BILL NUMBER: AB 1487 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 21, 2012
INTRODUCED BY Committee on Budget (Blumenfield (Chair), Alejo,
Bonilla, Brownley, Buchanan, Butler, Cedillo, Chesbro, Dickinson,
Feuer, Gordon, Huffman, Mitchell, Monning, and Swanson)
JANUARY 10, 2012
An act relating to the Budget Act of 2012.
An act to amend Sections 12460 and 12461 of, and to add Section
13344 to, the Government Code, relating to state government, and
making an appropriation therefor, to take effect immediately, bill
related to the budget.
LEGISLATIVE COUNSEL'S DIGEST
AB 1487, as amended, Committee on Budget. Budget Act of
2012. State government: state funds.
Existing law requires every state agency and court for which an
appropriation has been made to submit to the Department of Finance
for approval, a complete and detailed budget at such time and in such
form as may be prescribed by the department, setting forth all
proposed expenditures and estimated revenues for the ensuing fiscal
year. Existing law requires the Department of Finance to, among other
things, develop, issue, and implement consistent and adequate
guidelines to be utilized by agencies required to submit budgets to
the department.
Existing law requires the Governor's Budget to be prepared in
accordance with guidelines and instructions adopted by the Department
of Finance. Existing law requires the Governor's Budget to also
include a coding structure that indicates for each budget entity the
categorization of expenditures and revenues. Existing law requires
the Department of Finance to develop a fiscal information system that
will provide timely and uniform fiscal data needed to formulate and
monitor the budget, as specified.
Existing law requires the Controller to submit an annual report to
the Governor containing a statement of the funds of the state, its
revenues, and the public expenditures during the preceding fiscal
year. Existing law requires the annual report to be prepared in the
manner that will account for revenues and expenditures on the same
basis as that of the Governor's Budget and the Budget Act. Existing
law requires the annual report to be prepared in accordance with
"Generally Accepted Accounting Principles."
This bill would require the Controller to submit a new annual
report to the Governor, to be referred to as the budgetary-legal
basis annual report. The bill would require the budgetary-legal basis
annual report to account for prior year adjustments, fund balances,
encumbrances, deferred payroll, revenues, expenditures, and other
components on the same basis as that of the applicable Governor's
Budget and Budget Act. The bill would require the Controller to
confer with the Department of Finance to propose and develop methods
to facilitate these changes. The bill would require the annual
reports of the Controller to be posted on the Internet Web site of
the Controller, and would authorize the Controller to charge a
reasonable fee for providing copies of those reports, not to exceed
the costs thereof.
The bill would also require every state agency, as defined, to
prepare and maintain financial and accounting data for inclusion in
the Governor's Budget, Budget Act and related documents, and the
budgetary-legal basis annual report, according to methods adopted by
the Department of Finance. The bill would require the Department of
Finance to implement procedures that facilitate annual
reconciliations of General Fund and special fund balances between
those provided by a state agency to the Department of Finance and the
Controller. The bill would exempt from the Administrative Procedure
Act, actions taken by the Department of Finance to implement these
provisions.
This bill would appropriate $1,000 from the General Fund to the
Department of Finance for purposes of implementing this bill, thereby
making an appropriation.
This bill would declare that it is to take effect immediately as a
bill providing for appropriations related to the Budget Bill.
This bill would express the intent of the Legislature to enact
statutory changes relating to the Budget Act of 2012.
Vote: majority. Appropriation: no yes
. Fiscal committee: no yes .
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature hereby finds and
declares as follows:
(a) A principal purpose of the Governor's Budget documents, the
state's budgetary-legal basis annual reports, and the state's
comprehensive annual financial reports is the provision of accurate,
comprehensible, consistent, and informative data to the public, the
Legislature, other state policymakers, federal and local governments,
capital markets participants, and other external entities. It is the
intent of the Legislature that the Controller and the Director of
Finance ensure that these documents are prepared in a manner that
presents accurate state financial information. The state continues to
place a high priority on presenting its comprehensive annual
financial reports in conformity with accounting principles generally
accepted for state and local governments ("Generally Accepted
Accounting Principles" or GAAP).
(b) State agencies and departments, working cooperatively with the
Department of Finance and the Controller, must ensure that budgetary
documents and the state's budgetary-legal basis annual reports are
prepared in a manner that provides for the comparability of financial
data between these documents and ensures that the information
presented to the Legislature concerning the historical budgetary
position of the state's funds and accounts is accurate in all
material respects.
