What should a public accountant do if evidence of financial misconduct is discovered during an audit of a political subdivision?
Public accountants are required by Minn. Stat. § 6.67 to promptly report to the the Office of the State Auditor and the appropriate county attorney when they discover evidence of financial misconduct during an audit of a political subdivision or a local public pension plan. In order to qualify as “prompt,” reporting should be done prior to the routine filing of the public entity’s audit with the the Office of the State Auditor. This reporting obligation includes the following: counties, cities, towns, school districts, metropolitan or regional agencies, public corporations, local public pension plans, volunteer fire relief associations, special districts, watershed districts, sanitary districts, regional public library districts, park districts, economic development authorities, and housing and redevelopment authorities.