CHAPTER 1. STATE BOARD OF ACCOUNTS CREATED
IC 5-11
ARTICLE 11. ACCOUNTING FOR PUBLIC FUNDS
IC 5-11-1
Chapter 1. State Board of Accounts Created
IC 5-11-1-1
Establishment; members; appointment; qualifications; terms;tenure
Sec. 1. There is established a state board of accounts. The boardconsists of the state examiner and two (2) deputy examiners asprovided in this section. The principal officer of the board is the stateexaminer, who shall be appointed by the governor and who shall holdoffice for a term of four (4) years from the date of appointment. Thestate examiner must be a certified public accountant with at leastthree (3) consecutive years of active experience as a field examinerwith the state board of accounts that immediately precedes theappointment as state examiner. The governor shall also appoint two(2) deputy examiners, who must have the same qualifications as thestate examiner, be of different political parties, and be subordinateto the state examiner. The deputy examiners shall be appointed forterms of four (4) years. The state examiner and the deputy examinersare subject to removal by the governor for incompetency or formisconduct of the office, after a hearing upon due notice and uponstated charges in writing. An appeal may be taken by the officerremoved to the circuit or a superior court of Marion County.
(Formerly: Acts 1909, c.55, s.1; Acts 1915, c.72, s.1; Acts 1941,c.110, s.1; Acts 1943, c.236, s.1; Acts 1945, c.176, s.1.) As amendedby Acts 1980, P.L.30, SEC.1; P.L.3-1986, SEC.7; P.L.39-1996,SEC.1; P.L.246-2005, SEC.53.
IC 5-11-1-2
System of accounting and reporting
Sec. 2. The state board of accounts shall formulate, prescribe, andinstall a system of accounting and reporting in conformity with thischapter, which must comply with the following:
(1) Be uniform for every public office and every public accountof the same class and contain written standards that an entitythat is subject to audit must observe.
(2) Exhibit true accounts and detailed statements of fundscollected, received, obligated, and expended for or on accountof the public for any and every purpose whatever, and by allpublic officers, employees, or other individuals.
(3) Show the receipt, use, and disposition of all public propertyand the income, if any, derived from the property.
(4) Show all sources of public income and the amounts due andreceived from each source.
(5) Show all receipts, vouchers, contracts, obligations, and otherdocuments kept, or that may be required to be kept, to prove thevalidity of every transaction.The state board of accounts shall formulate or approve all statementsand reports necessary for the internal administration of the office towhich the statements and reports pertain. The state board of accountsshall approve all reports that are published or that are required to befiled in the office of state examiner. The state board of accounts shallfrom time to time make and enforce changes in the system and formsof accounting and reporting as necessary to conform to law.
(Formerly: Acts 1909, c.55, s.2; Acts 1945, c.176, s.2.) As amendedby Acts 1980, P.L.30, SEC.2; P.L.3-1986, SEC.8; P.L.39-1996,SEC.2; P.L.176-2009, SEC.2.
IC 5-11-1-3
Separate accounts
Sec. 3. Separate accounts shall be kept for every appropriation orfund of the state or any municipality. Separate accounts shall also bekept for each department, undertaking, enterprise, institution, andpublic service industry.
(Formerly: Acts 1909, c.55, s.3.) As amended by Acts 1980, P.L.30,SEC.3.
IC 5-11-1-4
Financial reports
Sec. 4. The state examiner shall require from every municipalityand every state or local governmental unit, entity, or instrumentalityfinancial reports covering the full period of each fiscal year. Thesereports shall be prepared, verified, and filed with the state examinernot later than sixty (60) days after the close of each fiscal year. Thereports must be filed electronically, in a manner prescribed by thestate examiner that is compatible with the technology employed bythe political subdivision.
