The bill amends various sections of the Government Code to enhance the internal auditing program conducted by state agencies in Texas. It establishes clearer guidelines for internal auditing, emphasizing the importance of providing independent, risk-based assurance and advisory services to agency administrators and governing boards. Notably, the definition of internal auditing is revised to focus on strengthening an organization's ability to create and sustain value, while the term "advisory services" is introduced to encompass consulting activities that improve operations without providing assurance or management responsibilities.

Key amendments include the requirement for state agencies to develop an annual audit plan based on risk assessment techniques, and the internal auditor's responsibilities are expanded to include communication of both advisory and assurance service results. The bill also updates the standards for internal audits to align with the Global Internal Audit Standards, replacing previous references to the Professional Practices Framework. Additionally, certain outdated provisions are deleted, streamlining the language and focus of the internal auditing process. The bill is set to take effect immediately upon receiving a two-thirds vote or on September 1, 2025, if that threshold is not met.

Statutes affected:
Introduced: ()
House Committee Report: Government Code 2102.002, Government Code 2102.003, Government Code 2102.005, Government Code 2102.007, Government Code 2102.008, Government Code 2102.0091, Government Code 2102.011 (Government Code 2102)
Engrossed: Government Code 2102.002, Government Code 2102.003, Government Code 2102.005, Government Code 2102.007, Government Code 2102.008, Government Code 2102.0091, Government Code 2102.011 (Government Code 2102)