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SB 1408

GOVT ACCOUNT AUDIT THRESHOLD

104th Regular Session Introduced by Paul Faraci and 2 co-sponsors

Raises the audit trigger from $850,000 to $1.5 million, allowing smaller Illinois units to skip annual audits and use alternative reporting options.

Added as Chief Co-Sponsor Sen. Graciela Guzmán
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WeVote Research Nonpartisan
Bill Summary · SB 1408

Summary — SB 1408 (Governmental Account Audit Act: Audit Threshold)

Status: Introduced (SB 1408)
Introduced: Jan 31 / Feb 19, 2025 (filed Feb 19, 2025)
Primary sponsor: Sen. Patrick J. Joyce (co-sponsors listed)
Title shown in bill text: Amendments to the Governmental Account Audit Act
Related/companion: HB 2457; HB 1089
Effective date: Immediately upon enactment (per bill language)

Purpose / Intent

SB 1408 raises the statutory revenue threshold that determines which local governmental units must undergo annual independent financial audits under the Illinois Governmental Account Audit Act. The change is intended to reduce the number of units required to obtain annual audits by increasing the “audit trigger” level.

Key provisions

  • Raises the audit/review threshold:
    • Changes references throughout the Act from $850,000 to $1,500,000 — i.e., any governmental unit receiving revenue of less than $1,500,000 in a fiscal year may follow alternative reporting options rather than complying with the Act’s annual audit requirements.
  • Alternative reporting options for units below the threshold (applies “in lieu of” annual audits):
    • (i) Obtain an audit once every four years and file an annual financial report with the Comptroller; or
    • (ii) File an annual financial report with the Comptroller (on Comptroller-prescribed forms) instead of an audit. That annual report must:
    • Be provided to each member of the unit’s elected board,
    • Be presented (in person or via live phone/web connection) during a public meeting, and
    • Be approved by a 3/5 majority vote of the elected board.
  • Conforming changes to audit/reporting procedures:
    • Requires reports to be submitted electronically; the Comptroller must post submitted reports on the internet no later than 45 days after filing (with limited waiver authority when electronic filing is not possible).
    • Adds/retains certain transparency items in reports (e.g., name of purchasing agent or person overseeing competitively bid contracts).
    • Amends filing and public-record requirements for audit and report copies (Sec. 6) so that governmental units make copies part of public record and file copies with the Comptroller and the county clerk.
  • Definitions and conforming edits:
    • Updates the Act’s definitions and cross-references to align with the higher threshold; retains existing definitions (e.g., “governmental unit,” “auditor,” “report”).
    • Continues existing exceptions (school districts, large counties, units audited by Auditor General, etc.).

Who is affected

  • Local governmental units in Illinois (municipal corporations and political subdivisions that appropriate more than $5,000), except those already excluded by statute (e.g., school districts, certain counties, units audited by the Auditor General).
  • Specifically, units whose annual revenues fall between $850,000 and $1,499,999 would no longer be automatically required to obtain an annual audit and may elect one of the alternate compliance options.
  • The Comptroller’s Office (administrative responsibilities for receiving, posting, and managing reports).
  • Auditors (potential reduction in annual audit engagements for smaller units).

Potential impacts

  • Administrative / fiscal:
    • Likely reduced audit costs for smaller local units that choose an alternative report or less-frequent audits; potential modest administrative burden increase for the Comptroller to process and publish additional annual reports.
    • Possible variability in financial oversight quality depending on whether units choose less frequent audits versus an annual report; the bill retains public transparency elements (board presentation, vote, electronic posting).
  • Accountability / transparency:
    • Maintains public access to financial information via required filings and public meetings; however, some units may reduce the frequency of independent audits (audit every 4 years option).

Procedural / timeline notes

  • The bill amends Sections 1, 3, and 6 of the Governmental Account Audit Act.
  • Bill text indicates it is effective immediately upon enactment.
  • Sponsors and related bills are noted above; follow-up consideration and fiscal analyses may occur as the bill proceeds through legislative committees.

For readers evaluating impacts: the principal change is a one-time increase of the audit trigger from $850,000 to $1,500,000 (with other existing filing/ transparency requirements preserved). This reduces the number of units required to obtain annual independent audits while preserving public reporting and board-level review requirements for smaller units.

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

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