(Formerly: Acts 1909, c.55, s.4.) As amended by Acts 1980, P.L.30,SEC.4; P.L.3-1986, SEC.9; P.L.44-1991, SEC.1; P.L.50-2000,SEC.2; P.L.189-2005, SEC.1; P.L.176-2009, SEC.3.
IC 5-11-1-5
Repealed
(Repealed by Acts 1980, P.L.30, SEC.19.)
IC 5-11-1-6
Forms of reports
Sec. 6. The state board of accounts shall formulate, prescribe, andapprove the forms for reports required to be made by this chapter.The state examiner shall annually furnish to the officers required tomake reports by this chapter such printed blanks and forms, on whichshall be indicated the information required, together with suitableprinted instructions for filling out the same.
(Formerly: Acts 1909, c.55, s.6.) As amended by Acts 1980, P.L.30,SEC.5.
IC 5-11-1-7
Field examiners; private examiners
Sec. 7. (a) The state examiner shall appoint assistants notexceeding the number required to administer this article. Theassistants are to be known as "field examiners" and are at all timessubject to the order and direction of the state examiner. Fieldexaminers shall inspect and examine accounts of all state agencies,municipalities, and other governmental units, entities, orinstrumentalities.
(b) The state examiner may engage or allow the engagement ofprivate examiners to the extent the state examiner determinesnecessary to satisfy the requirements of this article. These examinersare subject to the direction of the state examiner while performingexaminations under this article.
(c) The state examiner may engage experts to assist the stateboard of accounts in carrying out its responsibilities under thisarticle.
(Formerly: Acts 1909, c.55, s.7.) As amended by Acts 1980, P.L.30,SEC.6; P.L.3-1986, SEC.10.
IC 5-11-1-8
Field examiners; examinations
Sec. 8. Such field examiners shall be appointed from applicantswho shall have successfully passed an open, competitive examinationfor testing their fitness for appointment. Such examinations shall begiven under the direction of the board after due announcement in thepublic press, and shall be practical in their character, and, as far asmay be, shall relate to those matters which will fairly test the relativecapacity and fitness of the persons examined to discharge the dutiesof the office. All appointments of field examiners shall be madesolely upon the ground of fitness and without regard to the politicalaffiliation of the appointee, excepting that no more than one-half(1/2) of the number of field examiners employed at any one (1) timeshall belong to any one (1) political party. The state board ofaccounts is empowered to make and establish, and from time to timealter and amend, by-laws, rules and regulations for the properenforcement of the provisions of this article and other laws placingduties and responsibilities on the state board of accounts.
(Formerly: Acts 1909, c.55, s.8.) As amended by Acts 1980, P.L.30,SEC.7.
IC 5-11-1-9
Financial examinations; required inquiries; inefficienciesencountered; witnesses; records; process
Sec. 9. (a) The state examiner, personally or through the deputyexaminers, field examiners, or private examiners, shall examine allaccounts and all financial affairs of every public office and officer,state office, state institution, and entity.
(b) An examination of an entity deriving:
(1) less than fifty percent (50%); or (2) at least fifty percent (50%) but less than one hundredthousand dollars ($100,000) if the entity is organized as anot-for-profit corporation;
of its disbursements during the period of time subject to anexamination from appropriations, public funds, taxes, and othersources of public expense shall be limited to matters relevant to theuse of the public money received by the entity.
(c) The examination of an entity described in subsection (b) maybe waived or deferred by the state examiner if the state examinerdetermines in writing that all disbursements of public money duringthe period subject to examination were made for the purposes forwhich the money was received. However, the:
(1) Indiana economic development corporation created byIC 5-28-3 and the corporation's funds, accounts, and financialaffairs; and
(2) department of financial institutions established byIC 28-11-1-1 and the department's funds, accounts, andfinancial affairs;
shall be examined biennially by the state board of accounts.
(d) On every examination under this section, inquiry shall bemade as to the following:
(1) The financial condition and resources of each municipality,office, institution, or entity.
