STAND. COM. REP. NO. 2617

Honolulu, Hawaii

RE:    S.B. No. 2115

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fifth State Legislature

Regular Session of 2010

State of Hawaii

Madam:

     Your Committee on Ways and Means, to which was referred S.B. No. 2115 entitled:

"A BILL FOR AN ACT RELATING TO PREAUDITS FOR PROPOSED PAYMENTS,"

begs leave to report as follows:

     The purpose of this measure is to clarify preaudit procedures for the University of Hawaii and the Department of Education.

     Specifically, this measure:

     (1)  Requires the Department of Education to preaudit all proposed payments of $10,000 or more;

     (2)  Requires the University of Hawaii and the Department of Education to preaudit sample populations of proposed payments of less than $10,000; and

     (3)  Extends the date that allows the University of Hawaii and the Department of Education to have autonomous authority over their accounting systems and other purchasing responsibilities and duties.

     Your Committee finds that this measure grants the University of Hawaii and the Department of Education more time to exercise complete supervision of all their respective accounts before that supervision returns to the Comptroller.  Furthermore, this measure allows the Department of Education to preaudit only sample populations, and not all proposed payments, of less than $10,000, while still requiring the Department to preaudit all proposed payments of $10,000 or more.

     Your Committee has amended this measure by:

(1)  Establishing an unspecified percentage of the population as the minimum required sample size for the preaudits of sample populations of proposed payments of less than $10,000;

(2)  Changing the effective date to facilitate further discussion on the measure; and

(3)  Making technical nonsubstantive amendments for the purposes of clarity and style.

     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 S.B. No. 2115, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2115, S.D. 1.

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

____________________________

DONNA MERCADO KIM, Chair