Tex. Education Code § 29.363

(a) The comptroller shall contract with a private entity to audit accounts and program participant eligibility data not less than once per year to ensure compliance with applicable law and program requirements. The audit must include a review of:

(1) each certified educational assistance organization's internal controls over program transactions; and

(2) compliance by:

(A) certified educational assistance organizations with Section 29.354 and other program requirements;

(B) program participants with Section 29.357(a) and other program requirements; and

(C) education service providers and vendors of educational products with Section 29.358 and other program requirements.

(b) In conducting an audit, the private entity may require a program participant, education service provider or vendor of educational products, or certified educational assistance organization to provide information and documentation regarding any transaction occurring under the program.

(c) The private entity shall report to the comptroller any violation of this subchapter or other relevant law and any transactions the entity determines to be unusual or suspicious found by the entity during an audit conducted under this section. The comptroller shall report the violation or transaction to:

(1) the applicable certified educational assistance organization;

(2) the education service provider or vendor of educational products, as applicable; and

(3) each participating parent who is affected by the violation or transaction.

(d) The state auditor shall audit each certified educational assistance organization's compliance with the organization's duties to verify a child's eligibility to participate in the program under Section 29.355 and verify that a request for payment is for an approved expense under Section 29.360(c). Each organization shall submit to the state auditor documentation of:

(1) each item of residency documentation described by Section 29.355(a-1) reviewed by the organization;

(2) each preapproved education-related expense category reviewed by the organization under Section 29.360(c);

(3) the number of transactions approved by the organization; and

(4) the number of transactions denied by the organization.

(e) The state auditor may review and analyze individual transactions approved by a certified educational assistance organization.

(f) The state auditor shall randomly select 10 percent of program applications on which to perform an eligibility verification audit.

(g) Each education service provider shall provide to the state auditor proof of a third-party audit or financial review consistent with the provider's accreditation commission standards.