SEC. 2. Section 12460 of the Government
Code is amended to read:
12460. The Controller shall submit an annual report to the
Governor containing a statement of the funds of the state, its
revenues, and the public expenditures during the preceding fiscal
year. The annual report shall be known as the budgetary-legal
basis annual report and prepared in the
a manner that will account for prior year adjustments,
fund balances, encumbrances, deferred payroll, revenues
and , expenditures , and other
components on the same basis as that of the applicable
Governor's Budget and the applicable Budget Act
, as determined by the Director of Finance in consultation with the
Controller . The format of the budgetary-legal report
shall be prepared as closely as possible in accordance with
"Generally Accepted Accounting Principles." If the
Governor's Budget or the Budget Act do not provide the applicable
information for this purpose, funds shall be accounted for in the
budgetary-legal basis annual report in a manner prescribed by Section
13344. The requirements of this section shall apply beginning with
the issuance of the budgetary-legal basis annual report for the
2013-14 fiscal year. The Controller shall confer with the Department
of Finance to propose and develop methods to facilitate these changes
pursuant to Section 13344, including methods to ensure that
information related to encumbrances and deferred payroll continue to
be listed in the state's financial statements, as deemed appropriate
by the Controller.
Until the Controller's records, the Budget Act, and information
provided by each state department and agency based on the state's
accounting system will permit the conversion to "Generally Accepted
Accounting Principles," the
The Controller shall also issue an
additional a comprehensive annual financial
report prepared strictly in accordance with "Generally Accepted
Accounting Principles." The additional report will be
prepared annually unless the Director of Finance and the Controller
agree that such additional report is not feasible and so notify the
Joint Legislative Audit Committee.
The annual report reports referenced in
this section shall be compiled and published by the Controller
in the time, form, and manner prescribed by him or her.
SEC. 3. Section 12461 of the Government
Code is amended to read:
12461. The Controller's Controller shall
release an annual report shall include:
that includes all of the following:
(a) General Purpose Financial Statements prepared in accordance
with Section 12460 and "Generally Accepted Accounting Principles."
(b) Tabular statements showing:
(1) The amount of each appropriation for the preceding fiscal
year, the amounts expended, and the balance, if any.
(2) The revenues and cost of government of the state for the
preceding fiscal year , classified in the manner and detail
that the Controller may determine in a manner
consistent with Sections 12460 and 13344 .
(3) The receipts, disbursements, and closing balances of each fund
in the State Treasury for the preceding fiscal year in a manner
consistent with Sections 12460 and 13344 .
(4) Variances between budgetary-legal statements prepared pursuant
to Section 12460 and any statements prepared under "Generally
Accepted Accounting Principles."
The
(c) The Controller may also
publish a condensed summary of the annual report.
The
(d) The reports required by this
article shall be published in an electronic format or printed, as
determined by the Controller. The Controller shall make printed
copies of the reports available upon request , to the extent
feasible, and may charge a reasonable fee for printed copies of the
reports, including the shipping or mailing thereof, not to exceed the
costs of providing those copies .
(e) The Controller shall post on the Internet Web site of the
Controller copies of the state's annual financial reports and any
annual financial report supplements that are prepared, to the extent
feasible. The Controller may deem the reporting requirements of this
section satisfied each year upon completion of the budgetary-legal
basis annual report and comprehensive annual financial report
described in Section 12460.
SEC. 4. Section 13344 is added to the
Government Code , to read:
13344. (a) State agencies shall prepare and maintain financial
and accounting data for inclusion in the Governor's Budget, Budget
Act and related documents, and the budgetary-legal basis annual
report described in Section 12460, according to the methods and bases
provided in regulations, budget letters, and other directives of the
Department of Finance. The adoption, amendment, or repeal of these
regulations, budget letters, or other directives consistent with this
section are exempted from the rulemaking provisions of the
Administrative Procedure Act (Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2. The Department of Finance
shall consult with the Controller concerning significant changes to
these financial and accounting methods, unless those changes are
otherwise specified in law. The Department of Finance shall implement
procedures, consistent with this section, that facilitate annual
reconciliations of General Fund and special fund balances between
those provided by a state agency to the Department of Finance and to
the Controller. In the Governor's Budget documents, appendices
thereof, or other directives, the Department of Finance shall ensure
that adjustments of prior-year fund balances and accounting methods
are clearly noted in some fashion in order to ensure the closest
possible comparability of these documents with past and future
budgetary-legal basis annual reports.
(b) For purposes of this section, "state agency" means every state
office, officer, department, division, bureau, board, and
commission.
SEC. 5. The sum of one thousand dollars ($1,000)
is hereby appropriated from the General Fund to the Department of
Finance for purposes of implementing this bill.
SEC. 6. This act is a bill providing for
appropriations related to the Budget Bill within the meaning of
subdivision (e) of Section 12 of Article IV of the California
Constitution, has been identified as related to the budget in the
Budget Bill, and shall take effect immediately.
SECTION 1. It is the intent of the Legislature
to enact statutory changes relating to the Budget Act of 2012.