HBA-ATS S.B. 770 76(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 770 By: Shapiro State Affairs 4/27/1999 Engrossed BACKGROUND AND PURPOSE Passed by the Texas Legislature in May 1989, the Internal Audit Act requires that certain agencies have an independent internal audit function. In addition, the Act sets forth guidelines for the internal audit and establishes qualifications, responsibilities, and standards for an internal auditor. Maintaining the independence of the internal audit is important to its function. S.B. 770 includes the provision that the external peer review in which the internal auditor is required to participate is in accordance with standards described by Section 2102.011, Government Code. In addition, this bill deletes a state agency's designee from the list of entities required to appoint an internal auditor, and requires the governing body of a state agency or the administrator of a state agency without a governing body to review the agency's staffing and budget of its internal auditing program to determine whether the agency maintains adequate resources to address identified risks in the agency's annual risk assessment. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 2102.006, Government Code, by amending Subsection (a) and adding Subsection (d), as follows: (a) Deletes a state agency's designee from the list of entities required to appoint an internal auditor. (d) Requires the governing body of a state agency or the administrator of a state agency without a governing body to review the agency's staffing and budget of its internal auditing program to determine whether the agency maintains adequate resources to address identified risks in the agency's annual risk assessment. SECTION 2. Amends Section 2102.007(a), Government Code, to include the provision that the external peer review in which the internal auditor is required to participate is in accordance with standards described by Section 2102.011, Government Code (Internal Audit Standards). SECTION 3. Amends Section 2102.008, Government Code, to make a conforming change. SECTION 4. Repealer: Section 2102.009 (Annual Report), Government Code. SECTION 5. Effective date: September 1, 1999. SECTION 6. Emergency clause.