OSA Weekly Update - 2/3/2023
1. Message from Auditor Blaha
2. Released: Pension Newsletter
3. Due: 2022 Annual Forfeiture Expenditures Reporting by February 28, 2023
4. Available: 2022 Annual Financial Reporting Forms
5. Released: 2022 Revenue Thresholds for Audit Requirements
6. TIF: TIF Four-Year Knockdown Rule
7. Avoiding Pitfall: Internal Control – More than the Annual Audit
1. Message from Auditor Blaha
This new year has been all about reconnections. This week I’ve been busy meeting with local leaders across Minnesota. I spoke with township officials during Township Day at the Capitol – we shared insights from our most recent Town Finances Report and answered questions about CTAS 2023. I also presented at the AMC Futures Task Force Dinner where I had a great time connecting with county leaders. I ended my week meeting with Black business owners at Black Entrepreneurship Day at the Capitol – it was wonderful to learn more about how Black owned businesses lift local economies and help us all.
I would love to connect with you - reach out to me anytime at State.Auditor@osa.state.mn.us.
2. Released: Pension Newsletter
The January Pension Newsletter has been released. The Newsletter provides a link to the updated Agreed-Upon Procedures Guide and Sample Independent Accountant’s Report for relief associations with special fund assets and liabilities below the audit threshold. The Newsletter also provides an update on legislative proposals being considered by the Fire Relief Association Working Group, and information about the upcoming fire chief service credit certification deadline. Reminders about the Fire Equipment Certification Form and Supplemental Benefit Reimbursement Form filed with the Department of Revenue are also included.
3. Due: 2022 Annual Forfeiture Expenditures Reporting by February 28, 2023
Please remember to report expenditure of forfeited property proceeds, including proceeds received through state and federal forfeiture law to the Office of the State Auditor (OSA) by February 28, 2023.
Instructions for the Forfeiture Expenditures form may be found on the OSA website.
Reporting must be done using the online reporting tool available in the State Auditor’s Form Entry System (SAFES).
If you have not used SAFES in the past and need a username and password, please e-mail your contact information including name, title, entity mailing address, and phone number to SAFES@osa.state.mn.us.
If you have questions or need assistance completing the form, please contact Ms. Christy John at (651) 297-3681 or e-mail Christy.John@osa.state.mn.us.
4. Available: 2022 Annual Financial Reporting Forms
The 2022 Annual Financial Reporting Form (Reporting Form) is now available through the State Auditors Form Entry System (SAFES). You will need a SAFES User ID and Password to access the Form. If you need a SAFES User ID and Password, please send an email to SAFES@osa.state.mn.us with your name, title, entity, public mailing address, email, and phone number.
Instructions on completing the Reporting Form can be found on the OSA website.
CTAS Users are now also able to submit the State Auditor Data File and Financial Statements right from CTAS. Instructions can be found on the OSA website.
For local government entities reporting on a cash basis of accounting, the Reporting Form (CTAS: State Auditor Data File) and Financial Statements or Audit are due by March 31, 2023. For entities reporting on a GAAP basis of accounting, the Reporting Form and Audit are due by June 30, 2023.
5. Released: 2022 Revenue Thresholds for Audit Requirements
Cities – A city with a population over 2,500 must have an annual audit performed.
Cities with Combined Clerk/Treasurers – A city with a population of 2,500 or less and a combined clerk/treasurer must have an annual audit for 2022 if its annual revenue is more than $272,000. A city with a combined clerk/treasurer and annual revenue of $272,000 or less must have an Agreed-Upon Procedures engagement once every five years.
Towns – A town with a population over 2,500 and 2022 annual revenue of $1,215,000 or more must have an annual audit.
Towns with Combined Clerk/Treasurers – A town with a combined clerk/treasurer must have an annual audit for 2022 if its annual revenue was more than $272,000. A town with a combined clerk/treasurer and annual revenue of $272,000 or less must have an Agreed-Upon Procedures engagement once every five years.
Special Districts – A special district must have an annual audit for 2022 if its annual revenue was more than $272,000. A special district with annual revenue of $272,000 or less must have an Agreed-Upon Procedures engagement once every five years.
The Office of the State Auditor has developed minimum procedures and a reporting format for Agreed-Upon Procedures engagements of cities and towns that have combined the offices of clerk and treasurer, and special districts, with annual revenues less than the audit threshold. The minimum procedures and reporting format for Agreed-Upon Procedures engagements can be found on the OSA website.
6. TIF: TIF Four-Year Knockdown Rule
TIF authorities must submit evidence to the county auditor by February 1 of the fifth year following certification of a TIF district that activity in accordance with the TIF plan has occurred on parcels in the TIF district. Please do so ASAP if you haven't yet. County auditors must then review this evidence and enforce the Four-Year Knockdown Rule if no activity has occurred on a parcel. To learn more, please view the OSA Statement of Position.
If you have any questions, please contact us at tif@osa.state.mn.us.
7. Avoiding Pitfall: Internal Control – More than the Annual Audit
To lessen the risk of fraud, public entities need more than an annual audit. They need to design and implement internal controls to prevent and detect fraud.
Every public employee plays a role in the internal control process. Discussions about internal controls should take place at all levels to emphasize the importance that the public entity places on fraud prevention, and to help employees understand their role in the process.
The Avoiding Pitfall is available on the OSA website.