This bill mandates the Division of Taxation to conduct audits of out-of-State contractors that have entered into contracts with the State or private entities. The audits will assess whether administrative expenses related to these contracts are properly allocated and reasonable, review the internal financial controls of the contractors, and evaluate their annual financial reports. Additionally, the Division will establish a toll-free hotline for confidential reporting of suspected wrongdoing or issues concerning out-of-State contractors.

The results of each audit will be submitted to the contracting agency that awarded the State contract, while an annual audit report will be provided to the Governor and the Legislature. This initiative aims to ensure that out-of-State contractors are adequately equipped to fulfill their contractual obligations to the State and to enhance oversight of public funds.