This bill amends Minnesota Statutes 2024, section 412.591, subdivision 3, to raise the revenue threshold that requires cities to perform annual audits. Specifically, the bill changes the threshold from $150,000 to $500,000 for combined governmental and enterprise funds. If a city's annual revenue exceeds this new threshold, the city council must provide for an annual audit by the state auditor or a certified public accountant. Conversely, if the revenue is at or below the new threshold, the council is required to conduct an audit at least once every five years.

Additionally, the bill updates the effective date for these changes to August 1, 2025, and specifies that the new audit requirements will apply to audits performed for the year 2026 and thereafter. This adjustment aims to align the audit requirements with current economic conditions, as indicated by the implicit price deflator for state and local expenditures published by the United States Department of Commerce.

Statutes affected:
Introduction: 412.591