The areas listed below are categorized by audit type. The directives listed below are required by the State Auditor's Office per N.D.C.C. 54-10-14(4). The audit report (or working papers) may be reviewed by the Auditor's Office to ensure the directives were included in the audit.
Independent Public Accountants conducting local government audits within North Dakota under the purview of the State Auditor's Office must complete a registration form required per N.D.C.C. 54-10-14(4). This registration can be found here.
(Last updated on February 12, 2024)
County Audit Directives
County Budgets | March 15, 2022
We have found that in many county audits, supporting documentation for county budgets are either absent, or incorrect.
Our office is responsible to review fiscal concerns that come to our attention. Beginning with 2021 financial audits, all county audits issued must include the county budget in the planning, testing and conclusions.
Areas that must be looked at:
- Ensure all sections of N.D.C.C. 11-23-02 are included in the audit period’s final budget
- Inquire, if necessary, for understanding of the budget process
- Obtain the clients budget file to ensure all elements are included
- Test various elements of the budget to ensure compliance (see common issues below)
- Conclude on compliance with N.D.C.C. 11-23-02
Common issues found:
- Estimated cash balances lack supporting documentation
- Transfers in and out not balancing
- Cash reserve over what is allowed
- Overall budget not complete
- Revenue and expenditure estimates lacking supporting documentation
- Common funds with problems include: General fund, County Road and Bridge fund, Noxious Weed fund
- No documentation on how the mill levy was determined
If the county budget concerns are not addressed, the auditor may receive a correction letter. This may also result in the Office of the State Auditor conducting the next audit (North Dakota Century Code 54-10-13).
Generally Accepted Accounting Principles Audit | January 10, 2024
N.D.C.C. 11-11-11(4) requires county auditors to prepare general purpose financial statements annually by November 15th, in accordance with generally accepted accounting principles (GAAP). Beginning with 2023 audits, the State Auditor's Office will require all county audits to be done as GAAP audits.
City Audit Directives
City Budgets | January 16, 2024
We have found that in many city audits, supporting documentation for budgets are either absent, or incorrect.
Our office is responsible to review fiscal concerns that come to our attention. Beginning with calendar year end 2023 financial audits, all city audits issued must include the budget in the planning, testing and conclusions.
Areas that must be looked at:
- Ensure all sections of N.D.C.C. 40-40-08 are included in the audit period’s final budget including the items from the preliminary budget as shown in 40-40-05
- Ensure the amount levied is in accordance with N.D.C.C. 40-40-09
- Ensure the cash reserve/interim fund identified in N.D.C.C. 40-40-09 is in accordance with N.D.C.C. 57-15-27
- Obtain the clients budget file to ensure all elements are included
- Test various elements of the budget to ensure compliance (see common issues below)
- Conclude on compliance with N.D.C.C. 40-40-08, N.D.C.C. 40-40-09, and N.D.C.C. 57-15-27
Common issues found:
- Estimated cash balances lack supporting documentation
- Transfers in and out not balancing
- Cash reserve over what is allowed
- Overall budget not complete
- Revenue and expenditure estimates lacking supporting documentation
- No documentation on how the mill levy was determined
If the city budget concerns are not adequately addressed, the auditor may receive a correction letter. (North Dakota Century Code 54-10-13).
Park District Audit Directives
Park District Budgets | January 16, 2024
We have found that in many park district audits, supporting documentation for budgets are either absent, or incorrect.
Our office is responsible to review fiscal concerns that come to our attention. Beginning with calendar year end 2023 financial audits, all park district audits issued must include the budget in the planning, testing and conclusions.
Areas that must be looked at:
- Ensure all sections of N.D.C.C. 40-40-08 are included in the audit period’s final budget including the items from the preliminary budget as shown in 40-40-05
- Ensure the amount levied is in accordance with N.D.C.C. 40-40-09
- Ensure the cash reserve/interim fund identified in N.D.C.C. 40-40-09 is in accordance with N.D.C.C. 57-15-27
- Obtain the clients budget file to ensure all elements are included
- Test various elements of the budget to ensure compliance (see common issues below)
- Conclude on compliance with N.D.C.C. 40-40-08, N.D.C.C. 40-40-09, and N.D.C.C. 57-15-27
Common issues found:
- Estimated cash balances lack supporting documentation
- Transfers in and out not balancing
- Cash reserve over what is allowed
- Overall budget not complete
- Revenue and expenditure estimates lacking supporting documentation
- No documentation on how the mill levy was determined
If the park budget concerns are not adequately addressed, the auditor may receive a correction letter. (North Dakota Century Code 54-10-13).