California Code of Regulations
Title 10 - Investment
Chapter 5 - Insurance Commissioner
Subchapter 9 - Insurance Fraud
Article 8 - Disability Insurance Fraud Assessment Grant Program
Section 2698.98.1 - District Attorney Reporting and Commissioner's Audit

Universal Citation: 10 CA Code of Regs 2698.98.1

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

Each district attorney receiving funds pursuant to Insurance Code section 1872.85 shall submit an annual report to the Commissioner regarding the local program and its accomplishments. Failure to submit the annual report shall affect subsequent funding decisions. The report shall include the following items:

(a) An Expenditure Report, which shall include information for the following:

(1) Personnel: salaries and benefits.

(2) Operations costs breakdown.

(3) Explanation of any significant variances from the county's application as approved.

(b) A financial Audit Report prepared by an independent, qualified state or local government auditor or independent public accountant licensed by the State of California or the county Auditor Controller. The Audit Report shall reflect that local expenditures were made for the purposes of the program as specified in section 1872.85 of the Insurance Code, these Regulations, the guidelines in the Request for Application and the county's application.

(1) The auditor shall use county policies and procedures as the standard for verifying appropriateness of personnel and support costs.

(2) In the event that the program audit is included as part of an organization-wide audit, revenues and expenditures for the local program must be shown separately.

(c) Except as provided in this section, financial audits under this program shall be performed in accordance with the standards set forth in Government Auditing Standards (Revised June 2003) published by the Comptroller General of the United States, General Accounting Office. The above Government Auditing Standards (Revised June 2003) are incorporated herein by this reference.

(d) A Program Report which shall include the following:

(1) The number of investigations initiated related to disability insurance fraud.

(2) The number of arrests related to disability insurance fraud.

(3) The number of prosecutions related to disability insurance fraud.

(4) The number of convictions related to disability insurance fraud.

(5) The dollar savings realized as a result of disability insurance fraud case prosecutions.

(6) A summary of the activity directed toward the reduction of disability insurance fraud with the following:
(A) Fraud Division.

(B) Insurance companies.

(e) The deadlines for submissions are as follows:

(1) Expenditure Reports and Audit Reports must be submitted to the Commissioner no later than four (4) months after the close of the funding cycle as specified in the Request for Application. A county may request an extension in the event an organization-wide audit will delay submission of the audit.

(2) Program Reports must be submitted to the Commissioner no later than (2) months after the close of the funding cycle as specified in the Request for Application.

(f) There shall be a grant liquidation period of ninety (90) days following the termination of the funding cycle during which costs incurred but not paid may be paid and deducted from the program budget.

(g) The Commissioner may perform such additional audits or reviews of any local programs as the Commissioner may deem necessary and shall have access to all working papers, correspondence, or other documents, including audit reports and audit working papers related to the audit report or local program.

(h) Notwithstanding any other provision of the law, the Commissioner shall perform a fiscal audit of the program administered under this section once every three years.

1. New section filed 11-3-2005; operative 12-3-2005 (Register 2005, No. 44).
2. Change without regulatory effect amending subsection (g) filed 7-14-2021 pursuant to section 100, title 1, California Code of Regulations (Register 2021, No. 29). Filing deadline specified in Government Code section 11349.3(a) extended 60 calendar days pursuant to Executive Order N-40-20.

Note: Authority cited: Section 1872.85, Insurance Code; and CalFarm Insurance Company, et al. v. Deukmejian, et al. (1989) 48 Cal.3d 805 and 824. Reference: Section 1872.85, Insurance Code.

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