4-11-1      Repealed.
4-11-2      Annual audit of state accounts--Scope.
4-11-2.1      Charitable or nonprofit corporations to comply with certain audit requirements.
4-11-3      Special audit of state accounts on Governor's order--Report of audit.
4-11-4      Audit of municipal and county records--Frequency of examination--Federal guidelines--Annual report in lieu of audit.
4-11-4.1      Internal control review for certain municipalities.
4-11-5      Special audit of local accounts on request by governing body or taxpayers--Cost of examination.
4-11-6      Accounting manual for counties, municipalities, school districts, and their agencies.
4-11-7      Audit by private accountant--Acceptance in lieu of required audit.
4-11-7.1      School district audit by private auditing firm.
4-11-7.2      Publication of school district audit results.
4-11-8      Period of transactions covered by audit--Exceptions.
4-11-9      Reports of audits--Place of filing.
4-11-10      Contents of audit reports.
4-11-11      Filing of audit reports--Open to public inspection.
4-11-12      Publication of notice of county, municipal and school district audit reports--Contents and expense of notice.
4-11-13      Copies of audit reports received in evidence.
4-11-14      Civil action to recover misappropriated funds disclosed by audit report.
4-11-15      Notice to attorney general of civil actions--Compromise of actions.
4-11-16      Attorney general to oversee or institute civil actions--Criminal prosecutions not affected.
4-11-17      Attorney general to assist and supervise prosecutions.
4-11-18      Costs of audits charged to state agencies and local bodies--Computation--Witness fees and expenses--Collection of claims.
4-11-19      Deposit and crediting of reimbursed amounts.
4-11-20      Audit of vouchers, claims, and accounts of Department of Legislative Audit.
4-11-21      Confidential identity of person supplying information to department.

4-11-1. Repealed by SL 1985, ch 34, § 1.

4-11-2. Annual audit of state accounts--Scope.

The Department of Legislative Audit shall perform an annual financial and compliance audit of the State of South Dakota in accordance with generally accepted government auditing standards. The scope of the audit shall include all state officers, departments, agencies, boards, commissions, penal, charitable, and educational institutions, and all regulatory boards and commissions receiving funds by appropriation or that expend funds pursuant to state law. In addition, the Department of Legislative Audit may perform financial and compliance audits of individual state officers, departments, agencies, boards, commissions, penal, charitable, and educational institutions, and all regulatory boards and commissions receiving funds by appropriation or that expend funds pursuant to state law, if deemed necessary and in the public interest by the auditor-general.

Source: SL 1943, ch 258, § 6; SL 1953, ch 293; SDC Supp 1960, § 55.2906 (1); SL 1966, ch 165, § 4; SL 1968, ch 205, § 2; SL 1985, ch 34, § 2; SL 1992, ch 39; SL 2003, ch 30, § 1.

4-11-2.1. Charitable or nonprofit corporations to comply with certain audit requirements.

Any charitable or nonprofit corporation receiving federal funds through the state or its political subdivisions, that is required to be audited in accordance with the Federal Single Audit Act Amendments of 1996 Public Law 104-156 (31 U.S.C. sections 7501 to 7507) as amended to January 1, 2003, shall comply with the provisions of § 4-11-7, except for the restrictions on payment for the audit, when hiring a public accountant to perform the audit. The auditor-general may examine all financial records, related to funds provided by the state or its political subdivisions, of any charitable or nonprofit corporation if deemed necessary and in the public interest by the auditor-general.

Source: SDC Supp 1960, § 55.2906 (1) as added by SL 1968, ch 205, § 2; SL 2003, ch 31, § 1.

4-11-3. Special audit of state accounts on Governor's order--Report of audit.

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 and a report shall likewise be made of such special audit, investigation, or examination and filed with the Governor and secretary of state and be subject to public inspection in the Office of Secretary of State.

Source: SL 1943, ch 258, § 6; SL 1953, ch 293; SDC Supp 1960, § 55.2906 (2).

