1. School for County Commissioners Courts
The office of
County Auditor
Presented by:
Lisa Smith, Bastrop County Auditor
Katie Conner, Brazos County Auditor
V.G. Young Institute
School for County Commissioners Courts
February 20, 2019
Insert Gain Attention: Use opener here that creates an analogy between the unique characteristics of a county auditor and the Texas Comptroller of Public Accounts.
For example, a system of “checks and balances” exists between the county auditor and the Commissioners Court just like a system of “checks and balances” exists between the State Legislature and Comptroller. The county auditor has independent authority to review financial matters much like the Comptroller. The Commissioners Court adopts the County Budget much like the Legislature, but it is the county auditor that audits the expenditures. Because of this responsibility, the county auditor has one of the more unique roles in the county offices.
State Objectives:
Upon completion of this lesson, you should be able to:
1.Outline the authorities of the county auditor
2.Describe the roles and responsibilities of the county auditor
3.Explain the challenges faced by county auditors
Insert Make It Personal: Ask the participants to discuss the importance of a “checks and balances” system. Have participants relate this system to their own lives. Ask participants if they have served in a more independent role or in more of a “check” role. Continue to use this analogy and relate material to participants throughout lesson.

2. What is a County Auditor?
History and Background
1905 – created by statute
Pop. >= 10,200 – Required
Pop. < 10,200 – Optional
Qualifications
Competent, experienced, moral character
Present Content: Stimulate participants by presenting the information in short segments (10 minutes each). Refer back to personal example provided during introduction when appropriate. Use visual or other aides to demonstrate ideas.
History and Background
Office of County Auditor was statutorily created in 1905 (appointed by CJ & DJs) District Courts given judicial review over Cct Auditor appointed by DJs only. County Auditor required in counties with a population of more than 10,200. County Auditor may be appointed in a county with a population of less than 10,200 through joint action of Commissioners Court and district judge(s). (LGC ) Joint employment allowed in counties < 25,000 if both Commissioners Courts approve subject to the District Judges approval. (LGC )
Independence
Part of the system of checks and balances of county government. Not bound to or by the Commissioners Court or any other elected official. Appointed by District Judge(s); salary set by District Judge(s).

3. What is a County Auditor? Cont’d
Appointment
Appointed by District Judge(s)
Majority vote
Two year term
Oath & Bond requirements
Relationship to District Judge(s)
District Judge(s) have limited authority over County Auditor. District Judge(s) appoint the County Auditor to a two year term. (LGC ) District Judge(s) set the salary of the County Auditor and assistants, within statutory limits. (LGC 111) Assistants approved by District Judge(s) and certified to Commissioners Court including “temporary” provisions. (LGC )
Qualifications, Appointment and Salary
Qualifications (LGC )
1). Competent accountant with at least two years experience in auditing and accounting.
2). Thoroughly competent in public business details.
3). Unquestionably good moral character and intelligence.
Continuing Education: Must complete 40 hours of continuing education accredited by the Texas State Board of Public Accountancy. (LGC )
Appointment (LGC )
Affirmative vote by (majority of) district judge(s) at a special called public meeting. (LGC ) Two year term. (LGC ) Oath and bond required. (LGC ) Can be removed from office for official misconduct or incompetence. (LGC )

4. What is a County Auditor? Cont’d
Independence
Nature of the relationship with District Judges
Ensures a system of checks & balances
Not just the Auditor
Cooperative effort

5. What is a County Auditor? Cont’d
Auditor Salary
Set by District Judges at Hearing
Max. = highest paid elected county official with a few exceptions
Staff
District Judges approve list and salaries
5% increase limitation
Salary
Set annually by district judges in a special called public meeting. (LGC )
May not exceed the salary from all sources of the highest paid elected county officer other than a statutory county court judge. (LGC ) Prior to 80th Legislative session, salary exceptions limited to counties >500,000. Now several different brackets exist with Commissioners Court Approval.
Staff (LGC )
District judge(s) approve the list of assistants and set the annual salaries of the auditor’s staff in a special called public meeting. An overall increase of more than 5% for an assistant’s office expenses or salary requires Commissioners Court approval. (LGC 111)
Auditor is responsible for maintaining and developing adequately trained staff. Auditor may discharge staff.

