SENATE BILL 543
52nd legislature - STATE OF NEW MEXICO - first session, 2015
INTRODUCED BY
George K. Munoz
AN ACT
RELATING TO THE STATE FISC; REQUIRING THE STATE TREASURER AND THE DEPARTMENT OF FINANCE AND ADMINISTRATION TO RECONCILE CASH ACCOUNTS DAILY AND TO REPORT AT LEAST QUARTERLY TO THE GOVERNOR AND THE LEGISLATURE ON THE STATE OF THE STATE BUDGET; REQUIRING THIRD-PARTY PAYERS TO CONFORM WITH THE UNIFORM STATEWIDE ACCOUNTING SYSTEM NETWORK.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. [NEW MATERIAL] RECONCILING CASH ACCOUNTS--REPORTS TO GOVERNOR AND LEGISLATURE.--
A. The state shall reconcile its cash accounts each day.
B. The reconciliation shall include a four-tier process as follows:
(1) the state treasurer shall reconcile the daily bank action to the state's register;
(2) the financial control division of the department of finance and administration shall reconcile:
(a) the register to the general journal; and
(b) the general journal to the general ledger; and
(3) the state treasurer shall reconcile balances between the investment banker and the fiscal agent banker.
C. The state treasurer and the director of the financial control division shall prepare a quarterly report for the governor and the legislature through the legislative finance committee and the legislative library that includes the condition of the state budget, including:
(1) each agency's operating budget as to state, federal and other appropriations, approved budget adjustments, encumbrances, expenditures and remaining budget authority;
(2) cash reconciling items that have not been cleared;
(3) the number of cash reconciliation errors during the quarter that have been cleared, the reasons for those errors and whether the problems that caused the errors have been rectified;
(4) the amount of the state reserve accounts; and
(5) a comparison of the state budget to the latest economic forecast.
SECTION 2. Section 6-5-2 NMSA 1978 (being Laws 1957, Chapter 252, Section 2, as amended) is amended to read:
"6-5-2. FINANCIAL CONTROL DIVISION--CENTRAL SYSTEM OF STATE ACCOUNTS--ACCOUNTING SYSTEMS--PROCESSING DOCUMENTS--MODEL ACCOUNTING PRACTICES--INTERNAL ACCOUNTING CONTROLS.--
A. The division shall maintain a central system of state accounts and shall devise, formulate, approve, control and set standards for the accounting methods and procedures of all state agencies and third-party payers. The division shall prescribe procedures, policies and processing documents for use by state agencies and third-party payers in connection with fiscal matters and may require reports from state agencies as may be necessary to carry out its duties and functions. Procedures and policies issued by the division are exempt from the uniform standards of style and format promulgated by the state commission of public records.
B. The division shall issue a manual of model accounting practices containing the procedures and policies prescribed pursuant to Subsection A of this section and shall annually review and, if necessary, revise and reissue the manual. State agencies and third-party payers shall comply with the model accounting practices established by the division, and the administrative head of each state agency shall ensure that the model accounting practices are followed.
C. State agencies and third-party payers shall implement internal accounting controls designed to prevent accounting errors and violations of state and federal law and rules related to financial matters. In addition, state agencies and third-party payers shall implement controls to prevent the submission of processing documents to the division that contain errors or that are for a purpose not authorized by law."
