# Title 54 — State Government

## Chapter 54-10 — State Auditor

### § 54-10-01. Powers and duties of state auditor - Report.

(Retroactive application -
See note )
1. The state auditor shall:
a. Be vested with the duties, powers, and responsibilities involved in performing the
postaudit of all financial transactions of state government, detecting and reporting
any defaults, and determining that expenditures have been made in accordance
with law and appropriation acts.
b. Perform or provide for the audit of the general purpose financial statements and a
review of the material included in the annual comprehensive financial report of
the state in accordance with government auditing standards.
c. Except for the audit of the department of financial institutions as outlined in
section 54-10-31, perform or provide for audits of state agencies in accordance
with government auditing standards and legislative audit and fiscal review
committee guidelines developed under section 54-35-02.10. Except for the
annual audit of the North Dakota lottery required by section 53-12.1-03, the state
auditor shall audit each state agency once every two to four years. Audits may be
conducted at more frequent intervals if requested by the governor or the
legislative audit and fiscal review committee.
d. Except for the audit of the department of financial institutions as outlined in
section 54-10-31, perform or provide for performance audits of state agencies, or
the agencies' blended component units or discreetly presented component units,
as determined necessary by the legislative assembly, or the legislative audit and
fiscal review committee if the legislative assembly is not in session. When
determining the necessity of a performance audit, the legislative audit and fiscal
review committee shall consider:
(1) The potential cost-savings or efficiencies that may be gained as a result of
the performance audit;
(2) The staff resources of the state auditor's office and of the state agency
being audited which will be required to conduct the audit;
(3) The potential for discovery of noncompliance with state law or legislative
intent regarding the program or agency; and
(4) The potential for the performance audit to identify opportunities for program
improvements.
e. Report quarterly to the legislative audit and fiscal review committee regarding:
(1) Communication processes with audited entities and any changes to the
processes;
(2) Billing practices and procedures, including the use of cost estimates for
audits, an itemized invoicing methodology, and a defined change order
process for audits that exceed the original estimate;
(3) Information on audits completed, including:
(a) Name of the audited organization;
(b) Organization type;
(c) Audit type;
(d) Audit period;
(e) Estimated and actual hours and costs; and
(f) Total audit cost and the total cost as a percentage of the audited
organization's operating budget; and
(4) Audit schedules, including audits performed by private firms and audits
performed by the state auditor's office.
f. Report on the functions of the state auditor's office to the governor and the
secretary of state in accordance with section 54-06-04 or more often as
circumstances may require.

g. Perform work on mineral royalties for the federal government in accordance with
section 1735(a) of the Mineral Lands and Mining Act [30 U.S.C. 1735 et seq.].
h. Report to the legislative audit and fiscal review committee regarding final report
distribution policies and practices and any final audit reports released to the
public prior to distribution of the final audit report to all individuals charged with
the governance of the audit client.
i. Perform all other duties as prescribed by law.
2. The state auditor may:
a. Conduct any work required by the federal government and charge an amount
equal to the cost of the audit to be paid by the audited federal funds of the
appropriate government agency and deposited into the general fund.
b. Within the resources available to the state auditor, perform or provide for
performance audits of state agencies as determined necessary by the state
auditor.
c. Audit the International Peace Garden at the request of the board of directors of
the International Peace Garden.
d. Contract with a private certified public accountant or other qualified professional
to conduct or assist with an audit, review, or other work the state auditor is
authorized to perform or provide for under this section. Before entering any
contract, the state auditor shall present information to the legislative audit and
fiscal review committee on the need for the contract and its estimated cost and
duration. Except for performance audits conducted under subdivision d of
subsection 1 or subdivision b of this subsection and except for audits of
occupational or professional boards, the state auditor shall execute the contract
and any executive branch agency, including higher education institutions, shall
pay the fees of the contractor. For performance audits conducted under
subdivision d of subsection 1 or subdivision b of this subsection, the state auditor
may charge a state agency for the cost of a contract relating to an audit, subject
to approval by the legislative assembly or the legislative audit and fiscal review
committee if the legislative assembly is not in session. When considering a
request, the legislative audit and fiscal review committee shall consider the effect
of the audit cost on the agency being audited, the necessity of the contract, and
the potential benefit to the state resulting from the contract. The state auditor
shall notify the affected agency of the potential cost before requesting approval
from the legislative assembly or the legislative audit and fiscal review committee.
3. Notwithstanding subdivision c of subsection 1 and subdivision d of subsection 2, the
state auditor may not charge audit fees to an institution of higher education, agency, or
office under the control of the state board of higher education, including passthrough
grants, except for a proportional share of audit fees on federal programs or grants to
the extent those audited federal programs or grants provide for allowable cost
recovery. Institutions without an approved indirect cost recovery fund may not be
assessed audit fees on closed federal programs.
### § 54-10-01.1. State auditor to audit emergency commission action.