6. AUTHORITY OF THE COUNTY AUDITOR

7. Statutory Oversight General oversight of books and records
See to strict enforcement of laws – county finances
Access
Continual access to records
Content, cont.
Oversight Authority
Maintains a general set of county financial records (LGC ).
Oversight of the books and records of the County is given to the County Auditor (LGC (a)).
County Auditor shall see to the strict enforcement of the law governing County finances (Local Government Code (b)).
The county auditor shall annually examine the records of each precinct, county and district officer (LGC (a)).
Access Authority
Continual access to and ability to examine and investigate the books, accounts and records of any office receiving County funds is given to the County Auditor (LGC ).
The same access is given concerning the records of specialized governmental entities, such as the District Attorney, Juvenile Probation and Adult Probation (LGC ).
The County Auditor has the authority to examine records in criminal cases with regards to the proper collection of fines and court costs (Code of Criminal Procedure ).

8. Statutory cont’d Prescriptive Verification
Regulations for collecting & accounting
System of accounting (>190,000)
Time, manner, form of reports to Auditor
Verification
Claims approval
Claim incurred as provided by law
Prescriptive Authority
The County Auditor shall prescribe the system of accounting for the County (LGC , and (c)).
The County Auditor has the authority to prescribe the manner and form for other officials to make monthly and annual reports of collections to the County Auditor (LGC ).
The County Auditor may adopt and enforce regulations that the Auditor considers necessary for the speedy and proper collecting, checking and accounting of the and other fees and funds of the County (LGC (b) and (c)).
Change funds established by Cct once approved by auditor.
Verification Authority
The County Auditor shall examine each claim, bill or account against the County and approve each before it may be allowed to be paid (LGC ).
The County Auditor may require an affidavit from a County officer indicating that a claim or bill is correct and valid (LGC ).
In counties under 225,000 in population, the county auditor may assist the county judge in the budgeting process (LGC ).

9. Duties and Responsibilities of the County Auditor

10. Duties and Responsibilities
Auditing
All funds due/collected/disposed
All funds/assets safeguarded
Examine books of all officials/departments
Review internal controls
Accounting and Financial Reporting
Maintain general ledger & chart of accts
Periodic reports – internal/external
Coordinate outside audits
Content, cont.
Auditing
The goals of internal audit are:
to insure the accuracy of accounting and budgeting information.
to safeguard the assets of the county.
to insure the efficiency of county operations.
to insure a compliance with legal requirements regarding the use of resources.
Statutes regarding the audit function:
The County Auditor shall have continual access to the books and records of any county officer and orders of the commissioners court. (LGC )
The County Auditor is to examine all reports about the collection of money for the County (LGC ).
The County Auditor is to examine the books of County officials for correctness (LGC ).
The County Auditor is to examine the County Treasurer’s books and reports (LGC ).
The County Auditor is to examine the accounts of any precinct, county or district official (LGC ).
The County Auditor is authorized to audit the funds of any specialized local entity (such as the criminal district attorney). (LGC (g))
An “outside” independent audit is often required by statute (LGC Chapter 115), bond covenant, grant requirement, etc. An outside auditor is selected by Commissioners Court and generally works closely with the County Auditor.
Key internal controls:
Authorization
Execution
Recording
Safeguarding
Separation of Duties
Supervision
Accounting and Financial Reporting
1.The County Auditor specifies the system of accounting for the County as a whole and for individual fee offices in conformance with generally accepted accounting principles as established by the Governmental Accounting Standards Board (GASB)..
2.The County Auditor specifies the system for the collection and reporting of fines and fees.
3.The County Auditor prescribes the time and manner for financial reports from other elected officials and fee officers. (LGC )
4.Responsibility for the design of the accounting system rests with the County Auditor.
5.The County Auditor must maintain the general ledger of the County throughout the year.
6.Monthly financial reports are prepared by the County Auditor.
7.Preparation of the annual financial report is the responsibility of the County Auditor.
8.The County Auditor often coordinates the annual outside audit.
9.The County Auditor is responsible for the accounting and reporting of grants.
10.Most checks written by the County require a countersignature from the County Auditor.

