DAR File No. 38183
This rule was published in the January 1, 2014, issue (Vol. 2014, No. 1) of the Utah State Bulletin.
Utah State Board of Education Internal Audit Procedure
Notice of Proposed Rule
DAR File No.: 38183
Filed: 12/16/2013 01:37:24 PM
Purpose of the rule or reason for the change:
This rule is amended to add additional Internal Auditor authority and responsibilities.
Summary of the rule or change:
The amendments add a requirement for the Internal Auditor to manage the responsibilities of a statewide hotline for fraud, waste, and abuse involving programs and entities supervised by the Utah State Board of Education and to meet semi-annually with the Board Audit Committee Chair.
State statutory or constitutional authorization for this rule:
- Subsection 53A-1-402(1)(e)
- Subsection 53A-1-401(3)
Anticipated cost or savings to:
the state budget:
There is no anticipated cost or savings to the state budget. The additional requirements of the Internal Auditor will be administered with existing staff and within existing budgets.
There is no anticipated cost or savings to local government. The additional requirements of the Internal Auditor do not involve school districts or schools.
There is no anticipated cost or savings to small businesses. This rule and the amendments apply to public education and do not affect businesses.
persons other than small businesses, businesses, or local governmental entities:
There is no anticipated cost or savings to persons other than small businesses, businesses, or local government entities. The additional requirements apply to the Internal Auditor.
Compliance costs for affected persons:
There is no compliance costs for affected persons. The Internal Auditor will manage the additional requirements as directed by this rule.
Comments by the department head on the fiscal impact the rule may have on businesses:
I have reviewed this rule and I see no fiscal impact on businesses.
Martell Menlove, State Superintendent
The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:Education
250 E 500 S
SALT LAKE CITY, UT 84111-3272
Direct questions regarding this rule to:
- Carol Lear at the above address, by phone at 801-538-7835, by FAX at 801-538-7768, or by Internet E-mail at firstname.lastname@example.org
Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:
This rule may become effective on:
Carol Lear, Director, School Law and Legislation
R277. Education, Administration.
R277-116. Utah State Board of Education Internal Audit Procedure.
A. "Appointing authority" means the Board.
B. "Audit" means internal reviews or analyses or a combination of both of Utah State Board of Education programs, activities and functions that may address one or more of the following objectives:
(1) to verify the accuracy and reliability of USOE or Board records;
(2) to assess compliance with management policies, plans, procedures, and regulations;
(3) to assess compliance with applicable laws, rules and regulations;
(4) to evaluate the efficient and effective use and protection of Board, state, or federal resources; or
(5) to verify the appropriate protection of USOE assets;
(6) to review and evaluate internal controls over LEA and USOE accounting systems, administrative systems, electronic data processing systems, and all other major systems necessary to ensure the fiscal and administrative accountability of LEAs and the USOE.
C. "Audit Committee" means a standing committee appointed by the Board which shall consist of all members of the Finance Committee. The Chair of the Audit Committee shall be either the Board Chair or Board Vice Chair.
D. "Board" means the Utah State Board of Education.
E. "Internal Auditor" means person or persons appointed by the Superintendent with the consent of the Audit Committee and the full Board to direct the internal audit function for the Board and USOE.
F. "LEA," for purposes of this
rule, means any local education agency under the supervision of the
Board including any sub unit of school districts, Utah Schools for
the Deaf and the Blind, [
Utah State Office of Rehabilitation,] charter schools[ , regional service centers, area technology centers and
G]. "Superintendent" means the State Superintendent
of Public Instruction, who is the Agency Head within the meaning of
the Utah Internal Audit Act.
H]. "Survey work" means an internal review of Board
rules, statutes, federal requirements and a limited sample of an
LEA's programs, activities or documentation that may give rise
to or refute the need for a more comprehensive audit. The
preliminary or limited information derived from survey work is a
part of the ongoing audit process and may be provided as a draft to
the Audit Committee, to the Board or to the Superintendent upon
I]. "USOE" means the Utah State Office of
R277-116-2. Authority and Purpose.
A. This rule is authorized by Utah Constitution Article X, Section 3 which vests general control and supervision of public education in the Board, Section 53A-1-401(3) which allows the Board to adopt rules in accordance with its responsibilities, Section 53A-1-405 which makes the Board responsible for verifying audits of local school districts, Section 53A-1-402(1)(e) which directs the Board to develop rules and minimum standards regarding cost effectiveness measures, school budget formats and financial accounting requirements for the local school districts, Section 53A-17a-147(2) which directs the Board to assess the progress and effectiveness of local school districts and programs funded under the Minimum School Program and report its findings to the Legislature, and by Section 63I-5-101 through 401 which provides standards and procedures for the Board, as the appointing authority for the USOE, to establish an internal audit program.
B. The purpose of this rule is to outline the Board's criteria and procedures for internal audits of programs under its supervision.
R277-116-3. Audit Committee Responsibilities.
The Audit Committee shall:
A. determine the priority for survey work or audits to be performed based on recommendations from the Internal Auditor, Audit Committee requests or correspondence, other Board member requests, or USOE staff recommendations;
B. consent to the appointment or removal of the Internal Auditor.
C. review and approve the annual internal audit plan and budget;
D. review internal and external audit reports, survey work, follow-up reports, and quality assurance reviews of the Internal Auditor;
E. meet at each regularly scheduled Board meeting with the Internal Auditor to discuss ongoing audits, audit priorities and progress, and other issues;
F. distribute drafts or preliminary versions of audits only to Board members, as requested, or auditees. Internal audits that have not been reviewed in final form by the Audit Committee, the auditee, and the Board are drafts and, as such, are not public records;
G. determine the distribution of audit findings in any or all stages or reports to other Board members as well as to other interested parties;
H. review the findings and recommendations of the Internal Auditor and make recommendations for action on the findings to the Board; and
I. evaluate the Internal Auditor at least annually in a formal evaluation process.
R277-116-4. Internal Auditor Authority and Responsibilities.
