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SB 2251

AN ACT to amend and reenact section 54-10-01, subsection 5 of section 54-10-14, and sections 54-10-22 and 54-10-27 of the North Dakota Century Code, relating to audits conducted by the state auditor and charges for audits.

69th Legislative Assembly (2025-26) Introduced by Jose Castaneda and 5 co-sponsors

ND SB 2251 updates the State Auditor's powers, audit charges, and subpoenas; fixes agricultural-group audit fees and requires quarterly reporting and use of private CPAs.

Filed with Secretary Of State 04/22
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Bill Summary · SB 2251

SB 2251 — Summary (North Dakota)

Status: Filed with Secretary of State 04/22/2025
Introduced: March 11, 2025
Subject: Amendments to audit law — state auditor powers, audit charges, and subpoenas (NDCC sections amended: 54-10-01; subsection 5 of 54-10-14; sections 54-10-19 and 54-10-27)

Purpose / Intent

The bill updates statutory authority and administrative practice for the State Auditor’s office. Its aims are to (1) clarify and restate the auditor’s powers and duties related to financial and performance audits, (2) specify charging and billing practices for audits, (3) set fixed audit fees for certain agricultural commodity groups, and (4) amend subpoena-related provisions used by the State Auditor.

Key provisions and changes

  • Reenacts and amends NDCC 54-10-01 (powers and duties of the State Auditor). Major elements:

    • Reaffirms postaudit responsibility for state financial transactions and requirement to audit state general-purpose financial statements and the CAFR in accordance with government auditing standards.
    • Requires the State Auditor to audit each state agency on a two- to four‑year cycle (except certain statutorily-exempt audits).
    • Authorizes performance audits when determined necessary by the Legislative Assembly or the Legislative Audit & Fiscal Review Committee; lists factors the committee must consider (cost savings, staff resources, compliance risk, program improvement potential).
    • Requires quarterly reporting to the Legislative Audit & Fiscal Review Committee on communication processes, billing practices (including cost estimates, itemized invoicing, change orders), completed audits (name, type, period, estimated vs. actual hours and costs, total cost and cost as a percent of operating budget), and audit schedules (including use of private firms).
    • Confirms authority to contract with private CPAs; requires the Auditor to present contract need, estimated cost and duration to the Audit & Fiscal Review Committee prior to contracting.

  • Audit charging and payment rules:

    • The State Auditor shall charge agencies an amount equal to the cost of audits and other services for agencies that receive and expend non‑general fund moneys. The charge may be reduced for agencies that expend both general and nongeneral funds.
    • Agricultural commodity groups listed in NDCC 4.1‑44‑04: fixed audit fees of $6,000 for an annual financial-statement audit or $4,000 for a two‑year single‑page financial statement audit performed during the biennium ending June 30, 2025; thereafter the fee may increase by 5% on July 1 of each odd‑numbered year.
    • State agencies are required to use nongeneral fund moneys to pay audit costs; if unavailable, agencies may use general fund moneys only with approval of the Legislative Assembly or the Budget Section when the Assembly is not in session (subject to NDCC 54‑35‑02.9).

  • Higher education exemption:

    • The State Auditor may not charge audit fees to institutions/units under the State Board of Higher Education except for a proportional share on federal programs/grants to the extent federal cost recovery permits (text indicates continuation of prior exemption language).

  • Subpoenas:

    • The bill also amends NDCC sections 54‑10‑19 and 54‑10‑27 related to subpoenas issued by the State Auditor. (Full textual changes to subpoena procedure/authority are not shown in the excerpt.)

Who is affected

  • State agencies and entities that receive/ expend nongeneral fund moneys (will generally bear audit costs).
  • Agricultural commodity groups listed in NDCC 4.1‑44‑04 (subject to specified fixed fees).
  • Institutions under the State Board of Higher Education (retain limited fee exemptions subject to federal program cost recovery).
  • The State Auditor’s office (new/clarified reporting and contracting requirements).
  • Legislative Audit & Fiscal Review Committee and Budget Section (involved in approvals and oversight).

Procedural / timeline notes

  • Introduced March 11, 2025; filed with the Secretary of State April 22, 2025.
  • Committee activity and reporting occurred in March–May 2025 (committee report printed 05/08/2025; reported favorably 05/07/2025).
  • The bill amends multiple sections of the Century Code and includes a retroactive‑application note in section 54‑10‑01 (as indicated in text).

Observations / caveats

  • Some portions of the enrolled/first‑engrossed text are truncated in the available excerpts (notably full details of the higher education exemption and the exact subpoena modifications). For detailed statutory language and exact subpoena changes, consult the complete enrolled bill text or the codified sections after enactment.

Compiled from official sources — confirm details with the bill’s official record.

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