FOR AN ACT ENTITLED, An Act to clarify certain duties and authority pertaining to the auditor-general and the Department of Legislative Audit.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
     Section  1.  That § 4-2-2 be amended to read as follows:
     4-2-2.   The powers and duties of the Department of Legislative Audit shall be executed and performed by and under the direction of an auditor-general who shall be an experienced public accountant, and who shall be appointed to the office of auditor-general by a concurrent joint resolution of the two houses of the state Legislature. The term of office of the auditor-general shall be eight years and until the appointment and qualification of his a successor. Should If the office be becomes vacant when the Legislature is not in session, the Executive Board of the Legislative Research Council shall appoint an auditor-general to serve until the next legislative session and the appointment and qualification of his a successor.
     Section  2.  That § 4-2-8 be amended to read as follows:
     4-2-8.   The Executive Board of the state Legislative Research Council is hereby empowered to shall act on behalf of the Legislature in directing the activities of the auditor-general. The auditor-general is directly responsible to the Executive Board of the Legislative Research

Council whenever the Legislature is not in session.

     Section  3.  That § 4-11-2 be amended to read as follows:
     4-11-2.   The Department of Legislative Audit shall perform financial and compliance audits in accordance with generally accepted government auditing standards , approved by the Executive Board of the Legislative Research Council, of all state officers, constitutional offices and all state departments, agencies, boards, and commissions, including all penal, charitable, and educational institutions, and all regulatory boards and commissions receiving any of which receive funds by appropriation or whose expenditure of funds is pursuant to law. Such audit shall be made at least once every two years and without notice to the office, department, board, agency, commission or institution entity to be audited. Any regulatory board or commission whose average annual expenditures for the last three years did not exceed fifty thousand dollars may file an annual report with the Department of Legislative Audit in lieu of an audit. The Department of Legislative Audit shall prescribe the format of the annual report to be filed.
     Section  4.  That § 4-11-3 be amended to read as follows:
     4-11-3.   A special audit, investigation , or examination of any of such matters specified in §   4-11-2 or of any additional matter relating to state affairs , directly or indirectly , shall also be made at any time upon written order of the Governor , approved by the Executive Board of the Legislative Research Council, and a report shall likewise be made of such special audit, investigation , or examination and filed with the Governor , the Legislative Research Council, and secretary of state and be subject to public inspection . Any report so filed may be inspected by the public in the Office of Secretary of State.
     Section  5.  That § 4-11-4 be amended to read as follows:
     4-11-4.   The auditor-general shall cause audits as follows in accordance with generally accepted government auditing standards, approved by the Executive Board of the Legislative Research Council, of the following :

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             (1)      Financial and compliance audits in accordance with generally accepted government auditing standards of each municipality and county in the state, shall be made at least once every two years;

             (2)      Municipalities with less than six hundred thousand dollars in annual revenue that are required to have an audit pursuant to federal regulations shall be audited in accordance with federal guidelines;

             (3)      Municipalities with less than six hundred thousand dollars in annual revenue that are not required to have an audit pursuant to federal regulations may submit an annual report in lieu of a formal audit. Municipalities may subtract the annual revenue received from any municipal enterprise or utility system except utility systems defined in §   9-40-1 from total annual revenue, if the municipal enterprise or utility is audited separately. This report shall be submitted to the auditor-general on forms prescribed by the Department of Legislative Audit.

     The auditor-general may audit the books and records of any office or officer of any political subdivision if it is requested by the governing body or if the auditor-general finds that special reasons exist.
     Section  6.  That § 4-11-8 be amended to read as follows:
     4-11-8.   No examination or audit of the books and accounts of a public corporation shall may extend back more than six years from the date such examination is commenced, unless by request of the governing body thereof or upon petition of not less than ten percent of the taxpayers thereof as shown by the last assessment roll, or in case of the state upon order of the Governor , approved by the Executive Board of the Legislative Research Council .
     Section  7.  That § 4-11-9 be amended to read as follows:
     4-11-9.   The auditor-general shall make detailed reports of the result of any audits or investigations made by the Department of Legislative Audit within sixty days after such audits