SECTION 3. Section 6-5-2.1 NMSA 1978 (being Laws 2003, Chapter 273, Section 9) is amended to read:
"6-5-2.1. DIVISION--ADDITIONAL DUTIES.--The division shall:
A. coordinate all procedures for financial administration and financial control and integrate them into an adequate and unified system, including the devising, prescribing and installing of processing documents, records and procedures for state agencies and third-party payers;
B. collect and maintain the necessary information to produce ledgers, journals, registers and other supporting records and analyses;
C. maintain information that adequately supports all entries in the state general ledger;
D. verify and control state agency compliance with allotments;
E. conduct all central accounting and fiscal reporting for the state as a whole and produce interim statewide financial reports and the state's comprehensive annual financial statements;
F. prescribe, develop, operate and maintain a uniform statewide accounting system network;
G. prescribe and approve the installation of any changes in the statewide accounting system network as necessary to secure and maintain internal control and facilitate the recording of accounting data in order to prepare reliable and meaningful statements and reports;
H. prescribe the uniform classification of accounts to be used by state agencies;
I. operate a central payroll system;
J. perform [monthly] daily reconciliations with the balances and accounts kept by the state treasurer and adopt and promulgate rules regarding reconciliation for state agencies and third-party payers;
K. prescribe and revise procedures, techniques and formats for electronic data transmission to improve the flow of data among state agencies;
L. monitor reversion of unexpended general fund balances by September 30 of each year;
M. promulgate rules relating to the acceptance of credit, charge and debit cards for the payment of fees, taxes and other charges assessed by state agencies;
N. store and maintain records electronically;
O. establish, with the attorney general's approval, a procedure for electronic signatures;
P. maintain accounts and information as necessary to show the sources of state revenues and the purposes for which expenditures are made and provide proper accounting controls to protect state finances;
Q. make improvements in the state's model accounting practices, systems and procedures;
R. assist state agencies and third-party payers in resolving financial questions or problems;
S. have access to and authority to examine books, accounts, reports, vouchers, correspondence files and other records, bank accounts, money and other property of a state agency; and
T. consult with the state auditor to promote better financial statement reporting."
SECTION 4. Section 8-6-3.1 NMSA 1978 (being Laws 1993, Chapter 105, Section 1) is amended to read:
"8-6-3.1. STATE CASH MANAGER--POWERS AND DUTIES.--
A. The "office of the state cash manager" is established under the office of the state treasurer. The state treasurer shall appoint the state cash manager who shall manage efficiently all state cash balances in the custody of the state not otherwise invested or deposited and, in consultation with the state board of finance, perform the duties necessary to carry out that management responsibility.
B. The duties of the state cash manager include:
(1) issuance of cash management [regulations] rules, procedures and enforcement policy to assure implementation of and compliance with the federal Cash Management Improvement Act of 1990 and other provisions of law;
(2) obtaining from each state agency [periodic] daily reports of all money from any source in the agency's custody, including detailed information on receipts, disbursements and balances on hand or on deposit in a financial institution;
(3) [periodic] daily review of all deposits made and balances on hand to assure that all money received by each state agency is deposited in a timely manner in the state fiscal agent bank and, if applicable, to the state agency's account in the state treasury;
(4) projection of the state's short-term and long-term cash needs to determine the amount available for short-term and long-term investment;
(5) determination and periodic update of the warrant clearance pattern to project the time lag between warrant issuance date and warrant clearance date to facilitate cash management activities; [and]
(6) preparation of a monthly written report showing state fund balances in each financial institution and sending the report to the state board of finance, the legislative finance committee, the legislative council service, the state investment council, the educational retirement board and the retirement board of the public employees retirement association; and
(7) preparation, with the financial control division of the department of finance and administration, of the quarterly state budget report required by Section 1 of this 2015 act.
C. In addition to the specific duties in Subsection B of this section, the state cash manager shall ensure that non-income producing state cash balances are kept to a minimum in accordance with established guidelines. The state cash manager shall report any actual or anticipated deviations from such established guidelines to the state board of finance, the investing board or council and the legislative finance committee.
D. The state cash manager shall have access to all accounts, files and other records of funds in the custody of the state. Upon approval of the state [board of finance] treasurer, the state cash manager may conduct any periodic investigation [he] the state cash manager deems necessary to enable [him] the state cash manager to perform [his] the duties pursuant to this section.
E. As used in this section, "state agency" means the state of New Mexico or any of its branches, agencies, departments, boards, instrumentalities or institutions, other than state educational institutions designated by Article 12, Section 11 of the constitution of New Mexico, and includes the New Mexico mortgage finance authority and the New Mexico finance authority."
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