The Senate Education committee recommended passage of SB494 with amendments after hearing testimony from the Hawaii Public Charter School Commission clarifying the commission’s existing financial audit processes.

PJ Forrer, executive director of the Public Charter School Commission, told the committee that charter schools currently undergo annual independent financial audits in accordance with statute and generally accepted auditing standards. Forrer said the commission assigns auditors, performs a risk assessment and includes audits in its annual report. He asked the committee to note those existing practices while the Legislature considers any additional audit requirements.

Committee members asked why prior audits had not uncovered some problems publicized in the news. Forrer said follow-up and risk-assessment practices are used and that when issues appear they are investigated and addressed; the commission noted that its financial-performance framework has been refined over time. The committee adopted amendments and voted to pass SB494 with the recommended changes; the hearing transcript records the committee adopting the recommendation.

Votes and outcome: The committee voted to pass SB494 with amendments and defect the effective date to 07/01/2050. The committee recorded five members voting in the affirmative and the recommendation was adopted.

Why this matters: The bill would add a statutory audit requirement and a report to the Legislature; the commission said it already requires annual audits and agreed to coordinate with the auditor and Budget & Finance on any additional statutory audit work requested by the Legislature.