FRANKFORT, Ky. (February 1, 2023) – During remarks at the Kentucky County Judge/Executives Association's (KCJEA) winter conference in Lexington, State Auditor Mike Harmon announced thanks to a law his office actively supported in 2018, counties have saved more than $1.6 million dollars on audit costs over the last four years.
Senate Bill 144, which passed unanimously in the House and Senate during the 2018 session of the Kentucky General Assembly, gives the option for county sheriffs and county clerks who have good performance records the ability to receive an agreed-upon procedures, or AUP, engagement instead of a full financial audit.
“Most Kentuckians don't know that a portion of the funding for the Auditor's office comes from charging for the audits we conduct," said Auditor Harmon. “My administration supported Senate Bill 144 because of our belief it would save counties money on their audit costs. At the time we estimated around 25 to 50 percent savings on the cost of an AUP compared to a full financial statement audit, and I'm proud to say that the results have greatly exceeded those estimates."
According to Auditor Harmon's office, 32 county sheriffs received an AUP for 2021. The cost of those AUPs compared to their last full financial statement audit was on average 66.9%. The total cost savings for those 32 county sheriffs was more than $220,000.
There were 12 county clerks who received AUPs for 2021. Those county clerks saw an average 66.4% reduction in their costs compared to their last full financial audit, or a total dollar savings of a little over $78,000.
“If you follow the data, I believe this is a prime example of how we as elected leaders can come up with ways to be more efficient with the money the taxpayers of Kentucky provide," Auditor Harmon said. “I encourage county fiscal courts to check with their sheriffs and clerks and find out if they have applied to receive an AUP for 2022. That way they can join other counties in the $1.6 million in savings resulting from AUPs."
Auditor Harmon adds that in addition to reducing audit costs for counties, the AUP law has allowed his auditing staff to shift to other areas including special examinations.
For more information on the AUP program for county clerks and sheriffs, click here.