This bill mandates that every school, school district, and school administrative unit receiving state funding must undergo an annual independent audit. The audit report is required to be submitted to both the Department of Education and the Department of Revenue Administration within 180 days following the end of the fiscal year. The findings from the audit must be reviewed at the next governing body meeting, and if any material deficiencies are identified, the Department of Education will appoint an individual to receive quarterly financial reports from the school entity until the issues are resolved. Additionally, all audit reports must be publicly posted on the respective school websites and shared with key stakeholders, including superintendents and local school board members.

The bill also includes provisions that require the business administrator or their designee to provide necessary data to the independent auditor promptly. Furthermore, all audits must include comparisons to data submitted to the Department of Education from the corresponding fiscal year. Notably, the Department of Education is granted the authority to withhold funding from any school administrative unit, school district, or school that fails to comply with these requirements. The act will take effect 60 days after its passage.