State and Local Governments
IC 5-11-1-9 gives the SBOA the responsibility for examining all accounts and all financial affairs of every public office and officer, state office, state institution, and entity receiving public money. The State Examiner in accordance with IC 5-11-1-7 may authorize or designate an Independent Public Accountant (IPA) to perform these examination. If the SBOA engages or authorizes the engagement of a private examiner to perform an examination, the examination and report must comply with the requirements established by our agency as set out in uniform compliance guidelines applicable to the unit type being examined.
Our department continues to perform the examination of the majority of units of government that we are statutorily tasked to perform. However, certain unit types are primarily performed by private examiners. These include: county and city hospitals, housing authorities, charter schools, and non-governmental entities receiving governmental assistance. We retain oversight responsibility for audits performed by private examiners and, therefore, are involved in all stages of the process including the approval of auditor selected, review and approval of the engagement letter, review of draft audit reports, and a quality control review of the final audit report. Once the quality control review has been completed, the report is filed on our website as a public record.
Indiana Code 5-11-1-27(e) provides that through the compliance guidelines authorized under IC 5-11-1-24 the state board of accounts shall define the acceptable minimum level of internal control standards for internal control systems of political subdivisions, including the following: (1) Control Environment. (2) Risk Assessment. (3) Control Activities. (4) Information and Communication. (5) Monitoring.
In response, the SBOA developed the Uniform Internal Control Standards for Indiana Political Subdivisions manual, which contains the acceptable minimum level of internal control standards.
Generally Accepted Government Auditing Standards (the "Yellow Book") prohibits the SBOA from prescribing the actual internal control procedures to be used by a political subdivision. However, the manual provides examples and case studies to demonstrate implementation strategies.
Internal Control Policy and Required Certifications
After June 30, 2016 IC 5-11-1-27(g) provides that the legislative body of each political subdivision must adopt the minimum internal control standards as defined by SBOA. Additionally, the legislative body must ensure that personnel receive training concerning the internal control standards and procedures adopted by the political subdivision.
At the time of submission of the Annual Financial Report (AFR) through Gateway, the fiscal officer must certify that the minimum internal control standards have been adopted and that personnel who are not otherwise on leave status have received training regarding these standards and procedures. Instructions for filing will be found as part of the AFR submission.
Apart from the required certification to be filed by the fiscal officer in Gateway during the submission of the 2016 AFR due March 1, 2017(or August 29, 2017 for Schools)], a certification for each elected official, appointee, and employee that meets the definition of personnel in IC 5-11-1-27(c), should be signed as evidence for their individual training. A certification form is provided below and can also be found under the Appendix found in the Uniform Internal Control Standards for Indiana Political Subdivisions manual. These certifications are to be maintained by the political subdivision on-site.
Indiana Code 5-11-1-27(f) provides that the SBOA develop or designate approved personnel training materials concerning internal controls.
The SBOA has developed and is providing the following training materials on internal controls:
- Uniform Internal Control Standards for Indiana Political Subdivisions manual by the SBOA
- Live presentations by the SBOA at the annual called meetings and conferences around the state.
- The following Webinar:
The webinar can also be downloaded to your local computer by clicking here.
The SBOA has designated the following training materials on internal controls:
- Internal Control - Integrated Framework (2013) by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
- Guidance papers, principals, or frameworks on Governance and Operational Performance, Internal Controls, Enterprise Risk Management, or Fraud Deterrence by COSO.
- Standards for Internal Control in the Federal Government (the "Green Book") set forth by the Comptroller General of the United States.
In addition, the SBOA recognizes that political subdivisions may find appropriate internal control training materials on their own initiative. So, the following training materials may be designated:
- Materials identified and submitted by political subdivisions, which are approved by the SBOA and/or posted on the SBOA's website. Please contact Debbie Gibson at (317) 232-2512 for further information.
This is a form that our agency may provide to you at the beginning of (or before) an engagement. This form allows us to gain a better understanding of your internal control structure and helps us in the planning of our engagement. There are section on this form that may not be applicable to your unit.
Guidelines for Audits of Hospitals and State and Local Governments by Independent Public Accounting Firms
Internal Control Manual
Information Technology Manual
Uniform Compliance Guidelines Manual
You can view the manual online by clicking on one of the Chapters below:
- Table of Contents (2017)
- Chapter 1 - Prescribed Forms, Taxes, General Information, Local Policies, and Deposits and Investments (2017)
- Chapter 2 - Conservancy Districts (2014)
- Chapter 3 - Regional Water, Sewage and Solid Waste Districts (2014)
- Chapter 4 - Solid Waste Management Districts (2014)
- Chapter 5 - Fire Protection Districts (2014)
- Chapter 6 - Airport Authorities (2014)
- Chapter 7 - Public Transportation Corporations (2014)
- Chapter 8 - Regional Planning Commissions (2014)
- Chapter 9 - Soil and Water Conservation Districts (2014)
- Chapter 10 - Other Special Districts (2014)
- Chapter 11 - Miscellaneous Guidelines (2014)
- Chapter 12 - Forms (2014)
- Chapter 13 - Illustrated Forms (2014)
- Chapter 14 - Uniform System of Accounts for Water and Wastewater (2014)