Oregon Secretary of State Corporations Division

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					                SECRETARY OF STATE, AUDITS DIVISION



                                      DIVISION 40

      MINIMUM STANDARDS FOR REVIEW OF OREGON MUNICIPAL
                      CORPORATIONS

162-040-xxxx

Preface

(1) Pursuant to the provisions of ORS 297.465, there is presented herewith the Minimum
Standards for Review of Oregon Municipal Corporations.

(2) These Standards have been approved by the Oregon Board of Accountancy (the
Board), and have been adopted by the Secretary of State as Administrative Rules under
the provisions of ORS Chapter 183.

(3) All reviews of municipal corporations shall be made in accordance with these
Standards, and all review reports shall be in the form prescribed herein. The Standards
are effective for reviews of fiscal years ending after March 31, 2010.

Stat. Auth.: ORS 297
Stats. Implemented: ORS 297.465


162-040-0000

Definitions

(1) "Accountant" as used in these rules means a person licensed by the Oregon Board of
Accountancy to conduct municipal audits and reviews.

(2) "Analytical Procedures" are substantive tests of financial information made by a study
and comparison of relationships among data.

(3) "Determine" as used in these rules means to come to a decision after making inquiries
and observations and performing analytical procedures.

(4) "Review": A review of Financial Statements" is accomplished by making inquiries,
observations and performing analytical procedures to provide the accountant with a
reasonable basis for expressing limited assurance that there are no material modifications
that should be made to the financial statements in order for them to be in conformity with
generally accepted accounting principles (GAAP) or, if applicable, another
comprehensive basis of accounting such as the cash basis. A review doe s not include
obtaining independent corroborative evidence unless specifically required by these rules.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0000; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0005

Introduction

(1) All municipal corporations, as defined in ORS 297.405, are required to have their
accounts and fiscal affairs audited annually, unless they are exempt from audit under
ORS 297.435. These administrative rules apply to review reports prepared under ORS
297.435(3).

(2) The objective of a review differs significantly from the objective of an audit of
financial statements in accordance with generally accepted auditing standards. The
objective of an audit is to provide a reasonable basis for expressing opinions on the
financial statements that collectively comprise the municipality's basic financial
statements. A review does not provide a basis for the expression of such opinions because
a review does not contemplate obtaining an understanding of internal control or assessing
control risk; tests of accounting records and of responses to inquiries by obtaining
corroborating evidential matter through inspection; observation or confirmation; and
certain other procedures ordinarily performed during an audit. A review may bring to the
accountant's attention significant matters affecting the financial statements, but it does
not provide assurance that the accountant will become aware of all significant matters
that would be disclosed in an audit.

(3) The accountant who performs a review of the financial statements of a municipal
corporation must:

(a) Be licensed by the Oregon Board of Accountancy to conduct municipal audits;

(b) Personally perform the review in accordance with these rules to an extent satisfactory
to the Secretary of State; and

(c) Prepare a report expressing limited assurance on the financial statements in
accordance with these rules.

(4) Since the functions and forms of government, as well as the accounting, internal
control, and management information systems, will vary greatly among municipal
corporations; the independent accountant must be or become familiar with legal
provisions applicable to a particular government. The accountant must also be familiar
with the accounting principles considered to be generally acceptable for governments.

(5) Officials of the municipal corporation must account for all resources for which they
are responsible. An appropriate accounting by officials of the municipal corporation will
include financial statements, notes to the financial statements, and the supplementary
schedules required by these rules.

(6) Based upon the review, the accountant is expected to determine if the municipal
corporation's accounts and records are maintained in a manner that will permit the
preparation of financial statements which fairly present its financial position and results
of operations in accordance with legal provisions, and in accordance with generally
accepted accounting principles or another comprehensive basis of accounting. The
accounting principles contemplated are those contained in pronouncements of
authoritative bodies including, but not necessarily limited to, the Financial Accounting
Standards Board, the American Institute of Certified Public Accountants, and the
Governmental Accounting Standards Board. If the municipal corporation fails to prepare
and present the financial statements specified in these rules, the accountant must make a
reasonable attempt to draft them for the municipal corporation using its accounts and
records. If the financial statements cannot be drafted with reasonable effort, the
accountant must include appropriate comments in the review report, together with
recommendations for improvements needed to permit their preparation in the future.
Whenever legal provisions conflict with generally accepted accounting principles or
principles applicable to another comprehensive basis of accounting, the accountant shall
disclose these conflicts and modify the review report if necessary.

