California Code, Government Code - GOV § 13306

(a) The Department of Finance, with the concurrence of the Controller, may establish additional funds as are necessary to properly manage and account for the financial activities and resources of the state, provided that only the minimum number of funds necessary to comply with legal requirements, “Generally Accepted Accounting Principles,” and effective financial administration shall be established.  The department may abolish funds established under the authority of this subdivision.

(b) The Department of Finance, with the concurrence of the Controller, may abolish funds established by statute that have been inactive for a period of four years upon notification in writing to the Joint Legislative Budget Committee.  Abolition of funds established by statute shall become effective no earlier than 30 days after the date of this notification.  If these funds are abolished and subsequently are found to be needed, the department, with the concurrence of the Controller, may reestablish these funds.

(c) Because complete conformance to “Generally Accepted Accounting Principles” may be impractical or not authorized, the Department of Finance is authorized to deviate from them if conformance would not be in the best interests of the state, and if the department notifies the Controller of additional major deviations and the Controller agrees with the deviations prior to implementation.

(d) The Department of Finance shall notify the Joint Legislative Budget Committee when major changes are proposed to the accounting system to bring it into conformance to “Generally Accepted Accounting Principles.”  The notification shall include an estimate of the fiscal effect of the major changes being proposed.