The state auditor's office, in the course of its audits of state agencies, departments, and
institutions, shall review the expenditure of funds transferred or made available by the
emergency commission to such state agencies, departments, and institutions, and shall have
incorporated in the financial statements of such governmental units expenditures arising from
emergency commission action.
### § 54-10-02. Auditor to have access to all state offices.

Except for active investigatory work product of the attorney general as defined in section
44-04-19.1, the state auditor shall have access to all state offices during business hours for the
purpose of inspecting books, papers, accounts, and records therein as may concern the state
auditor's duties. Except for active investigatory work product of the attorney general as defined
in section 44-04-19.1 and tax records as described in section 54-10-24, access includes

inspection of any books, papers, accounts, or records that the state auditor may deem relevant
to an ongoing audit of any other state agency or computer system audit.
### § 54-10-03. Official bond.

Repealed by S.L. 1999, ch. 113, § 24.
### § 54-10-04. Legislative assembly to provide for audit of state auditor's office.

The legislative assembly shall provide for the employment by contract of a public
accountant or accountants to conduct a postaudit of the office of the state auditor. A copy of
such audit report must be filed with the governor and with each house of the legislative
assembly.
### § 54-10-05. Auditor to set up account against person who fails to render account.

Repealed by S.L. 1959, ch. 372, § 117.
### § 54-10-06. Auditor may procure books and blanks.

Repealed by S.L. 1959, ch. 372, § 117.
### § 54-10-07. Auditor to have access to all state offices.

Repealed by S.L. 1959, ch. 372, § 117.
### § 54-10-08. Legislative inspection of books of state auditor.

Repealed by S.L. 1959, ch. 372, § 117.
### § 54-10-09. Transmit forms and instructions to county auditors.

Repealed by S.L. 1959, ch. 372, § 117.
### § 54-10-10. Salary of state auditor.

The annual salary of the state auditor is one hundred thirty-nine thousand two hundred
fifty-six dollars through June 30, 2026, and one hundred forty-three thousand four hundred
thirty-four dollars thereafter.
### § 54-10-11. Official bond.

Repealed by S.L. 1959, ch. 372, § 117.
### § 54-10-12. Department of transportation property.

Repealed by S.L. 2001, ch. 122, § 11.
### § 54-10-13. Political subdivisions - Audits - State auditor powers.

The state auditor shall perform audits of political subdivisions pursuant to section 54-10-14
unless otherwise requested by the governing board, ordered by the governor or the legislative
audit and fiscal review committee, or on petition pursuant to section 54-10-15, or at the
discretion of the state auditor for alleged improprieties.
### § 54-10-14. Political subdivisions - Audits - Fees - Alternative audits and reports.

