Cal. Gov. Code § 13401

(a) The Legislature hereby finds the following: (1) Active oversight processes, including regular and ongoing monitoring processes, for the prevention and early detection of fraud and errors in program administration are vital to public confidence and the appropriate and efficient use of public resources. (2) Fraud and errors in state programs are more likely to occur from a lack of effective systems of internal accounting and administrative control in the state agencies when active monitoring measures are not maintained to ensure that accounting and administrative controls are functioning properly. (3) Effective systems of internal accounting and administrative control provide the basic foundation upon which a structure of public accountability must be built. (4) Effective systems of internal accounting and administrative control are necessary to ensure that state assets and funds are adequately safeguarded, as well as to produce reliable financial information for the agency. (5) Systems of internal accounting and administrative control are necessarily dynamic and must be routinely monitored, continuously evaluated, and, where necessary, improved. (6) Reports regarding the continuing adequacy of the systems of internal accounting and administrative control of each state agency are necessary to enable the executive branch, the Legislature, and the public to evaluate the agency’s performance of its public responsibilities and accountability.

(b) The Legislature declares it to be the policy of the State of California that: (1) Each state agency must maintain effective systems of internal accounting and administrative control as an integral part of its management practices. (2) The systems of internal accounting and administrative control of each state agency shall be evaluated on an ongoing basis through regular and ongoing monitoring processes and, when detected, weaknesses must be promptly corrected. (3) All levels of management of the state agencies must be involved in assessing and strengthening the systems of internal accounting and administrative control to minimize fraud, errors, abuse, and waste of government funds, however, key monitoring processes should be structured to ensure the independence and objectivity of persons tasked with such monitoring. (4) It shall be the responsibility of the Department of Finance, in consultation with the Controller and State Auditor, to establish guidelines for how the independence and objectivity of the persons tasked with monitoring processes are to be maintained. Such guidelines should include establishing monitor training programs, identification of appropriate chain-of-command reporting relationships, and recommended best practices for professional development and the conduct of independent monitoring, including practices for the regular dissemination of strategies and lessons learned from successful efforts to strengthen state administration via interagency cooperation.