(2) Whether the laws of the state and the uniform complianceguidelines of the state board of accounts established undersection 24 of this chapter have been complied with.
(3) The methods and accuracy of the accounts and reports of theperson examined.
The examinations shall be made without notice.
(e) If during an examination of a state office under this chapter theexaminer encounters an inefficiency in the operation of the stateoffice, the examiner may comment on the inefficiency in theexaminer's report.
(f) The state examiner, deputy examiners, any field examiner, orany private examiner, when engaged in making any examination orwhen engaged in any official duty devolved upon them by the stateexaminer, is entitled to do the following:
(1) Enter into any state, county, city, township, or other publicoffice in this state, or any entity, agency, or instrumentality, andexamine any books, papers, documents, or electronically storedinformation for the purpose of making an examination.
(2) Have access, in the presence of the custodian or thecustodian's deputy, to the cash drawers and cash in the custodyof the officer.
(3) During business hours, examine the public accounts in anydepository that has public funds in its custody pursuant to thelaws of this state.
(g) The state examiner, deputy examiner, or any field examiner,when engaged in making any examination authorized by law, mayissue subpoenas for witnesses to appear before the examiner in
person or to produce books, papers, or other records (includingrecords stored in electronic data processing systems) for inspectionand examination. The state examiner, deputy examiner, and any fieldexaminer may administer oaths and examine witnesses under oathorally or by interrogatories concerning the matters underinvestigation and examination. Under the authority of the stateexaminer, the oral examinations may be transcribed with thereasonable expense paid by the examined person in the same manneras the compensation of the field examiner is paid. The subpoenasshall be served by any person authorized to serve civil process fromany court in this state. If a witness duly subpoenaed refuses to attend,refuses to produce information required in the subpoena, or attendsand refuses to be sworn or affirmed, or to testify when called uponto do so, the examiner may apply to the circuit court havingjurisdiction of the witness for the enforcement of attendance andanswers to questions as provided by the law governing the taking ofdepositions.
(Formerly: Acts 1909, c.55, s.9; Acts 1945, c.176, s.3.) As amendedby Acts 1978, P.L.2, SEC.506; Acts 1980, P.L.30, SEC.8;P.L.3-1986, SEC.11; P.L.63-1989, SEC.1; P.L.70-1995, SEC.1;P.L.39-1996, SEC.3; P.L.50-1999, SEC.1; P.L.4-2005, SEC.25;P.L.213-2007, SEC.2; P.L.217-2007, SEC.2.
IC 5-11-1-9.5
Grounds for examination; retaliation for making sworn statementprohibited
Sec. 9.5. (a) The state examiner may not undertake anexamination of a public office, officer, or institution based on theallegation of an individual, organization, or institution that aviolation of the law has occurred unless:
(1) the individual or representative of the organization orinstitution makes the allegation in the form of a sworn statementthat the individual or representative believes the allegation to betrue; or
(2) the state examiner has probable cause to believe that aviolation of the law has occurred.
(b) A public office, officer, or institution may not retaliate againstan employee of the state or a political subdivision for making thesworn statement described in subsection (a).
As added by P.L.51-1985, SEC.1.
IC 5-11-1-9.7
Withdrawal or removal of counties from solid waste managementdistricts
Sec. 9.7. (a) The state examiner, personally or through the deputyexaminers, field examiners, or private examiners, shall examine thedivision under IC 13-21-4-4 of the responsibility for legal obligationsentered into by a joint solid waste management district upon thewithdrawal or removal of a county from the district.
(b) Not later than one hundred twenty (120) days after the
effective date of the withdrawal or removal, the state examiner shallissue a report of the examination under subsection (a) to:
(1) the board of directors of the joint solid waste managementdistrict; and
(2) the executive of the county that withdrew or was removedfrom the joint solid waste management district.
(c) A report under this section may be used as evidence in anaction seeking to enforce the payment of legal obligations enteredinto by a joint solid waste management district.
