PURPOSE: The state auditor has authority to establish standards and reporting requirements for audits performed on fire protection districts in St. Louis and Greene Counties, This rule sets forth requirements to be met directly by the district.

1. (1) The district is responsible for preparing and providing financial information to be included in the audit report. The district shall maintain adequate accounting records for that purpose. These records may be maintained on the bases of accounting deemed appropriate by the district but the records shall provide adequate information to allow the district to report in accordance with generally accepted accounting principles.
2. (2) The district shall engage an independent _ _ auditor to conduct the audit, The state auditor does not recommend, select or approve the district’s auditor or the auditor’s fee, except as provided in 15 CSR 40.4.010(4). The district is responsible for fulfilling all contractual obligations with the auditor, including payment of all earned fees.

3. (3) The district shall require from the independent auditor an engagement letter which sets out all essential particulars. A copy of the engagement letter shall be submitted to the state auditor for his/her review before commencement of audit fieldwork. The purpose of this review is to provide reasonable assurance that the district has contractually committed an auditor to provide services to satisfy , requirements of 15 CSR 40-4. The contents of this letter should include, but are not limited to:

   1. (A) Period for which the financial statements are audited;
   2. (B) Purpose of the audit
   3. (C) Scope of the audit, m&ding consideration of the internal control structure and tests of compliance with applicable laws and regulations;
   4. (D) Provisions that the auditor will communicate, in writing, to the district material weaknesses or reportable conditions in the internal control structure, instances of noncompliance with applicable laws and regulations and other areas of possible improvement;

   5. (E) Provision that all workpapers, etc., will be made available to the state auditor for his/her review upon his/her request;

      MISSOURI secretary 0‘ state

   6. (F) Provision that the auditor will comply with applicable rules issued by the state auditor under 15 CSR 40;
   7. (G) Provision that the auditor will discuss with the district any factors s/he may discover which would prevent him/her from issuing an unqualified opinion on the financial state ments and allow the district and the auditor the opportunity to arrive at a resolution acceptable to both;
   8. (H) Statement of the auditor’s responsibility for detection of errors, irregularities and illegal acts; and
   9. (I) The estimated cost of the audit and the rates which are the basis for that estimate.
4. (4) The district must file a copy of the completed audit report with the state auditor within six (6) months after the close of the audit period. If any audit report fails to comply with promulgated rules, the state auditor will notify the district and specify the defects. If the specified defects are not corrected within ninety (90) days from the date of the state auditor’snotice to thedistrict, orif a copy of the required audit report has not been received by the state auditor within the specified time, the state auditor will make, or cause to be made, the required audit at the expense of the district. Auth: section 321.690, RSMo (Cum. Supp. 1993).* Original rule filed May 12, 1978, effective Sept. 11, 1978. Amended: FiledDee. 2.1985. effectiueFeb. 13.1986. Amended: FiZed j&e I4,1994, efjectiue Not% 30,1994. *Original authority 1977, amended 1981,1986, 1991,1993.