1. The state auditor shall audit the following political subdivisions once every two years,
except as provided in this section or otherwise by law:
a. Counties.
b. Cities, and when a city is audited, to include any political subdivision that was
created by the city and has bonding authority.
c. Park districts.
d. School districts.
e. Firefighters relief associations.
f. Airport authorities.

g. Public libraries.
h. Water resource districts, created under chapter 61-16 and operating under
chapter 61-16.1.
i. Garrison Diversion Conservancy District.
j. Rural fire protection districts.
k. Special education districts.
l. Area career and technology centers.
m. Correction centers.
n. Recreation service districts.
o. Weed boards.
p. Irrigation districts.
q. Rural ambulance service districts.
r. Southwest water authority.
s. Regional planning councils.
t. Soil conservation districts.
u. Western area water supply authority industrial water sales on an annual basis.
v. Water districts subject to chapter 61-35.
2. The state auditor shall charge the political subdivision an amount equal to the fair
value of the audit and any other services rendered. The fees must be deposited in the
state auditor operating account. The state treasurer shall credit the state auditor
operating account with the amount of interest earnings attributable to the deposits in
that account. Expenses relating to political subdivision audits must be paid from the
state auditor operating account, within the limits of legislative appropriation.
3. In lieu of conducting an audit every two years, the state auditor may require annual
reports from political subdivisions subject to this section, or otherwise provided by law,
for any report delinquent as of June 30, 2023, or from political subdivisions with less
than two million dollars of annual receipts, excluding any funds passed through the
political subdivision to another entity. If any federal agency performs or requires an
audit of a political subdivision that receives federal funds to pass through to another
entity, the political subdivision shall provide a copy to the state auditor upon request by
the state auditor. The reports must contain the financial information required by the
state auditor. The state auditor may:
a. Make any additional examination or audit determined necessary in addition to the
annual report.
b. Charge the political subdivision an amount equal to the fair value of the additional
examination or audit and any other services rendered.
c. Charge a political subdivision a fee not to exceed ninety dollars an hour for the
costs of reviewing the annual report.
4. A political subdivision, at the option of its governing body, may be audited by a certified
public accountant or licensed public accountant rather than by the state auditor. The
public accountant annually shall register with the state auditor and comply with
generally accepted government auditing standards for audits of political subdivisions.
The report must be in the form and content required by the state auditor. The number
of copies of the audit report requested by the state auditor must be filed with the state
auditor when the public accountant delivers the audit report to the political subdivision.
The state auditor shall review the audit report to determine if the report is in the
required form and has the required content, and if the audit meets generally accepted
government auditing standards. The state auditor also may periodically review the
public accountant's workpapers to determine if the audit meets generally accepted
government auditing standards. If the report is in the required form and has the
required content, and the report and workpapers comply with generally accepted
government auditing standards, the state auditor shall accept the audit report. The
state auditor may charge the political subdivision a fee of up to ninety dollars an hour,
but not to exceed seven hundred fifty dollars per review, for the related costs of
reviewing the audit report and workpapers.

5. A political subdivision may not pay a public accountant for an audit until the state
auditor has accepted the audit. However, a political subdivision may make progress
payments to the public accountant. A political subdivision shall retain five percent of
any progress payment until the audit report is accepted by the state auditor.
6. The state auditor may require the correction of any irregularities, objectionable
accounting procedures, or illegal actions on the part of the governing board, officers,
or employees of the political subdivision disclosed by the audit report or workpapers,
and failure to make the corrections must result in audits being resumed by the state
auditor until the irregularities, objectionable accounting procedures, or illegal actions
are corrected.
### § 54-10-15. Audits of political subdivisions by request of governor or order of the

