The California State Auditor is the State's independent and nonpartisan audit, evaluation, and investigative arm of the Legislature and the citizens of California. In addition to conducting high risk assessments as authorized by statute, investigations of misconduct by state employees, and audits as requested and approved by the Joint Legislative Audit Committee or mandated in statute, the State Auditor is responsible for annually conducting California's statewide Single Audit. The Single Audit is a combination of the independent audit of the State's basic financial statements and the independent audit of numerous federal programs administered by California. Since 1984 the Single Audit is required as a condition for California to receive billions in federal funds each year. In Fiscal Year 2007-08, California received more than $75 billion in federal funds.
As the State's external independent auditor, the State Auditor is the only entity that has by statute, full access to all records, accounts, correspondence, property or other files of state and local agencies, special districts, public contractors, and school districts. General powers of the State Auditor include the ability to subpoena records, take depositions, and administer oaths. The State Auditor's Office (office) is responsible for evaluating departments' administration and management of public funds and programs to assure that the proper checks and balances are in place. In addition, the office evaluates departments' compliance with laws and regulations. Although our audits encompass a wide range of topics, our staff are highly trained professionals with a depth and breadth of experience that allows them to evaluate programs and recommend ways to make government more efficient, improve management controls, and instill best practices.
For the past 25 years, the State Auditor's Office and its predecessor has reported on the State's ability to comply with federal program requirements—both by department and by program. The number and type of federal programs audited each year as part of the Single Audit is formula-driven as stipulated by the federal Office of Management and Budget (OMB). In the fiscal year ending June 30, 2007, California received $76 billion in federal funds, and the office audited $59 billion, or 78 percent of those funds.
Given the vast amount of federal funds that California expects to receive under the federal American Recovery and Reinvestment Act of 2009 (Recovery Act), oversight and accountability responsibilities for state auditors including the California State Auditor's Office will increase dramatically. In fact, because of concerns related to internal controls, the large amount of Recovery Act funds California expects to receive, the new requirements the federal government is imposing on recipients, and the limited time the State has to spend some of the funding, we added California's system for administering federal Recovery Act funds to our list of statewide high-risk issue areas.
The links below will provide more information about high-risk issues and the Single Audit. In addition, we have summarized the findings and information from the two most recent Single Audits in a variety of ways to assist you in identifying areas of risk regarding the use of federal Recovery Act funds.