4-11-4. Audit of municipal and county records--Frequency of examination--Federal guidelines--Annual report in lieu of audit.

The auditor-general shall cause audits as follows:

(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 auditor-general finds that special reasons exist.

Source: SL 1943, ch 258, § 6; SL 1953, ch 293; SL 1955, ch 249; SDC Supp 1960, § 55.2906 (4); SL 1966, ch 165, § 6; SL 1973, ch 36, § 1; SL 1976, ch 53, § 1; SL 1977, ch 73, § 1; SL 1982, ch 47; SL 1982, ch 48; SL 1985, ch 34, § 3; SL 1989, ch 46; SL 1991, ch 42, § 1; SL 1995, ch 28, § 3; SL 1996, ch 35.

4-11-4.1. Internal control review for certain municipalities.

The auditor general shall cause an internal control review to be performed in municipalities with less than six hundred thousand dollars in revenue at least once every five years if:

(1)    They are not required to have an entity-wide audit under § 4-11-4;

(2)    They have revenues of one hundred thousand dollars or more in any one year; and

(3)    They have not had an internal control review in the last five years.

The auditor general may cause an internal control review of any municipality with less than six hundred thousand dollars in revenue if it is requested by the governing body or he finds that special reason exists.

The auditor general shall develop the minimum procedures and reporting requirements for an internal control review. The governing body may require additional work to be performed as part of the internal control review contract.

The requirements for filing, publication and billing for services for an internal control review report shall be the same as that required for audits pursuant to chapter 4-11.

Source: SL 1991, ch 43, § 1.

4-11-5. Special audit of local accounts on request by governing body or taxpayers--Cost of examination.

The auditor-general is also authorized to make examinations of the books and accounts of the offices of all municipalities, townships, and school districts when called upon by the governing board of any such taxing district, or upon request by petition when signed by twenty percent of the resident taxpayers of such taxing district, as shown by the assessment roll of the preceding year, and payment of the cost of same shall be made by such subdivision upon bill rendered.

Source: SL 1943, ch 258, § 6; SL 1953, ch 293; SDC Supp 1960, § 55.2906 (5); SL 1966, ch 165, § 7.

4-11-6. Accounting manual for counties, municipalities, school districts, and their agencies.

The Department of Legislative Audit shall prepare and distribute an accounting manual for counties, municipalities, school districts, and their agencies and update such manual periodically.

Source: SL 1943, ch 258, § 6; SL 1953, ch 293; SDC Supp 1960, § 55.2906 (6); SL 1970, ch 33; SL 1971, ch 25; SL 1991, ch 44; SL 2011, ch 28, § 1.

4-11-7. Audit by private accountant--Acceptance in lieu of required audit.

Nothing contained in this chapter prevents a public corporation from employing a private accountant to examine and audit the books and accounts thereof or of any of its officers if the governing body or authorized official believes that the public interest requires it, and if such employment is first approved by the auditor-general. No private audit may be paid for before a copy thereof is filed with and approved by the auditor-general. The entity receiving audit services may approve progress payments proportionate to the audit work completed so long as ten percent of the amount billed is withheld pending approval by the auditor-general of the final report. The auditor-general may accept such audit in lieu of an examination otherwise required to be made by the auditor-general.

Source: SL 1943, ch 258, § 7; SDC Supp 1960, § 55.2907; SL 1966, ch 165, § 8; SL 1981, ch 32, § 1; SL 2011, ch 2, § 111.

4-11-7.1. School district audit by private auditing firm.

A school district shall have financial and compliance audits performed at least every two years. The audits shall be performed in accordance with generally accepted government auditing standards. The audits may be done by the Department of Legislative Audit or by a private auditing firm authorized by law to audit the financial records of school districts.

Source: SL 1995, ch 28, § 1.

4-11-7.2. Publication of school district audit results.

