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NYS Comptroller

THOMAS P. DiNAPOLI

Cost-Saving Ideas: School District Auditing – External Auditor

The external auditor performs the legally required financial statement audit and renders an opinion on whether the financial statements are in accordance with Generally Accepted Accounting Principles (GAAP).

Hiring an external auditor

  • It is required to hire an external auditor unless your district or BOCES has fewer than eight teachers.
  • Use the request for proposal (RFP) to hire the external auditor on a five-year basis/term.
  • Consider changing the audit firm to ensure independence and fresh prospective. (We encourage, but don’t require, audit rotation.)

Who qualifies

Candidates for the position must:

  • be a Certified Public Accountant (CPA) or an independent Public Accountant (PA) registered and licensed to practice in New York State;
  • have or develop expertise in district financial operations, pertinent statutes and regulations, purchasing policies, and accounting systems and procedures; and
  • provide an affirmative statement that the individual or firm is independent of the district as defined by Generally Accepted Government Auditing Standards (GAGAS).

Who does not qualify

  • The district’s claims auditor
  • The district’s deputy claims auditor
  • The district’s internal auditor
  • Any firm or individual whose hiring would result in a conflict of interest (see Avoiding conflict of interest)

Resources

"External Audit Guidance for School Districts [pdf]," - Office of the State Comptroller

"Sample Request for Proposals (RFP) for External Auditor," - State Education Department

Other auditing roles

Return to School District Auditing – Roles, Responsibilities and Resources

Updated 2016