Understanding the Political Subdivision Audit and Review Requirements
The North Dakota State Auditor's Office is responsible for ensuring local governments comply with financial rules and regulations.
Who Needs an Audit or Review?
State law (N.D.C.C. 54-10) requires local governments to either:
- Submit an audit at least once every two years, or
- Submit an annual financial review form.
Use the flowchart below to determine your specific requirements. If you have questions, call the Office of Good Government at 701-328-9083.
If a local government is interested in inquiring about the State Auditor’s Office audit services and availability, please contact us for a cost proposal at 701-328-2241 or e-mail us at ndsao@nd.gov.
Instructions for the Annual Review Process
- Download the Financial Review form by clicking the button below. Complete the form using Excel on your computer, do not print the form. The form will automatically fill in some information you need when you fill it out electronically. There are instructions on the first tab.
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- You will also need to submit the following with that form:
- A copy of 12 Months of bank statements. Gather bank statements for all checking accounts for the past 12 months.
- A copy of year-end statements for other cash accounts. Collect year-end statements for savings, Certificate of Deposits, or any other cash accounts you may have.
- A copy of year-end debt statement by account or debt payment schedule. Obtain a year-end debt statement for each account, or a debt payment schedule that outlines outstanding balances and payments.
A copy of Trial balance, profit and loss, or statement of activities. Retrieve a report that summarizes all financial activity in the ledger, like a trial balance, profit and loss statement, or statement of activities.
To view all these items in a printable checklist, download the checklist here.
3. When you have all of those items filled out, submit them electronically to: saoadmin@nd.gov. If you have questions, call the Office of Good Government at 701-328-9083.
What Happens After Everything Has Been Submitted?
What Happens During the Review?
Our team will:
- Verify fund balances match the balances held at the bank.
- Confirm long-term debt reported matches to debt statements.
- Ensure required fund breakouts are reported.
If discrepancies are found, we may also:
- Check for outstanding checks or deposits.
- Compare bank and accounting records to identify missing transactions.
Some reviews may require a deeper look based on risk factors. This review is called an Extended Review. This could include:
- Checking expenditures records.
- Reviewing of bidding requirements.
- Confirming payroll taxes were filed correctly.
- Confirming payroll was supported.
- Ensuring proper FDIC insurance or bank pledges.
- Reviewing negative fund balances.
What if an entity can't complete the form?
If an entity is unable to complete the annual financial review form because of workload constraints or specific circumstances — such as lack of access to Excel or a computer — the Auditor’s Office may be able to assist by preparing and submitting the review form on their behalf.
Entities that are unable to complete the form on their own should submit a request, along with an explanation, to: ogg@nd.gov.
What will it cost?
Based on the hours it takes to complete, and what the law allows the Auditor’s Office to charge which is currently $90 per hour.
Looking for a specific audit or review?
To find an entity on our website, click on Local Government Reports in the header. Then, select the type of entity you are looking for. If you can’t find it, it may be part of a larger government unit. For example, a library might be included in a city or county audit. Try checking the city or county where the entity is located.