legislative audit and fiscal review committee, upon petition, or upon request of the state
court administrator.
1. The state auditor, by duly appointed deputy auditors or other authorized agents, shall
audit or review the books, records, and financial accounts of any political subdivision
when ordered by the legislative audit and fiscal review committee. The state auditor, by
duly appointed auditors or other authorized agents, may audit or review the books,
records, and financial accounts of any political subdivisions when requested by the
governor, requested by the governing board, or upon petition of at least thirty-five
percent of the qualified electors of any political subdivision enumerated in section
school districts, upon petition of at least thirty-five percent of the qualified electors
voting at the preceding school board election regarding water districts subject to
chapter 61-35, upon a petition of at least ten percent or three hundred participating
members, whichever is fewer, or upon the request of the state court administrator with
respect to clerk of district court services provided by a county in accordance with
chapter 27-05.2. Fees for the audits must be paid in accordance with the provisions of
section 54-10-14.
2. If an audit is ordered due to financial irregularities or allegations of embezzlement, the
governor may suspend an elected or appointed school board member from the
individual's duties if the governor determines suspension is in the best interest of the
state pending the results of the audit. If the governor suspends an elected or
appointed school board member, the governor immediately shall provide notice to the
school board with which the suspended member serves. Within five days of receiving
notice, the school board shall appoint an individual to replace the suspended member
to serve during the pendency of the audit. The governor shall consult with the
superintendent of public instruction in determining whether suspension of a member of
a school board is in the best interest of the state.
### § 54-10-16. Audit in case of irregularity or embezzlement.

It is not the duty of the state auditor or the state auditor's staff to make audits of any political
subdivisions, funds, commissions, associations, and bureaus, for the reason of severance from
the service of such political subdivisions, funds, commissions, associations, and bureaus of any
officer, clerk, deputy, cashier, or other employee unless the head of such state office or
department, or the board administering any other of the agencies named herein shall request
such audit in writing, and state that there is reason to believe that there is irregularity in handling
funds or embezzlement involved.
### § 54-10-17. Audit of counties.

Repealed by S.L. 2005, ch. 480, § 1.
### § 54-10-18. Supervision of records and fiscal affairs of counties.

Repealed by S.L. 2009, ch. 463, § 3.

### § 54-10-19. Supervision of public institutions and private institutions with which state

has dealings.
The state auditor may examine the books and accounts of all private institutions with which
the state has any dealings so far only as the same relate to such dealings. If any public officer
having control of any such office or institutions fails or refuses to comply with the directions of
the state auditor, the auditor shall report the facts to the governor and to the manager of the
state bonding fund, and such refusal constitutes grounds for removal from office and
cancellation of the bond of such officer.
### § 54-10-20. Special state auditor.

Repealed by S.L. 2021, ch. 396, § 1.
### § 54-10-21. Duty of state auditor on failures by officers.

The state auditor may report to the attorney general the refusal or neglect of any state
officer to obey the state auditor's recommendations. After investigation, the attorney general
may take appropriate action to enforce compliance therewith.
### § 54-10-22. Public officers to aid state auditor - Auditor's authority on investigation -

Referral of open records request.
1. The officers and employees of all departments, institutions, boards, commissions, and
political subdivisions, subject to examination by the state auditor, shall afford all
reasonable facilities for the investigation provided for in this title and shall make
returns and exhibits to the auditor under oath in a form and manner as the auditor may
prescribe.
2. The auditor shall have full power and authority to audit any books, papers, accounts,
bills, vouchers, and other documents or property of any and all departments, boards,
commissions, political subdivisions, and financial institutions subject to the auditor's
audit. The auditor shall have authority to audit under oath any or all trustees,
managers, officers, employees, or agents of any such departments, boards,
commissions, or political subdivisions. When necessary, the auditor shall employ
stenographers or clerical help, the expense incurred to be collected by the auditor from
the respective department, institution, board, commission, or political subdivision.
3. If the auditor receives a request for access to or inspection of information submitted to
the auditor by a department, institution, board, commission, or political subdivision, the
auditor shall refer the request to the submitting department, institution, board,
commission, or political subdivision for response. The referral of a request under this
subsection satisfies the responsibility of the auditor to respond to a request for public
records under chapter 44-04.
### § 54-10-22.1. State auditor's access to information relating to operations of