As added by P.L.74-2002, SEC.1.
IC 5-11-1-10
Failure to file report; interference with examiners; offense
Sec. 10. A public officer who:
(1) fails to make, verify, and file with the state examiner anyreport required by this chapter;
(2) fails to follow the directions of the state examiner inkeeping the accounts of the officer's office;
(3) refuses the state examiner, deputy examiner, field examiner,or private examiner access to the books, accounts, papers,documents, cash drawer, or cash of the officer's office; or
(4) interferes with an examiner in the discharge of theexaminer's official duties;
commits a Class B infraction and forfeits office.
(Formerly: Acts 1909, c.55, s.10.) As amended by Acts 1978, P.L.2,SEC.507; P.L.3-1986, SEC.12.
IC 5-11-1-11
Records of money collected; public inspection
Sec. 11. There shall be kept in the office of each public officer,board, commission, agency, instrumentality, and institution in thisstate, a record of money collected for the public treasury, the formsand records for which, for each class of offices, shall be devised andformulated by the state board of accounts. Such records as areprovided for in this section shall be public records and must beaccessible to the public during regular office hours.
(Formerly: Acts 1909, c.55, s.11.) As amended by Acts 1980, P.L.30,SEC.9.
IC 5-11-1-12
Repealed
(Repealed by Acts 1980, P.L.30, SEC.19.)
IC 5-11-1-13
Warrants or checks of state or municipality; receipts or quietus;correctness of claims
Sec. 13. Each officer having authority to draw the warrant orcheck of the state or of any municipality referred to in this chapter indisbursing its funds, or who has authority to execute the receipt orquietus of the state or of such municipality in settlement with public
officers or with debtors, before presenting the same for allowance tothe board or other authority required to pass upon the same, shallmake an examination of all claims as to their form, the authenticationthereof as required by law, whether they are based upon contract orstatutory authority, and as to their apparent correctness, and uponpresenting the same to file therewith his certificate in writing as tosuch matters in respect to each and all of such claims. Where theauthority to pass upon and allow such claim is lodged in such officer,he shall, before drawing a warrant or check therefor, certify to thecorrectness thereof over his official signature. Before issuing thereceipt or quietus of the state or municipality to any debtor or anyofficer making settlement, he shall examine the report, account orsettlement sheet upon which settlement is made, and require of suchdebtor or officer, or to otherwise secure, all such information,accounts, vouchers or exhibits as shall be necessary to satisfy suchofficer issuing such receipt or quietus of the correctness of suchreport, account or settlement sheet, and to certify thereon that he hasmade such examination and is satisfied as to its correctness, and nosuch warrant, check, receipt, or quietus shall be issued by any suchofficer until such certificate shall have been executed and filed withsuch claim, report, account or settlement sheet. Where it is notpractical for the officer to certify to the correctness of each revenueor claim document, the state board of accounts may prescribe othermethods of preaudit to be performed before approval by the officeror his employees.
(Formerly: Acts 1909, c.55, s.13.) As amended by Acts 1980, P.L.30,SEC.10.
IC 5-11-1-14
Salaries and traveling expenses of state examiner, deputies, andassistants
Sec. 14. The salaries and necessary traveling expenses of the stateexaminer, his deputies, and assistants when engaged in the businessof the state shall be paid as otherwise provided by law.
(Formerly: Acts 1909, c.55, s.15.) As amended by Acts 1980, P.L.30,SEC.11.
IC 5-11-1-15
Bonds and crime policies for faithful performance
Sec. 15. (a) The state examiner, deputy examiners, and fieldexaminers shall each give bond for the faithful performance of theexaminer's duties, as follows:
(1) The state examiner in the sum of five thousand dollars($5,000), to be approved by the governor.
(2) Each deputy examiner in the sum of three thousand dollars($3,000), to be approved by the governor.
