STAND. COM. REP. NO. 3233

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  H.B. No. 2588
                                        H.D. 1
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred H.B.
No. 2588, H.D. 1, S.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO AUDIT AND ACCOUNTING,"

begs leave to report as follows:

     The purpose of this bill is to authorize the Comptroller to
delegate preaudit responsibility for proposed payment amounts
below an unspecified dollar threshold to the state agencies.

     Furthermore, this bill imposes a one-time penalty of five
per cent against state and county agencies for failure to pay a
vendor within thirty days of receipt of the vendor's statement.

     Your Committee finds that a dual approach is necessary to
expedite the review and audit process for government procurement
contracts.  Your Committee understands that the five per cent
penalty could render considerable impact upon state finances.  To
this end, your Committee has asked the state administration to
review the quantitative impact of the penalty and report to your
Committee as soon as possible.

     As affirmed by the record of votes of the members of your
Committee on Ways and Means that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
2588, H.D. 1, S.D. 1, and recommends that it pass Third Reading.

 
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                                   STAND. COM. REP. NO. 3233
                                   Page 2


                                 Respectfully submitted on behalf
                                 of the members of the Committee
                                 on Ways and Means,



                                 ________________________________
                                 CAROL FUKUNAGA, Co-Chair



                                 ________________________________
                                 ANDREW LEVIN, Co-Chair

 
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