governmental entities subject to audit.
Notwithstanding any other specific sections of law, the state auditor and persons employed
by the state auditor, when necessary in conducting an audit, shall have access to all information
relating to operations of all governmental units or component units subject to audit except active
investigatory work product of the attorney general as defined in section 44-04-19.1 and financial
records and estate planning records a donor provides to a nonprofit organization affiliated with
an institution under the control of the state board of higher education which provides support to
and is organized and operated for the benefit of the institution. Except for active investigatory
work product of the attorney general as defined in section 44-04-19.1, tax records as described
in section 54-10-24, and all facts and information obtained or created by the department of
financial institutions under subsection 1 of section 6-01-07.1, the state auditor may inspect any
state agency's books, papers, accounts, or records that may be relevant to an ongoing audit of
any other state agency or computer system audit. The state auditor and persons employed by
the state auditor examining any information, which is confidential by law, shall guard the secrecy

of such information except when otherwise directed by judicial order or as is otherwise provided
by law.
### § 54-10-23. Obstructing or misleading auditor - Penalty.

Every person who, when required to do so, shall refuse or neglect to make any return or
exhibit, or to make or give any information required by the auditor, or who willfully shall obstruct
or mislead the auditor in the execution of the auditor's duties, or who in any manner shall hinder
a thorough examination by the auditor, is guilty of a class C felony.
### § 54-10-24. The state auditor shall have access to tax returns and other records filed

with the tax commissioner.
The state auditor and persons employed by the state auditor, when necessary in conducting
an audit and examination of the books and records of the tax commissioner as authorized by
law, may examine any return, report, or other information filed with the tax commissioner, and
confirm the authenticity of such return, report, or other information with the taxpayer who filed it.
The audit report of the state auditor may not identify any return, report, or other document
examined whose secrecy is guarded by law and which is examined pursuant to this chapter by
the state auditor or the auditor's representatives, but the state auditor or the auditor's
representatives shall make a listing of each return, report, or other document examined whose
secrecy is guarded by law, which listing must include the name and address of the taxpayer or
other person who filed the return, report, or other document or to whom it relates, and the tax
department file identification number for it; such listing must also identify all summaries and
schedules examined which are compiled and kept by the tax commissioner and which identify
taxpayers and taxpayer information to which the secrecy requirements apply; the listing must
also show the name or names of the individuals representing the state auditor who examined
each such return, report, summary, schedule, or other document. A copy of the listing must be
filed by the state auditor with the tax commissioner. Such listing and all copies thereof are
subject to the same secrecy or confidentiality requirements that apply to the information
described in the listing.
### § 54-10-25. Divulging of certain secret information prohibited.

1. The state auditor and the auditor's employees, including any person employed by the
auditor to perform the examination of any return, report, or other information filed and
in the possession of the tax commissioner which is made confidential by law, may not
divulge the contents of any return, report, or other information examined or any listing
made therefrom by the state auditor or the auditor's employees except when otherwise
directed by judicial order, or as is otherwise provided by law.
2. The state auditor, the auditor's employees, or an agent of the auditor may not divulge
any information relating to a matter forwarded to the attorney general or a state's
attorney for further investigation until the attorney general or state's attorney has made
a determination as to whether there is probable cause to believe a violation of law has
occurred.
### § 54-10-25.1. Reporting noncompliance - Confidentiality.

Information that reasonably may be used to identify an individual who reported suspected or
potential violations of law or other irregularities to the state auditor is a confidential record under
section 44-04-17.1.
### § 54-10-26. State auditor's working papers.

1. Except as provided in this section, working papers of the state auditor are not public
records and are exempt from section 44-04-18. Working papers include records kept
by the auditor of the procedures applied, the tests performed, the information obtained,
draft audit reports, and the pertinent conclusions reached in the engagement. Working
papers may be, at the discretion of the state auditor and unless otherwise prohibited
by law, made available for inspection.