11. Duties and Responsibilities (cont’d)
Budgeting
Subchapter A – assist with budget
Subchapter B – budget officer
Subchapter C – Commissioners Court appoints budget officer
Purchasing and Approval of Claims
Verify compliance with contracts
Legally acquired and budgeted expenditures
Content, cont.
Budgeting
The County Auditor is the budget officer or assists the County Judge in preparing the budget in most counties.
In counties with populations in excess of 225,000, the County Auditor prepares the budget unless the Commissioners Court has formally appointed a budget officer.
In counties with populations less than 225,000, the County Judge generally prepares the budget with the assistance of the County Auditor.
In counties with populations greater than and less than 225,000, the County Judge prepares the budget unless the Commissioners Court has formally appointed a budget officer.
2.The County Auditor has the authority to estimate revenues from all sources in most large counties. The County Auditor certifies the receipt of new money that was not included in the original budget.
3.The Commissioners Court must approve any increase in the County Auditor’s budget (without regard to the salary of the County Auditor) greater than 5%.
4.The County Auditor must exercise oversight authority to see that only properly budgeted expenditures are approved for payment by the County.
Purchasing and Approval of Claims
1.The County Auditor may not pay for supplies or materials that have not been properly requisitioned and approved (LGC ).
2.The County Auditor must co-sign disbursement checks to validate them as proper and budgeted expenditures. (LGC )
3.Purchase Requisitions (LGC )
The County Auditor may not approve the purchase of supplies or materials unless a requisition signed by the requesting officer and approved by the county judge is presented.
In a county with a county auditor, the Commissioners Court may waive the requirement for approval of purchase requisitions by the County Judge with all claims being approved in open court.

12. Duties and Responsibilities (cont’d)
Accounts Payable
Budgetary compliance
Co-sign checks with Treasurer
Payroll
Routine audits for compliance
Content, cont.
Accounts Payable
These duties are performed by the County Auditor both to process normal accounting functions as well as to meet the County Auditor’s duty for verification of financial transactions.
Processing of accounts payable directly relates to the responsibility of the County Auditor require strict compliance with the county budget and to verify the correctness and legality of claims against the County before payments are disbursed. (LGC and )
Statutory requirements and good internal control through separation of duties necessitates the involvement of the county auditor, commissioners court and county treasurer. (LGC (a), , (a)
The County Auditor must co-sign disbursement checks to validate them as proper and budgeted expenditures. (LGC )
Processing of accounts payable are optional duties by law (Agan v Titus County, AG Opinion DM-440). These are usually processed by the County Auditor to meet the County Auditor’s duty for verification of financial transactions and prescribed high standards of internal control.
Payroll
Commissioners court has the authority to assign the payroll function to a responsible county official.
Benefit Changes.
Other Duties Subject to Assignment by Commissioners Court
Information Technology and Data Processing Services
Risk Management
Human Resources and Personnel
Indigent Health Care Program Administration
Investments

13. Challenges to the County Auditor
Maintaining Independence
Mastering Diverse Functions – management of cash, debt, grants, & risks, personnel & employment law, budgetary control, internal auditing & financial reporting, etc
Establishing effective working relationships
Content, cont.
Once appointed the County Auditor must be qualified to be an accountant, an auditor, an attorney, an economist, a public relations manager, a financial forecaster, a budget expert, a personnel director, a purchasing agent, a politician, and possibly a resident expert on cleaning compounds and toilet tissue.
Maintaining Independence
Maintaining the independence of the County Auditor from the Commissioners Court and other elected officials.
Mastering Diverse Functions
Mastering diverse functions such as governmental accounting and financial reporting, internal auditing, grants management, debt issuance and management, budgeting and budgetary control, compliance with purchasing laws, personnel matters, and risk management.
Co-Existence
The personalities and politics of working with elected officials, co-existing while exercising oversight and prescriptive authority.
Staff Recruitment
Staff recruitment, retention and development in the County government environment.
“Inherent” Conflicts
”Inherent” conflicts due to the unique nature of the job.

14. Review Four statutory authorities Responsibilities –
Various; the County Auditor is primarily responsible for insuring that county finances comply with the law.
Challenges of the job
Insert Guided Learning: Conduct a guided review of the information and encourage participants to summarize the information for the group
List best-case scenario questions and answers, debate topics or other activities here.
Summary
The county auditor has authority over many functions of the county. Statutory authority includes oversight, access, prescriptive and verification authority.
The county auditor faces several challenges, including:
Maintaining Independence
Mastering Diverse Functions
Co-Existence
Staff Recruitment
“Inherent” Conflicts

15. Resources Texas Association of Counties
Texas Association of County Auditors
Texas Attorney General – Opinion Subjects
Insert Resources to Encourage Retention: Provide participants with an outside assignment, additional reading materials, Web sites and contact information for subject experts
Texas Association of Counties
Article by Tommy Tompkins, Bexar County Auditor
Texas Association of County Auditors
Texas AG Opinions – Cumulative

16. Contact Info
Lisa Smith, Bastrop County Auditor
804 Pecan Street
Bastrop, TX
Katie Conner, Brazos County Auditor
200 S. Texas Ave., Ste 218
Bryan, TX 77803