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Rule 3-415

Rule3-415. Auditing.

Intent:

To establish an internal fiscal audit program for thejudiciary within the administrative office.

To examine and evaluate court operations by measuring andevaluating the effectiveness and proper application of programs.

Applicability:

This rule shall apply to all courts and the administrativeoffice.

Statement of the Rule:

(1) Schedule of audits.

(A) Periodic. Not less than annually, the audit manager shallprepare a plan of scheduled fiscal and program audits for submission to andapproval by the Council Management Committee. The Board of Justice Court Judgesshall provide the audit manager a recommendation of the courts not of record tobe included in the annual audit schedule submitted to the Council ManagementCommittee.

(B) Amendment to schedule. Any modification or change to theapproved plan of scheduled audits shall require prior approval by the CouncilManagement Committee.

(C) Special audits. Requests for special audits not includedin the plan shall be submitted in writing to the Council Management Committeeand identify the circumstances and need for a special unscheduled audit.

(D) Limited audits. In the event of a reported theft,burglary or other alleged criminal act or suspected loss of monies or propertyat a court location, or if a change occurs in the personnel responsible forfiduciary duties, the state court administrator may authorize a limited audit.

(2) Authority. The audit manager shall be independent of theactivities audited. The audit manager shall have access to all records,documents, personnel and physical properties determined relevant to theperformance of an audit. The audit manager shall have the full cooperation andassistance of court personnel in the performance of an audit. The audit managershall follow generally accepted accounting and performance audit principles forconducting internal audits.

(3) Fiscal audits. Fiscal audits may consist of one or moreof the following objectives:

(A) to verify the accuracy and reliability of financialrecords;

(B) to assess compliance with management policies, plans,procedures, and regulations;

(C) to assess compliance with applicable laws and rules;

(D) to evaluate the efficient and effective use of judicialresources;

(E) to verify the appropriate protection of judicial assets.

(4) Short audits. When a short audit is required or approved,the audit will be conducted without prior notice. The audit shall consist of aone time reconciliation of current cash and receipts and an observation offiscal management procedures unless otherwise directed by the State CourtAdministrator or Management Committee. A written report shall be prepared andexit conference conducted.

(5) Full audits. When a full audit is required or approved,the audit shall be conducted with prior notice. An entrance conference shall beconducted between:

Courts of record: the auditors, court executive, presidingjudge, clerk of court and state level administrator.

Courts not of record: the auditors, justice court judge, alocal government representative, and state level administrator.

The audit shall be conducted at the convenience of the court.

(6) Performance audits. During the course of conducting ashort or full fiscal audit, the audit manager shall observe and reviewcompliance with programs and procedures established by state law and this Codeand make written findings and recommendations to be incorporated in the finalreport. The performance audit shall include an evaluation of the adequacy,effectiveness and efficiency of court operations and management. Objectivityshall be employed by the auditors at all times. Proper recognition shall begiven to commendable court operations when appropriate.

(7) Audit reports.

(A) The audit manager shall prepare a written reportcontaining findings and recommendations as a result of the audit. A draft copyof the report shall be provided in advance and presented to:

Court of record: the court executive, presiding judge andstate level administrator at the exit conference. An opportunity for writtenresponse or comment will be afforded the court executive and presiding judgewhich will be incorporated into and become part of the final report.

Court not of record: the justice court judge and state leveladministrator at the exit conference. An opportunity for written response orcomment will be afforded the justice court judge which will be incorporated intoand become part of the final report.

(B) Copies of the final report shall be provided to:

Courts of record: the Council Management Committee,appropriate Board of Judges, state court administrator, presiding judge, courtexecutive and state level administrator.

Courts not of record: the Council Management Committee, statecourt administrator, justice court judge, a local government representative,state level administrator and the Board of Justice Court Judges.

(8) Follow-up review.

Courts of record: Within 12 months of a short or full audit,the audit manager shall provide a Follow-up Review form, including onlynon-compliance audit findings, to the court executive and copy the court leveladministrator. The court executive will complete the Follow-up Review formreporting on progress made toward compliance and return the form within 30 daysto the audit manager and copy the court level administrator.

Courts not of record: Within 12 months of a short or fullaudit, the audit manager shall provide a Follow-up Review form, including onlynon-compliance audit findings, to the justice court judge and a copy to thestate level administrator. The justice court judge will complete the Follow-upReview form reporting on progress made toward compliance and return a copy ofthe completed form within 30 days to the audit manager, the state leveladministrator, and the Board of Justice Court Judges.