2. Except as provided in subsection 3, a draft audit report released to the governing body
or management of the audited entity is confidential until the final audit report is issued
or work ceases on the audit at which time the audit report becomes an open record.
3. Except as provided in this subsection, a draft audit report for an audit completed in
accordance with performance auditing standards contained in government auditing
standards issued by the comptroller general of the United States to provide an
independent assessment of the performance and management of a program released
to the governing body or management of the audited entity is confidential until the final
version of the audit report is an open record. After the auditor receives the audited
entity's response to the draft report, the auditor shall complete the audit report, which
is then deemed a preliminary audit report. The auditor shall provide the preliminary
audit report and the audited entity's response to the legislative audit and fiscal review
committee for a seven-day review period, except the auditor may not provide any
information that is confidential under subsection 2 of section 54-10-25. During the
review period, the preliminary audit report and the response may not be provided to
any other person except by the legislative audit and fiscal review committee as
necessary to perform the committee's duties as described in section 54-35-02.2. At the
end of the review period, the preliminary audit report is deemed a final audit report,
and the final audit report and the audited entity's response are open records. Reports
for audits performed under subdivision f of subsection 1 of section 54-10-01 or
subdivision a of subsection 2 of section 54-10-01 are not subject to this subsection.
4. The respective working papers of an issued audit report or an audit report presented to
the legislative audit and fiscal review committee are open records unless the state
auditor declares all or a portion of the working papers confidential. The declaration of
confidentiality must state the reason for the confidentiality and the date, as can best be
reasonably determined at the time, when the working papers will be made public.
### § 54-10-27. Occupational and professional boards - Audits and reports.

The governing board of any occupational or professional board shall provide for an audit
once every two years by a certified public accountant or licensed public accountant. The
accountant conducting the audit shall submit the audit report to the state auditor's office. If the
report is in the form and style prescribed by the state auditor, the state auditor may not audit that
board. An occupational or professional board may request the state auditor to conduct its audit,
and if the state auditor agrees to conduct the audit, the state auditor shall deposit the fees
charged to the occupational or professional board into the state auditor operating account.
Instead of providing for an audit every two years, an occupational or professional board that has
less than two million dollars of annual receipts may submit an annual report to the state auditor.
The report must contain the information required by the state auditor. The state auditor also may
make any additional examination or audit determined necessary in addition to the annual report.
When a report is not filed, the state auditor may charge the occupational or professional board
an amount equal to the fair value of the additional examination or audit and any other services
rendered. The state auditor may charge an occupational or professional board a fee not to
exceed ninety dollars an hour for the costs of reviewing the annual report.
### § 54-10-28. Information technology responsibilities.

The state auditor may:
1. Conduct information technology compliance reviews, as determined necessary by the
information technology committee, by conducting individual agency audits of
information technology management, information technology planning, compliance
with information technology plans, and compliance with information technology
standards and policies and conducting statewide agency audits of compliance with
specific information technology standards and policies.
2. Consult with the information technology department on audits of compliance with
information technology plans and compliance with information technology standards
and policies.

3. Participate in the information technology department's enterprise architecture process
for developing information technology standards and policies.
4. Monitor major information technology projects for compliance with project
management and information technology standards and policies.
5. Present results of information technology compliance reviews to the information
technology committee.
### § 54-10-29. Audits of computer systems - Penalty.

1. The state auditor may:
a. Pursuant to the powers and duties outlined in this chapter, conduct a review and
assessment of computer systems and related security systems. Computer
systems subject to this section include the computer systems of a state agency or
political subdivision that is subject to audit by the state auditor. Tests conducted in
connection with this review and assessment may include an assessment of
system vulnerability, network penetration, potential security breach, and
susceptibility to cyber attack or cyber fraud.
b. Disclose any findings to the chief information officer of the state or to any state
official or legislative committee. Working papers and preliminary drafts of reports
created in connection with the review of computer systems and the security of the
systems are exempt from section 44-04-18. Those parts of findings and working
papers that identify the methods of the state auditor or that may cause or
perpetuate vulnerability of the computer system reviewed are exempt from
section 44-04-18 and protected from disclosure until the state auditor directs
otherwise.
c. Procure the services of a specialist in information security systems or other
contractors deemed necessary in conducting a review under this section. The
procurement of these services is exempt from the requirements of chapter
54-44.4.
2. An outside contractor hired to provide services in the review of the security of a
computer system is subject to the confidentiality provisions of this section and section
### § 44-04-27. Any individual who knowingly discloses confidential information is subject to

