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§300 Three sources
§301 Indiana Code
§302 State Board of Accounts (SBOA) Manuals
§303 State Budget Agency Circulars
§351 Cash book rule (criminal offense)
§352 Depository rule (criminal offense)
§353 Itemization of invoices (criminal offense)
§354 Fiscal spending plan
§355 Payment in arrears
§356 Timely payment of claims
§357 Duplicate and over-payment collection
§358 Claim vouchers less than $25,000
§359 Credit card use
§360 SDO funds
§361 Procurement cards (P cards)
§362 Personal Use
§364 Inactive funds
§365 Attendance reports
§383 Travel, in general
§387 Bonuses and benefits
The financial rules for the Executive Branch of Indiana Government are in three basic sources:
The following sections will address each of the three sources, and then highlight common financial rules.
The Accounting and Uniform Compliance Guidelines Manuals (“Manuals”) are authored and maintained by the Indiana State Board of Accounts (SBOA).
The SBOA is required by the Indiana Legislature to maintain these Manuals to provide financial guidance to Indiana government.
The SBOA Manuals provide financial rules for various Indiana government groups, including state government agencies, universities and cities and towns. We will address only state government rules which are found in the State and Quasi Agency Manual.
The Budget Agency is expressly authorized by the Legislature to adopt policies and procedures consistent with law to facilitate and carry out the powers and duties of the Budget Agency. These policies are not subject to promulgation requirements.
A public officer who receives or distributes public funds and fails to:
commits a violation of the cash book rule, a class B misdemeanor.
The cashbook is also a public record and is open to public inspection in accordance with the Access to Public Records Act (APRA or Open Records Act). Penalties for the violation of the APRA may include a civil action to compel disclosure and the payment of attorney fees and costs.
A (1) public officer or state officer who (2) receives and has control of public funds paid into the treasury of the state or the treasuries of the respective political subdivisions and who (3) later than the business day following the receipt of the public funds fails to deposit the public funds in one or more depositories in the name of the state or political subdivision, commits a violation of the depository rule, a class B felony, and is liable upon the officer’s official bond for any loss or damage that may accrue.
Defense: State officers from the Department of Natural Resources and Department of Revenue are exempted from this rule.
IC 5-13-6-1 (rule);
IC 4-13-2-21 (rule restated);
IC 5-13-14-3 (penalty);
IC 5-13-4-19 (political subdivision defined);
IC 5-13-4-20 (public officer defined);
IC 5-13-4-21 (public funds defined);
IC 5-13-8-1 and IC 5-13-9.5 (designation of depositories)
Taylor v. State, 663 N.E.2d 213 (Ind.Ct.Apps. 1996)(criminal conviction affirmed where community center director appointed by mayor qualified as “public official”); SBOA State and Quasi Manual, Chapter 3
Invoices submitted with vouchers for payment by the state must be itemized.
A criminal offense may also be implicated with a violation of this rule:
commits failure to properly certify an itemized claim, a class D felony.
State agencies shall complete and submit for approval to Budget Agency a Spending Plan for each required fund center to aid in the fiscal management of the agency.
Unless specifically exempted, payment by the State for any services, supplies, materials, or equipment shall not be paid from any fund or state money in advance of receipt of such services, supplies, materials, or equipment.
Public officials and employees have a duty to pay claims timely, and are personally responsible for any penalty, interest or other charge paid by a governmental unit incurred due to untimely payment.
Governmental units are responsible for the immediate collection of any overpayment or duplicate payments made.
SBOA Manuals, Chapter 5
Claim vouchers where payment is for less than $25,000 may be made by the state agencies rather than the Budget Agency.
An agency head or designee may authorize a state employee to be considered for a corporate credit card issued in the employee’s name for travel expenses while in travel status. Excluded from this use are expenses for meals, mileage and gasoline.
A Special Disbursing Officer (SDO) who does any of the following:
commits a violation of the requirements of SDO funds and may be held personally responsible for the amount needed to balance the fund or for amounts improperly expended.
The P-Card system is a credit account established by a commercial financial institution on behalf of the State of Indiana. Goods and services may be purchased with the P-card, but an approved application by the agency is required and various controls must be implemented.
Public funds may not be used for personal items or items unrelated to the government unit.
The public official or employee who makes an unauthorized purchase is personally liable to the state for reimbursement.
Inventories must be maintained for state property items which have an individual value in excess of $25,000.
Funds which remain inactive for two years must be reported to the Office of Budget and Management.
Employees are required to submit a completed attendance report (A-4) at the end of each pay period.
Supervisors are required to review and approve these forms.
SBOA Manuals, Chapter 9
Unlike the corporate or private industry world, business lunches may not be paid for with state money.
However, the State Budget Agency authorizes simple refreshments or light meals at state-sponsored events such as board and commission meetings, conferences, hearings, retreats, seminars, training sessions and workshops. Caution is urged, as approval is “situation and fact sensitive.” Examples of prohibited expenses are included within Budget Agency Circular 2007-2.
Alcohol may not be purchased with state money.
Travel expenses including reimbursements for lodging, subsistence and mileage, are governed by Budget Agency Financial Management Circulars and the SBOA Manuals.
Travel outside the State must be approved by the DOA Travel Office.
In-state lodging reimbursement may not exceed the maximum in-state lodging rate of $79 set by the State Budget Agency. DOA Travel Office approval is not required unless reimbursement above the maximum rate will be requested.
Out-of-state lodging reimbursement must be approved in advance by the DOA Travel Office.
Lodging reimbursement is not permitted when the state worker travels less than 50 miles from the worker’s home or work station.
Budget Agency Circular 2003-1, Section 6-1 (lodging)
Budget Agency Circular 2003-1, Section 10-5 (lodging rates of reimbursement)
Budget Agency Circular 2003-1, Section 7-7 (50-mile restriction)
SBOA State and Quasi Agency Manual, Chapter 11
Subsistence expenses may be reimbursed within specified rates.
Subsistence reimbursement is not permitted when the state worker travels less than 50 miles from the worker’s home or work station.
Mileage reimbursement is also permitted at a specified rate. Currently the rate is $0.44 per mile.
Any compensation, premium, bonus or product earned as a result of the purchase of goods or services by the government unit becomes the property of the government unit.