A BILL TO BE ENTITLED
AN ACT to modify the community colleges program auditing function.
The General Assembly of North Carolina enacts:
SECTION 1.  Section 10.15(a) of S.L. 2013‑360 is repealed.
SECTION 2.  G.S. 115D‑5(m) reads as rewritten:
"(m)	The Office of State Auditor shall maintain an accountability function that conducts periodic reviews of each community college operating under the provisions of this Chapter. The purpose of the compliance review shall be to ensure that (i) data used to allocate State funds among community colleges is reported accurately to the System Office and (ii) community colleges are charging and waiving tuition and registration fees consistent with law. The State Board of Community Colleges shall require the use of a statistically valid sample size in performing compliance reviews of community colleges. All compliance review findings that are determined to be material shall be forwarded to the college president, local college board of trustees, the State Board of Community Colleges, and the State Auditor. The State Board of Community Colleges shall adopt rules governing the frequency, scope, and standard of materiality for compliance reviews."
SECTION 3.  G.S. 115D‑58.16 reads as rewritten:
"§ 115D‑58.16.  Audits.
(a)	Each community college shall be subject to a financial audit a minimum of once every two years. Community colleges shall contract with the State Auditor to perform the audits and shall use Sate funds to pay for these contracts. The colleges shall submit the results of the audits to the State Board of Community Colleges.
The State Board of Community Colleges shall ensure that all colleges are audited in accordance with this section.
(b)	Notwithstanding the provisions of Chapter 143D of the General Statutes, a community college shall not be subject to the EAGLE program administered by the Office of the State Controller unless (i) there is a finding of internal control problems in the most recent financial audit of the college or (ii) the State Board of Community Colleges determines that a college should be subject to the program."
SECTION 4.  Sections 2 and 3 of this act become effective July 1, 2015, and apply to compliance reviews beginning with the 2015‑2016 academic year. The remainder of this act is effective when the act becomes law.