(7) The accountant shall also review the municipal corporation's fiscal affairs. This
review shall include determining if operations have been carried out in accordance with
appropriate legal provisions including federal and state laws, charter provisions, court
orders, ordinances, resolutions, and rules and regulations issued by other governmental
agencies and other matters pertinent to the municipal corporation's fiscal affairs. The
independent accountant must disclose in the report material instances of noncompliance
with such legal provisions that come to his or her attention during the review.

(8) The review report shall include financial statements with appropriate notes, an
independent accountant's review report containing limited assurance on the financial
statements, or an assertion that limited assurance cannot be expressed, and the
independent accountant's comments relating to the review of fiscal affairs and
compliance with legal requirements. The accountant's review report should state that the
review was performed in accordance with Statements on Standards for Accounting and
Review Services issued by the American Institute of Certified Public Accountants and
include the reporting elements prescribed by those standards.

(9) The municipal corporation must file a copy of its review report with the Secretary of
State. The report and supporting documentation are subject to review by the Secretar y of
State for compliance with these rules. The Secretary of State may require the accountant
to submit documentation covering the review engagement for purposes of this
requirement.

(10) The accountant shall submit a summary of the revenues and expenditures of the
municipal corporation within 30 days after delivering the review report. The summary
shall encompass the period covered by the review and shall be prepared in a manner and
on forms prescribed by the Secretary of State. One copy of the summary shall be
delivered to the municipal corporation. A supply of the forms will be furnished to the
accountant upon request.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0005; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0010

General Require ments

(1) Reviews shall be performed in accordance with a written agreement executed by the
independent accountant and the municipal corporation. The agreement should clearly
establish the nature of the services to be performed in making the review and shall clearly
set forth the scope of work to be conducted by the accountant. The agreement must
include a provision for the expression of limited assurance on the financial statements of
the municipal corporation and for a determination of compliance with appropriate legal
provisions. The agreement must also provide for the accountant to make a reasonable
attempt to draft financial statement for the municipal corporation if the municipal
corporation does not prepare them as required by these rules. An illustrative standard
contract follows:

                        STANDARD FORM OF AGREEMENT

This contract, made this _______ day of _______________, 20___, in accordance with
OAR162-40-010(1) of the Minimum Standards for Reviews of Oregon Municipal
Corporations between (Independent Accountant), Certified Public Accountant(s) of
_______________, Oregon, and the (Client), Oregon, provides as follo ws:

It is agreed the (Independent Accountant), shall conduct a review of the accounts,
financial statements, and fiscal affairs of (Client), Oregon for the period beginning
__________, and ending __________, (and annually thereafter) in accordance with the
Minimum Standards for Reviews of Oregon Municipal Corporations. The review shall be
undertaken in order to express limited assurance upon the basic financial statements of
(Client), Oregon, and that (Client) has substantially complied with appropriate le gal
provisions.
A review consists principally of inquiries, observations and analytical procedures applied
to financial data. It is substantially less in scope than an examination in accordance with
generally accepted auditing standards, the objective of which is the expression of
opinions regarding the basic financial statements. Accordingly, no such opinions will be
expressed.

A review cannot be relied upon to disclose errors, irregularities, or illegal acts, including
fraud or defalcations that may exist. However, will inform you of any such matters that
come to our attention.

(Independent Accountant) agrees that the services required under this agreement will be
performed by or under personal supervision and that the work will be faithfully
performed with care and diligence.

It is understood and agreed that, should unusual conditions arise or be encountered during
the course of the review whereby the services of (Independent Accountant) are necessary
beyond the extent of the work contemplated, written notification of such unusual
condition shall be delivered to the (Client), Oregon, who shall instruct in writing
(Independent Accountant) concerning such additional services, and that a signed copy of
each such notification and instruction shall be delivered immediately to the Secretary of
State by the issuing party.

The review shall be started as soon after this agreement is executed as is agreeable to the
parties hereto and shall be completed and a written report thereon delivered within a
reasonable time, but not later than 180 days, after the close of the period covered by this
agreement. Adequate copies of such report shall be delivered to the (Client), Oregon and
its form and content shall be in accordance with and not less than that required by the
Minimum Standards for Reviews of Oregon Municipal Corporations.

It is understood and agreed that the (Client), Oregon, is responsible for such financial
statements as may be necessary to fully disclose and fairly present the results of
operations for the period under review and the financial condition at the end of that
period. Should such financial statements not be prepared and presented within a
reasonable period of time, it is understood that (Independent Accountant) shall draft them
for (Client), Oregon. The cost of preparing such financial statements shall be the fee for
conducting the review set forth in Paragraph 9 below. It is understood and agreed that
either party may cancel this agreement by giving notice in writing to the other party at
least (ninety days) prior to the end of any review period.

