explanation that it wishes to make concerning the report.

(Source: P.A. 101-419, eff. 1-1-20.)

Section 99. Effective date. This Act takes effect upon becoming law.".