45 KAR 1:050. Audits of fiscal courts

      Section 1. Definition. "Generally accepted government auditing standards" means the "Government Auditing Standards" issued by the Comptroller General of the United States.

 

      Section 2. Auditing Standards, Procedures and Formats. The financial and compliance audit of the funds contained in each county's budget shall be conducted in accordance with:

      (1) Auditing standards generally accepted in the United States of America, referenced in 201 KAR 1:300, Section 5(1)(a);

      (2) Generally accepted government auditing standards, referenced in 201 KAR 1:300, Section 5(1)(b); and

      (3) "Audit Guide for Fiscal Court Audits," issued by the Auditor of Public Accounts, September 15, 2004.

 

      Section 3. Auditor's Independent Judgement. The requirements of this administrative regulation shall not be interpreted in a manner that restricts the independent judgment of a certified public accountant or the Auditor of Public Accounts.

 

      Section 4. Audit Objective. (1) The primary objective of an audit of a fiscal court shall be an audit report that provides an opinion on whether the financial statements of a fiscal court present fairly, in all material respects, the:

      (a) Financial position of the governmental activities, business type activities, aggregate discretely presented component units, each major fund and the aggregate remaining fund information; and

      (b) Changes in financial position and cash flows.

      (2) Any audit report of a fiscal court that is required to comply with the requirements of the Single Audit Act of 1984, the Single Audit Act Amendments of 1996, and OMB Circular A-133, "Audits of States, Local Governments, and Non-Profit Organizations," shall include a statement concerning whether:

      (a) The Schedule of Expenditure of Federal Awards is fairly stated, in all material respects, in relation to the financial statements taken as a whole: and

      (b) The fiscal court has complied, in all material respects, with the requirements applicable to each of its major federal programs.

      (3) An auditor shall make tests sufficient to determine whether:

      (a) The fiscal court has complied with the requirements of the uniform system of accounts adopted under KRS 68.210;

      (b) Receipts have been accurately recorded by source;

      (c) Expenditures have been accurately recorded by payee; and

      (d) The county has complied with all other legal requirements relating to the management of public funds.

 

      Section 5. Allowance of Audit Fees; Acceptance of Report. (1) Fees for county fiscal court audits shall be allowable as reasonable and necessary expenses of a county if the independent accountant's examination has been performed and reported in compliance with the standards, procedures, and formats promulgated by this administrative regulation.

      (2) A county shall obtain written approval of an audit report from the Auditor of Public Accounts prior to the:

      (a) Release of an audit report; and

      (b) Payment of fees for a fiscal court audit.

      (3) Failure by an independent certified public accountant to comply with the "Audit Guide for Fiscal Court Audits" and this administrative regulation shall disqualify him from conducting fiscal court audits.

 

      Section 6. Incorporation by Reference. (1) The "Audit Guide for Fiscal Court Audits", Auditor of Public Accounts, September 15, 2006, is incorporated by reference.

      (2) This document may be inspected, copied, or obtained, subject to applicable copyright law, at the office of the Auditor of Public Accounts, 105 Sea Hero Road Suite 2, Frankfort, Kentucky 40601, Monday through Friday, 8 a.m. to 4:30 p.m. (18 Ky.R. 1695; Am. 2197; eff.1-10-1992; 22 Ky.R. 1329; eff. 3-7-96; 31 Ky.R. 1052; eff. 1-4-2005; 33 Ky.R. 1425; 1789; eff. 2-2-07.)

Notation

      RELATES TO: KRS 43.070, 43.075, 64.810, 68.210, 31 U.S.C. 7501-7507

      STATUTORY AUTHORITY: KRS 43.075

      NECESSITY, FUNCTION, AND CONFORMITY: KRS 43.075 requires the Auditor of Public Accounts to promulgate administrative regulations developing uniform standards and procedures for conducting, and uniform formats for reporting, audits of the funds contained in counties, budgets (fiscal courts). This administrative regulation establishes the auditing standards, procedures, and formats for fiscal court audits.