Not less than ten days after the date of filing the audit reports, the Department of Legislative Audit or the private auditing firm, whichever performed the audit, shall publish for two issues in each of the official papers of the school district a brief statement of the fact that the audit was made, where the audit may be found on file for public inspection, and a brief recital of the substantial items of error, irregularity, or loss which were discovered, but with enough detail so that the public is informed of the important findings of the audit. The Department of Legislative Audit or the private auditing firm, whichever made the audit, shall furnish a copy of the report of the audit to the person designated by the school board to receive the report. The designated person shall furnish a copy of the report of the audit to each member of the school board. The expense of the publication shall be paid at the legal rate by the school district.

Source: SL 1995, ch 28, § 2; SL 2018, ch 44, § 1.

4-11-8. Period of transactions covered by audit--Exceptions.

No examination or audit of the books and accounts of a public corporation shall 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.

Source: SL 1943, ch 258, § 5; SDC Supp 1960, § 55.2905.

4-11-9. Reports of audits--Place of filing.

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 Governor and the respective state agency. The auditor-general shall file reports of political subdivisions with the respective governing board and finance director.

Source: SL 1943, ch 258, § 8; SDC Supp 1960, § 55.2908; SL 1965, ch 244; SL 1966, ch 165, § 9; SL 1974, ch 55, § 7; SL 1995, ch 29.

4-11-10. Contents of audit reports.

The reports made under § 4-11-9 shall contain financial statements presented in accordance with generally accepted accounting principles or other accepted methods of reporting of such subdivision, department, commission, agency, or institution, and such other general information as may be deemed necessary by the auditor or required by such subdivision, department, commission, agency, or institution.

Source: SL 1943, ch 258, § 8; SDC Supp 1960, § 55.2908; SL 1965, ch 244; SL 1966, ch 165, § 9; SL 1985, ch 34, § 4.

4-11-11. Filing of audit reports--Open to public inspection.

The auditor-general shall at all times keep on file in his office the original copy and such additional copies as may be deemed necessary of any report of investigations, audits, or examinations made by his 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 any of the public offices.

Source: SL 1943, ch 258, § 8; SDC Supp 1960, § 55.2908; SL 1965, ch 244; SL 1966, ch 165, § 9; SL 1985, ch 34, § 5.

4-11-12. Publication of notice of county, municipal and school district audit reports--Contents and expense of notice.

Not less than ten days after the date of filing the reports on audit in any public office the auditor-general shall cause to be published for two issues in each of the official papers of any municipality, school district or county, the audit of which has been completed, a brief statement of the fact that he has made the audit and where the same may be found on file for public inspection and also a brief recital of the substantial items of error, irregularity, or loss which he has discovered but with sufficient detail so that the public may be informed of the important findings of the audit. Expense of such publication is to be paid at legal rate by the said municipality, school district, or county. Any county, city, or school district who receives an independent audit shall make the audit report available on the entity's website.

Source: SL 1943, ch 258, § 8; SDC Supp 1960, § 55.2908; SL 1965, ch 244; SL 1966, ch 165, § 9; SL 1971, ch 26; SL 1992, ch 60, § 2; SL 2018, ch 44, § 2.

4-11-13. Copies of audit reports received in evidence.

A copy of any record or report in the office of the Department of Legislative Audit, certified to by the auditor-general under his seal and attested by the secretary of state with the great seal of the state affixed thereto, shall be received in evidence in all courts of this state with the same effect as the original thereof and without further authentication.

Source: SL 1943, ch 258, § 8; SDC Supp 1960, § 55.2908; SL 1965, ch 244; SL 1966, ch 165, § 9.

4-11-14. Civil action to recover misappropriated funds disclosed by audit report.

If any report provided herein discloses malfeasance, misfeasance, or neglect of duty on the part of an 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 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.

Source: SL 1943, ch 258, § 9; SDC Supp 1960, § 55.2909.

4-11-15. Notice to attorney general of civil actions--Compromise of actions.

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 board of county commissioners or board of other taxing district to 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 any court to enter any compromise or settlement of such civil action, without giving notice thereof to the attorney general and allowing him to be heard in the matter.