In consideration of the faithful performance of the conditions, covenants, and
undertakings herein set forth, the (Client), Oregon, hereby agrees to pay (Independent
Accountant) the sum of ______(a reasonable fee) and the (Client), Oregon, hereby
affirms that proper provision for the payment of such fee has been or will be duly made
and that funds for the payment thereof are or will be made legally available.

_____________________
(Independent Accountant)

by____________________________

_____________________

(Client)

by____________________________

(2) The accountant shall conduct reviews in accordance with the general standards for
reviews set forth in OAR 162-040-0015.

(3) The scope of the review of a municipal corporation shall include all funds, accounts
and fiscal affairs including programs wholly or partially funded by other governmental
agencies. If agreements with other governmental agencies require an audit, instead of a
review, the municipal corporation should give full consideration to those requirements.

(4) If prior period financial statements are presented for comparative purposes, the
accountant must clearly establish the degree of responsibility, if any, the accountant is
assuming for such prior period statements.

[ED. NOTE: Appendix referenced is available from the agency.]

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0010; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0015

General Standards for Reviews

(1) A review must be performed by a person or persons having adequate technical
training and proficiency as an independent accountant.

(2) In all matters relating to the engagement, an independence in mental attitude is to be
maintained.

(3) Due professional care shall be exercised in the performance of the review and
preparation of the report.

(4) The work is to be adequately planned and assistants, if any, are to be properly
supervised.
(5) Sufficient relevant data shall be obtained through inquiry, inspection, observation and
analysis to afford a reasonable basis for conclusions or recommendations in relation to a
review engagement. Such data, or summaries thereof, must be contained in
documentation supporting the review.

(6) The review report shall state whether the accountant is aware of any modifications
necessary for the financial statements to be presented in accordance with generally
accepted accounting principles or another comprehensive basis of accounting.

(7) The review report shall state whether the accountant is aware of any instances in
which generally accepted accounting principles or another comprehensive basis of
accounting have not been consistently observed in the current period in relation to the
preceding period.

(8) Informative disclosures in the financial statements and notes to the financial
statements are to be regarded as reasonably adequate unless otherwise stated in the
review report.

(9) The review report shall either contain an expression of limited assurance regarding
the financial statements, notes to the financial statements and supplementary schedules,
or an assertion to the effect that limited assurance cannot be expressed. When overall
assurance cannot be expressed, the substantive reasons should be stated. In all cases
where an accountant's name is associated with financial statements, the review report
should contain a clear-cut indication of the character of the accountant's review, and the
degree of responsibility taken.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0015; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0020

Financial Statements

(1) In 1984, the Financial Accounting Foundation created the Governmental Accounting
Standards Board. The GASB is recognized as the standard-setting authority of GAAP for
state and local governments. As such, fair presentation of financial position and results of
operations in conformity with GAAP for Oregon municipal corporations are those
financial statements consistent with GASB Statements and Interpretations and the
hierarchy of GAAP applicable to state and local governments established by the AICPA
and adopted in GASB Statement Number 55 –The Hierarchy of Generally Accepted
Accounting Principles for State and Local Governments
(2) Since the focus of accounting in a governmental unit is the individual fund, the focus
of the review must also be at the level of the individual fund. Therefore, the financial
statements to be reviewed in accordance with these rules, and upon which the accountant
is to express limited assurance, must include the nonmajor combining and individual fund
financial statements and schedules, whether presented as RSI or OSI.

(3) Each page of the financial statements should include a reference such as "See
Accountant's Review Report." In the event information necessary to prepare these basic
financial statements, or any of them individually, is not readily available, or is not
maintained by the municipal corporation, then appropriate disclosure must be made in the
accountant's review report.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0020; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0050

Notes to Financial State ments

Fair presentation of financial position and results of operatio ns in conformity with
generally accepted accounting principles requires financial statements to be accompanied
by appropriate notes. Appropriate notes shall also accompany financial statements
prepared in accordance with any other comprehensive basis of accounting, such as cash
basis financial statements. Notes to financial statements provide additional factual detail
beyond that which may be feasibly incorporated in the statements proper; they provide
interpretive comment; they provide facts which by conve ntion are excluded from
financial statements; or, they explain the degree of uncertainty attaching to items
presented on the financial statements.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0050; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96