(3) Each field examiner in the sum of one thousand dollars($1,000), to be approved by the state examiner. However, fieldexaminers may be covered by a blanket bond or crime insurancepolicy endorsed to include faithful performance under
IC 5-4-1-15.1 subject to approval of the state examiner.
(b) The commissioner of insurance shall prescribe the form of thebonds or crime policies required by this section.
(Formerly: Acts 1909, c.55, s.16; Acts 1967, c.268, s.1.) As amendedby P.L.3-1986, SEC.13; P.L.49-1995, SEC.6.
IC 5-11-1-16
Definitions
Sec. 16. (a) As used in this article, "municipality" means anycounty, township, city, town, school corporation, special taxingdistrict, or other political subdivision of Indiana.
(b) As used in this article, "state" means any board, commission,department, division, bureau, committee, agency, governmentalsubdivision, military body, authority, or other instrumentality of thestate, but does not include a municipality.
(c) As used in this article, "public office" means the office of anyand every individual who for or on behalf of the state or anymunicipality or any public hospital holds, receives, disburses, orkeeps the accounts of the receipts and disbursements of any publicfunds.
(d) As used in this article, "public officer" means any individualwho holds, receives, disburses, or is required by law to keep anyaccount of public funds or other funds for which the individual isaccountable by virtue of the individual's public office.
(e) As used in this article, "entity" means any provider of goods,services, or other benefits that is:
(1) maintained in whole or in part at public expense; or
(2) supported in whole or in part by appropriations or publicfunds or by taxation.
The term does not include the state or a municipality (as defined inthis section).
(f) As used in this article, a "public hospital" means either of thefollowing:
(1) An institution licensed under IC 16-21 and which is ownedby the state or an agency of the state or one which is amunicipal corporation. A hospital is a municipal corporation ifits governing board members are appointed by elected officialsof a municipality.
(2) A state institution (as defined in IC 12-7-2-184).
(Formerly: Acts 1909, c.55, s.17.) As amended by Acts 1980, P.L.30,SEC.12; P.L.3-1986, SEC.14; P.L.2-1992, SEC.52; P.L.2-1993,SEC.44.
IC 5-11-1-17
Repealed
(Repealed by Acts 1978, P.L.2, SEC.521.)
IC 5-11-1-18
Examinations without notice; disclosure; offense
Sec. 18. All examinations under this chapter shall be made
without notice to the officers whose accounts are to be examined,and without notice to any clerk, deputy, employee, or other personemployed in or connected with the office or the business of such anofficer. A person who recklessly communicates knowledge of anyproposed examination of any public account to the officer in chargeof the account or to any other unauthorized person commits a ClassB misdemeanor.
(Formerly: Acts 1909, c.55, s.19.) As amended by Acts 1978, P.L.2,SEC.509.
IC 5-11-1-19
Copyrighting uniform bookkeeping system; purchase of publicoffice supplies
Sec. 19. No system for uniform bookkeeping or any book, record,or form which may be adopted after April 5, 1909, shall becopyrighted unless it shall be deemed expedient by the governor thata copyright be procured in the name of the state, and if any suchcopyright be procured, the acceptance by the state or by anymunicipality of any bid for printed supplies of any sort shall operateas a license from the state to the successful bidder to manufactureany such copyrighted books, records, or forms included in such bidfor public use without payment of royalty. All public books, records,and stationery used in the offices for which examination is providedin this chapter shall be purchased by the state, municipality, orinstitution after the manner provided by law.
(Formerly: Acts 1909, c.55, s.20.) As amended by P.L.25-1986,SEC.36.
IC 5-11-1-20
Repealed
(Repealed by Acts 1980, P.L.30, SEC.19.)
IC 5-11-1-21
Mandatory adoption of uniform system; refusal to adopt or failureto use; offense; penalty
Sec. 21. All public officers shall adopt and use the books, forms,records, and systems of accounting and reporting adopted by the stateboard of accounts, when directed so to do by the board, and allforms, books, and records shall be purchased by those officers in themanner provided by law. An officer who refuses to provide suchbooks, forms, or records, fails to use them, or fails to keep theaccounts of his office as directed by the board commits a Class Cinfraction and forfeits his office.