or investigations have been completed. The auditor-general shall file reports of state agencies with the Executive Board of the Legislative Research Council, the Governor , and the respective state agency. The auditor-general shall file reports of political subdivisions with the Executive Board of the Legislative Research Council, the respective governing board , and finance director.
     Section  8.  That § 4-11-11 be amended to read as follows:
     4-11-11.   The auditor-general shall at all times keep on file in his the office of the Department of Legislative Audit the original copy and such additional copies as may be deemed necessary of any report of investigations, audits , or examinations made by his the department or any private audit under the provisions of this chapter. All of the reports shall at all times be open to public inspection ten days after date of filing in with the Executive Board of the Legislative Research Council or the Governor, Attorney General, secretary of state or any of the public offices specified pursuant to the provisions of this chapter .
     Section  9.  That § 4-11-14 be amended to read as follows:
     4-11-14.   If any report provided herein compiled pursuant to the provisions of this chapter discloses malfeasance, misfeasance , or neglect of duty on the part of an any public employee or officer, upon receipt of a copy of such report it shall be the duty of , the proper legal officer , and he is authorized and required to shall institute in the proper court, within sixty days from the receipt thereof , a civil action on behalf of the state or taxing district to which the right of action has accrued and promptly prosecute the same to final determination to recover any fees or public funds misappropriated, or to otherwise determine the rights of the parties in the premises. If the political subdivision has no legal officer assigned to it, it shall employ one at its expense, to act under the supervision of the attorney general. If the proper legal officer does not institute a civil action within sixty days, the officer shall file a report with the Department of Legislative Audit and the Executive Board of the Legislative Research Council stating the officer's reasons for not instituting such civil action.

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     Section  10.  That § 4-11-15 be amended to read as follows:
     4-11-15.   The Department of Legislative Audit, the Executive Board of the Legislative Research Council, and the attorney general shall be notified at the beginning of any action, and kept fully advised of the progress thereof , and it shall not be lawful for any . No board of county commissioners or board of other taxing district to may make a settlement or compromise of any claim exceeding the sum of three hundred dollars, or of any civil action or controversy arising out of such malfeasance, misfeasance or neglect of duty so reported, nor for may any court to enter any compromise or settlement of such civil action, without giving notice thereof to the attorney general and allowing him who shall be allowed to be heard in the matter.
     Section  11.  That § 4-11-16 be amended to read as follows:
     4-11-16.   It shall be the duty of The Executive Board of the Legislative Research Council, the Governor , and of the attorney general to see shall provide that the provisions of § §   4-11-14 and 4-11-15 are faithfully complied with and upon refusal or neglect of the proper legal officer to institute a civil action as herein provided , the attorney general shall have the power to may institute and prosecute such action to final determination at the expense of the subdivision or agency involved. Nothing contained in § §   4-11-14 to 4-11-16, inclusive, shall in any manner bar , bars or prejudice prejudices any criminal actions action or prosecutions prosecution which may be applicable.
     Section  12.  That § 4-11-17 be amended to read as follows:
     4-11-17.   It shall be the duty of the The attorney general, when if called upon by the auditor-general, to shall aid in any investigation or matter needing legal advice or inquiry , and to . The attorney general shall supervise the prosecution of all offenders under the laws relating thereto.
     Section  13.  That § 4-11-21 be amended to read as follows:
     4-11-21.   The identity of a person supplying information to the Department of Legislative

Audit in conjunction with the performance of any audit authorized by this chapter may be kept confidential if requested by that person and such confidentiality is determined by the auditor- general , pursuant to policies approved by the Executive Board of the Legislative Research Council, to be appropriate under the circumstances. After a determination of confidentiality has been made, the identity of the person supplying the information may not be disclosed except pursuant to written consent of that person or by court order. No person may use a subpoena, discovery, or other applicable statute to obtain the identity of the person. This section does not apply to requests from the attorney general or any law enforcement officers officer of any municipality, county, state, or federal agency or department for such information reasonably necessary for any criminal investigation or prosecution .