162-040-0054

Required Supple mentary Financial Information (RSI)

In addition to financial statements, the Governmental Accounting Standards Board has
determined that certain statements, schedules, statistical data, or other information are
necessary to supplement, although not required to be a part of, the basic financial
statements.
Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0055

Other Supplementary Financial Information (OSI)

In addition to financial statements, notes and required supplementary information thereto,
other supplementary financial information is considered necessary for full disclosure of
the fiscal affairs of Oregon municipal corporations. Whenever appropriate, reports must
contain the supplementary financial information set forth in OAR 165-040-0060 through
165-040-0085 or reasonable combinations thereof. In the event information necessary to
prepare these schedules, or any of them individually, is not readily available or is not
maintained by the municipal corporation, then appropriate disclosure must be made in the
accountant's review report. If appropriate, the municipal corporation may include these
schedules in the notes to the financial statements.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0055; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0060

Schedule of Revenues, Expenditures, and Changes in Fund Balances/Net Assets,
Budget and Actual (Each Fund)

The municipal corporation must prepare an individual schedule of revenues,
expenditures/expenses, and changes in fund balances/net assets, budget and actual, for
each fund for which budgets are legally required. They must compare estimated with
actual revenues or receipts, transfers in, expenditures or disbursements, transfers out and
ending balances on the basis of the legally adopted budget. If the municipal corporation
has made appropriations in a manner which differs materially from the presentation of
estimated expenditures in the budget document, a separate schedule must be included
which compares actual expenditures/expenses with the legally adopted appropriations.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0060; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0065

Schedule of Property Tax Transactions or Acreage Assessments
A schedule of property tax transactions or acreage assessments is required which presents
the current year and each of the previous five years, separa tely, and all prior years in the
aggregate. The schedule should include beginning of year balances, current year levy,
adjustments, and end of year balances. In addition the schedule may include such
statistical information as may be desirable in order to fully and adequately disclose the
property tax or acreage assessment transactions of the municipal corporation.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0065; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0070

Schedule of Bonded or Long-Term Debt Transactions

At a minimum, OSI shall include a schedule of total outstanding matured and unmatured
principal and matured interest obligations at the beginning of the period, the maturities
and redemptions during the period, and the outstanding matured and unmatured principal
and matured interest at the end of the period.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0070; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0075

Schedule of Future Requirements for Retirement of Bonded or Long-Term Debt

At a minimum, OSI shall include a schedule presenting, by fund and by bond or other
type of issue, in the aggregate and for each of the five succeeding years, and in five- year
increments thereafter, the amount required for the retirement of bonded or other long
term debt, both principal and interest.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0075; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0085

Other Financial or Statistical Information
The report may include such other financial or statistical information as desired by the
municipal corporation, including financial statements or schedules relating specifically to
programs funded wholly or partially by other governmental agencies.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0085; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0090

Required Disclosures and Independent Auditor's Comme nts

Each report shall contain appropriate comments and disclosures relating to the
accountant's review of fiscal affairs for compliance with legal requirements. At a
minimum the accountant's comments and disclosures must include the subject set forth in
OAR 162-040-0095 through 162-040-0150, if they have not been appropriately disclosed
in notes to the financial statements.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0090; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0095

Officers and Registered Agent of the Municipal Corporation

Immediately inside the front cover, the reports shall contain the names and mailing
addresses of officers of the municipal corporation and members of its governing body. In
addition, reports of special districts, as defined by law (ORS chapter 198), shall contain
the name of the district's registered agent and its registered address. If a special district
has not designated a registered agent or registered address, then the report shall so
indicate.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0095; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0110

Accounting and Internal Control
A review in accordance with these rules does not contemplate a review of internal
control. However, when performing inquiries, observations, and analytical procedures,
the accountant should be ever conscious of the condition of the accounting records and
the adequacy of internal control. The accountant should comment on any significant
deficiencies noted, taking into account the size and complexity of the municipal
corporation's financial activities. If recommendations have been made by management
letter, reference to it should be made.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0110; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0115

Public Fund Deposits

The accountant shall state if he or she is aware of any failure to comply with ORS chapter
295, Depositories of Public Funds and Securities. Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0115; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0120

Indebtedness

The accountant shall state if he or she is aware of any failure to comply with legal
requirements relating to debt. This includes both short-term and long-term debt,
limitations on the amount of debt which may be incurred, liquidation of debt within the
prescribed period of time, and adherence to provisions of bond indentures or other
agreements, including any restrictions pertaining to the use of moneys available to retire
indebtedness.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0120; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0125

