State law limits audit fees and sets payment rules

The state auditor may not charge higher education institutions and certain related agencies audit fees, except for an allowed share of federal program costs. This applies to higher education institutions and agencies or offices controlled by the state board of higher education, including pass-through grants. The exception covers only the share of federal program or grant costs that the program or grant allows the state to recover. Institutions without an approved fund for indirect costs may not be charged audit fees on closed federal programs.

A political subdivision may make progress payments to its public accountant for an audit. This applies to political subdivisions paying a public accountant to conduct an audit. The political subdivision must hold back 25 percent of any progress payment until the state auditor accepts the audit.

The state auditor must report quarterly to a legislative committee on audit billing, completed audits, and audit schedules. The reports go to the legislative audit and fiscal review committee and cover audits by the state auditor's office and private firms. Reports on completed audits include the organization and audit details, estimated and actual hours and costs, and total cost as a share of the organization's operating budget. The state auditor must report quarterly.

An occupational or professional board may submit an annual report instead of arranging an audit every two years. This option is for occupational and professional boards that meet the annual-receipts limit, but the limit is unclear in the text. The report must include information required by the state auditor. The state auditor may still conduct an additional examination or audit, and may charge for that work if the board does not file its report. The annual-receipts threshold is unclear in the text, so which boards qualify cannot be stated confidently.