A. The Internal Auditor shall work closely with and receive regular supervision from the Superintendent.
B. The Internal Auditor shall report initially to the Superintendent. Following the Superintendent's response, the Internal Auditor reports to the Audit Committee and ultimately to the Board.
C. The Internal Auditor's work shall be determined primarily by a risk assessment developed by the Internal Auditor and approved by the Audit Committee at least annually. The risk assessment shall:
(1) consider public education programs for which the Board has responsibility;
(2) consider and evaluate which public education programs, activities or responsibilities are most critical to:
(a) student safety;
(b) student achievement;
(c) efficient management of public
(d) the priorities of public education as
determined by the Board[
D. The Internal Auditor shall meet with the Audit Committee or the Board, at the direction of either, to inform both the Audit Committee and the Board of progress on assigned audits and any additional information or assignments requested by the Audit Committee or the Board.
E. The Internal Auditor shall conduct
audits as recommended by the Audit Committee, and as directed by
the Board, including economy and efficiency audits, program audits,
and financial-related audits of any [
program, ]function, LEA, or [ division] under the Board's supervision, or as otherwise
directed by the Board.
F]. The Internal Auditor shall immediately notify the Audit
Committee and the Board of any irregularity or serious deficiency
discovered in the audit process or of any impediment or conflict to
accomplishing an audit as directed by the Board.
G]. The Internal Auditor shall submit a written report to the
Audit Committee and the Board of each authorized audit within a
reasonable time after completion of the audit.
H]. The Internal Auditor shall maintain the classification of
any public records consistent with Title 63G, Chapter 2, Government
Records Access and Management Act.
I]. Audit Committee members, Board members and USOE employees
shall maintain information acquired in the audit process in the
strictest confidence consistent with the Public Employees Ethics
Act, Section 67-1[ 4]-4.
J]. The Internal Auditor shall have access to all records,
personnel, and physical materials relevant and necessary to conduct
audits of all programs and agencies supervised by the Board. All
public education entities shall cooperate fully with Internal
Auditor requests; The Internal Auditor is not required to issue
subpoenas or make GRAMA requests under Section 63G-2-202 to receive
requested information from public education entities.
R277-116-5. Audit Plans.
A. An audit plan shall be prepared by the Internal Auditor and shall:
(1) be reviewed regularly by both the Superintendent and the Audit Committee;
(2) identify the individual audits to be conducted during each year;
(3) determine the adequacy and efficiency of the USOE's internal monitoring and control of programs and personnel;
(4) identify the related resources to be devoted to each of the respective audits; and
(5) ensure that audits that evaluate the efficient and effective use of public education resources are adequately represented in the plan.
B. The Internal Auditor shall submit the audit plan first to the Superintendent for review, next to the Audit Committee for review, modification, update, and approval. Each audit plan shall expressly state an anticipated completion date.
C. The Internal Auditor shall:
(1) ensure that audits are conducted in accordance with professional auditing standards such as those published by the Institute of Internal Auditors, Inc., the American Institute of Certified Public Accountants, and, when required by other law, regulation, agreement, contract, or policy, in accordance with Government Auditing Standards, issued by the Comptroller General of the United States;
(a) all reports of audit findings issued by internal audit staff shall include a statement that the audit was conducted according to the appropriate standards;
(b) public release of reports of audit findings shall comply with the conditions specified by state laws and rules governing the USOE.
(2) report concerns to the Audit Committee or the Board that arise as the result of survey work or audits that necessitate a direct review of the Superintendent's activities or actions;
(3) report significant audit matters that cannot be appropriately addressed by the Audit Committee and the Board to either the Office of Legislative Auditor General or the Office of the State Auditor;
(4) report quarterly to the full Board those issues which have the potential of opening up the Board, Superintendent, or USOE to liability or litigation;
(5) conduct at least annually a risk assessment of the entire public education system and report the findings to the Audit Committee; and
(6) regularly attend all Board meetings.
KEY: educational administration
Date of Enactment or Last Substantive Amendment: [
September 21, 2012]
Notice of Continuation: December 16, 2013
Authorizing, and Implemented or Interpreted Law: Art X Sec 3; 53A-1-401(3); 53A-1-405; 53A-1-402(1)(e); 53A-17a-147(2); 63I-5-101 through 401
More information about a Notice of Proposed Rule is available online.
The Portable Document Format (PDF) version of the Bulletin is the official version. The PDF version of this issue is available at https://rules.utah.gov/publicat/bull-pdf/2014/b20140101.pdf. The HTML edition of the Bulletin is a convenience copy. Any discrepancy between the PDF version and HTML version is resolved in favor of the PDF version.
Text to be deleted is struck through and surrounded by brackets ([
example]). Text to be added is underlined (). Older browsers may not depict some or any of these attributes on the screen or when the document is printed.
For questions regarding the content or application of this rule, please contact Carol Lear at the above address, by phone at 801-538-7835, by FAX at 801-538-7768, or by Internet E-mail at email@example.com.