the provisions of section 12.1-13-01.
3. The state auditor shall notify the executive officer of any state agency of the date, time,
and location of any test conducted in connection with a review and assessment of
computer systems or related security systems. The executive officer or the officer's
designee may attend and observe any test during which confidential information may
be accessed or controlled.
4. The state auditor shall notify the attorney general of the date, time, and location of any
test conducted in connection with a review and assessment of computer systems or
related security systems. The attorney general may designate an individual to
participate in the test. The designee of the attorney general may order the test to be
terminated if the individual believes a sensitive system is being breached, a sensitive
system may be breached, or sensitive information may be revealed.
5. Notwithstanding any provision in chapter 32-12.2 to the contrary, if the attorney
general and the director of the office of management and budget determine it is in the
best interest of the state, the state auditor may agree to limit the liability of a contractor
performing a review and assessment under this section. The liability limitation must be
approved by the attorney general and director of the office of management and budget
in writing. For any uninsured losses, the director of the office of management and
budget may approve the risk management fund to assume all or part of the
contractor's liability to the state in excess of the limitation.
6. A state agency receiving federal tax information under section 6103 of the Internal
Revenue Code, as amended [26 U.S.C. 6103], in conjunction with the state auditor,
may enter a contract with the vendor selected by the state auditor under subdivision c
of subsection 1 to conduct a review and assessment of the state agency's computer
systems and related security systems, including an assessment of system

vulnerability, network penetration, potential security breach, and susceptibility to cyber
attack or cyber fraud.
### § 54-10-30. State board of higher education audits - Higher education audit division.

1. The state auditor shall establish a higher education audit division and employ a
division audit manager to perform all audit related functions of the state board of
higher education, including the examination and evaluation of the adequacy and
effectiveness of the board's governance, risk management, internal controls,
performance of constitutionally and statutorily required duties, and other areas as
determined by the state auditor. The audit manager shall conduct audits, as
determined appropriate by the state auditor, of each institution under the supervision
and control of the state board of higher education. The audit manager may consult
with the state board of higher education, or a committee designated by the board,
regarding audit plans, results of audit activities, and any other appropriate issue. The
state auditor shall determine the audit scope and related audit areas of any audit
conducted by the audit manager. This section does not require the state auditor to
perform any duties that would compromise the auditor's independence under
government auditing standards.
2. The audit manager may access and examine any record under the control of the state
board of higher education. For purposes of reviewing records under the Family
Educational Rights and Privacy Act [20 U.S.C. 1232g; 34 CFR 99] or any other federal
privacy law, the audit manager must be considered a state educational official
authorized to access student records for audit purposes.
3. The state auditor may hire employees necessary to carry out the duties and
responsibilities of this section. The state auditor may hire consultants to assist with any
duties required under this section subject to approval by the legislative audit and fiscal
review committee. The state board of higher education shall pay for the cost of any
consultant approved under this section.
4. This section does not prohibit the state board of higher education from employing
internal audit staff or contracting for internal audit services.
### § 54-10-31. Department of financial institutions - Audit and reports.

Once every two years, the state banking board shall provide for an audit of the department
of financial institutions by a certified public accountant. The state banking board may request
the state auditor to conduct the audit. If the state auditor agrees to conduct the audit, the state
auditor shall deposit any fees assessed for completion of the audit to the state auditor operating
account.