(Formerly: Acts 1909, c.55, s.22.) As amended by Acts 1978, P.L.2,SEC.510.
IC 5-11-1-22
Existing duties; effect of chapter
Sec. 22. The provisions of this chapter shall not be construed torelieve any officer of any duties required by law of him on April 5,
1909, with relation to the auditing of public accounts or thedisbursement of public funds, but the provisions of this chapter shallbe construed to be supplemental to all provisions of law existing onApril 5, 1909, safeguarding the care and disbursement of publicfunds; and provided further, that the provisions of this chapter shallnot be construed to limit or curtail the power of the governor of thestate under laws existing on April 5, 1909, to make examination orinvestigation of any public office or to require reports therefrom.
(Formerly: Acts 1909, c.55, s.23.) As amended by P.L.25-1986,SEC.37.
IC 5-11-1-23
Repealed
(Repealed by P.L.5-1988, SEC.35.)
IC 5-11-1-24
Uniform compliance guidelines for examinations and reports
Sec. 24. (a) The state board of accounts shall establish in writinguniform compliance guidelines for the examinations and reportsrequired by this chapter. The uniform compliance guidelines mustinclude the standards that an entity must observe to avoid a findingthat is critical of the entity for a reason other than the entity's failureto comply with a specific law.
(b) The state board of accounts may not establish guidelines forthe auditing of an entity that are inconsistent with any federal auditguidelines that govern the entity.
(c) The state board of accounts must distribute the uniformcompliance guidelines to each entity that the state board of accountsmay audit.
(d) If the state board of accounts engages or authorizes theengagement of a private examiner to perform an examination underthis chapter, the examination and report must comply with theuniform compliance guidelines established under subsection (a). Ifa person subject to examination under this chapter engages a privateexaminer, the contract with the private examiner must require theexamination and report to comply with the uniform complianceguidelines established under subsection (a).
(e) The state or a municipality may not request proposals forperforming examinations of an entity that is subject to examinationunder this chapter unless the request for proposals has beensubmitted to and approved by the state board of accounts.
(f) The state or a municipality may not enter into a contract withan entity subject to examination under this chapter if the contractdoes not permit the examinations and require the reports prescribedby this chapter.
As added by P.L.3-1986, SEC.15. Amended by P.L.39-1996, SEC.4.
IC 5-11-1-25
Annual examinations; biennial examinations
Sec. 25. (a) Examinations under this chapter shall be conducted
annually for the following:
(1) The state.
(2) Cities.
(3) Counties.
(4) Towns with a population greater than five thousand (5,000).
(5) Public hospitals.
(b) Subject to section 9 of this chapter, examinations under thischapter shall be conducted biennially for:
(1) municipalities; and
(2) entities;
that are not listed in subsection (a).
As added by P.L.3-1986, SEC.16. Amended by P.L.2-1991, SEC.27.
IC 5-11-1-26
Examination reports; requisites; powers of board
Sec. 26. (a) If a state office, municipality, or other entity hasauthority to contract for the construction, reconstruction, alteration,repair, improvement, or maintenance of a public work, the stateboard of accounts shall include in each examination reportconcerning the state office, municipality, or entity:
(1) an opinion concerning whether the state office,municipality, or entity has complied with IC 5-16-8; and
(2) a brief description of each instance in which the state office,municipality, or entity has exercised its authority underIC 5-16-8-2(b) or IC 5-16-8-4.
(b) The state board of accounts may exercise any of its powersunder this chapter concerning public accounts to carry out thissection, including the power to require a uniform system ofaccounting or the use of forms prescribed by the state board ofaccounts.
As added by P.L.63-1987, SEC.1.