Budget

The accountant shall state if he or she is aware of any failure to comply with legal
requirements relating to the preparation, adoption, and execution of the annual or biennial
budget for the year under review, and preparation and adoption of the budget for the next
succeeding year. Also, the auditor shall disclose the financial or organizational level at
which the governing body makes the annual appropriations. The minimum levels of legal
appropriation are established in ORS 294.435.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0125; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0130

Insurance and Fidelity Bonds

The accountant shall state if he or she is aware of any failure to comply with legal
requirements and government policies relating to insurance and fidelity bond coverage.
The accountant may recommend further review of coverage by qualified individuals, if
appropriate.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0130; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0135

Public Contracts and Purchasing

The accountant shall state if he or she is aware of any failure to comply with Public
Contracting Code, ORS chapters 279A, 279B and 279C pertaining to: The awarding of
public contracts; and the construction of public improvements.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0135; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-xxxx

Public Charte r Schools

The accountant shall state if he or she is aware of any failure by the charter school to
comply with the following requirements:

(a) Insurance and Fidelity Bonds – OAR 162-040-0130
(b) Programs Funded from Outside Sources – OAR 162-040-0140; and

(c) Public Contracts and Purchasing – OAR 162-040-0135

162-040-0140

Programs Funded From Outside Sources

The accountant shall state if he or she is aware of any failure to comply with appropriate
laws, rules and regulations pertaining to programs funded wholly or partially by other
governmental agencies. This would include, but not necessarily be limited to, state and
federal governmental agencies. Material instances of noncomplia nce should be
sufficiently disclosed to enable the municipal corporation and the appropriate
governmental agency to initiate corrective action.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91, Renumbered
from 165-040-0140; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07

162-040-0146

Highway Funds

The accountant shall state whether he or she is aware of any failure to comply with legal
requirements, (as contained in Article IX, section 3a of the Oregon Constitution),
pertaining to the use of revenue from taxes on motor vehicle use and fuel or the statutory
requirements pertaining to the use of road funds (as contained in ORS 294, 368, and 373).

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-
07

162-040-0148

Investments

The accountant shall state whether he or she is aware of any failure to comply with legal
requirements (as contained in ORS Chapter 294), pertaining to the investment of public
funds.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07
162-040-0150

Other Comme nts and Disclosures

The accountant shall include such other comments or disclosures with respect to the
review of fiscal affairs as may be appropriate in the circumstances.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91; Renumbered
from 165-040-0150

162-040-0155

Suggested Review Procedures

The AICPA Statement on Standards for Accounting and Review Services provide
guidance for the accountant's inquiry and analytical procedures ordinarily performed in a
review engagement. Those standards include an appendix of illustrative inquiries.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: SD 6-1981, f. & ef. 9-1-81; DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91; Renumbered
from 165-040-0155; DOA 1-1996, f. 4-10-96, cert. ef. 6-1-96; AUDIT 2-2007, f. 6-7-07,
cert. ef. 6-30-07

162-040-0160

Extensions of Time to Deliver Review Reports

If the required report is not filed with the Secretary of State within 180 da ys following the
end of the fiscal year, the municipal corporation shall file a written request for extension
of time. The request shall state the reasons for the delay and the expected filing date of
the report. The Secretary of State, for good cause shown, may grant the request for a
reasonable period of time.

 (1) The municipal corporation must submit a request for extension of time to deliver a
review report on forms provided by the Secretary of State. The request must contain the
following information:

(a) The name and registered or mailing address of the municipal corporation;

(b) The name, address, and signature of the accountant or firm, if known, conducting the
review;
(c) The accounting period under review;

(d) A statement setting forth the reasons for the delay in delivering the review report;

(e) The signed approval or disapproval of the request by the chair of the governing body,
or managing or executive officer, of the municipal corporation. Reasons for disapproval
must be included;

(2) Three copies of the extension request shall be submitted to the Secretary of State.
After acting upon the request, one copy will be returned to the accountant and one copy
will be furnished to the municipal corporation. If a request is disapproved, the Secretary
of State shall communicate the reasons for disapproval in writing to the accountant and to
the municipal corporation.

Stat. Auth.: ORS 297.465
Stats. Implemented: ORS 297.465
Hist.: DOA 2-1991, f. 3-8-91, cert. ef. 7-1-91; AUDIT 2-2007, f. 6-7-07, cert. ef. 6-30-07


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