Source: SL 1943, ch 258, § 9; SDC Supp 1960, § 55.2909.

4-11-16. Attorney general to oversee or institute civil actions--Criminal prosecutions not affected.

It shall be the duty of the Governor and of the attorney general to see 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 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 or prejudice any criminal actions or prosecutions which may be applicable.

Source: SL 1943, ch 258, § 9; SDC Supp 1960, § 55.2909.

4-11-17. Attorney general to assist and supervise prosecutions.

It shall be the duty of the attorney general, when called upon by the auditor-general, to aid in any investigation or matter needing legal advice or inquiry, and to supervise the prosecution of all offenders under the laws relating thereto.

Source: SL 1887, ch 124, § 10; CL 1887, § 126; RPolC 1903, § 103; RC 1919, § 5368; SDC 1939, § 55.1504.

4-11-18. Costs of audits charged to state agencies and local bodies--Computation--Witness fees and expenses--Collection of claims.

For each audit made of any agency of state government, except those agencies or that portion of an agency that is financed with state general fund appropriations, the audited agency shall pay for audit services computed by dividing the estimated total expenses of the department of legislative audit relating to state government audits for the current fiscal year by the estimated number of audit hours to be spent performing state government audits during the same year and the result multiplied by the number of hours spent on the particular audit. For audits of state agencies if more than one fund is involved, the auditor-general shall determine the method of allocating audit costs. For each audit made of any county, municipality, school district, special district, or other local government agency, the audited agency shall pay for audit services computed by dividing the estimated total expenses of the Department of Legislative Audit relating to local government audits for the current fiscal year by the estimated number of audit and travel hours to be spent performing local government audits during the same year and the result multiplied by the number of hours spent on the particular audit. In all cases where the auditor-general, assistant, or employee is subpoenaed as a witness for a county or other public corporation in the prosecution of its officers reported on by the department, the county, or such other public corporation shall pay all witness fees and all expenses of serving subpoenas and attachment for witness and all expenses for procuring testimony, including the necessary expenses of such witness. All claims for services and expense of the auditor-general or assistants against such county or other public corporation shall be prepared in favor of the state treasurer in payment thereof at the first regular or special meeting of the governing board after the audit is completed. Upon the neglect or refusal of the governing board to issue a warrant in payment of the claim as herein provided, interest at the Category A rate of interest as established in § 54-3-16 shall be added for the time the same remains unpaid after the date of such meeting.

Source: SL 1943, ch 258, § 11; SDC Supp 1960, § 55.2911; SL 1963, ch 312; SL 1966, ch 165, § 11; SL 1968, ch 205, § 3; SL 1969, ch 213; SL 1972, ch 27, § 1; SL 1976, ch 54, § 1; SL 1978, ch 40; SL 1983, ch 28, § 3; SL 1984, ch 319, § 4; SL 1991, ch 45.

4-11-19. Deposit and crediting of reimbursed amounts.

All funds coming into the hands of the auditor-general or state treasurer for him shall be deposited with the state treasurer and placed in the state general fund.

Source: SL 1943, ch 258, § 12; SL 1955, ch 250; SDC Supp 1960, § 55.2912; SL 1966, ch 165, § 12; SL 1972, ch 27, § 2.

4-11-20. Audit of vouchers, claims, and accounts of Department of Legislative Audit.

All salary and expense vouchers of the Department of Legislative Audit shall be audited and passed upon by the state auditor, who shall have the same power respecting such vouchers and claims as is herein conferred upon the auditor-general as to all other state departments, agencies, commissions, and institutions. The state auditor is authorized to make an examination and audit of the Department of Legislative Audit accounts whenever he deems it necessary.

Source: SL 1943, ch 258, § 13; SDC Supp 1960, § 55.2913.

4-11-21. Confidential identity of person supplying information to department.

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 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 law enforcement officers of any municipality, county, state, or federal agency or department for such information.

Source: SL 1994, ch 45.