Section 13-03-25-03 - Audit responsibility of the supervisory committee1.Annual audit requirement. A credit union is required to obtain an annual supervisory committee audit or financial statement audit that occurs at least once every calendar year (period of performance) and must cover the period elapsed since the last audit period (period effectively covered).2.Financial statement audit. Any credit union with assets greater than twenty-five million dollars as of its previous year-end call report must obtain an annual audit of its financial statements performed in accordance with GAAS by an independent person who is licensed to do so in this state. Any credit union with assets less than twenty-five million dollars may also choose this option. Prior to obtaining a financial statement audit, the credit union will make a good-faith attempt to obtain a copy of the peer review report of the auditing firm directly from the auditing firm to ensure the firm's auditing practices and procedures are in conformance with GAAS.3.Supervisory committee audit. Any credit union with assets less than twenty-five million dollars, if not obtaining a financial statement audit, must obtain or perform a supervisory committee audit. This audit:a. Must be completed by a qualified independent party such as a supervisory committee, board of directors, internal auditor, accounting professional, or others who can demonstrate qualifications and independence.b. Must at a minimum document a review of: (1) Board of director minutes to determine whether there are any material changes to the credit union's activities or condition that are relevant to the areas to be reviewed in the audit.(2) Test and confirm material asset and liability accounts, including:(3) Test material equity, income, and expense accounts.(4) Test for unrecorded liabilities.(5) Review key internal controls, including:(a) Bank reconciliation procedures;(c) Dormant account controls;(d) Wire and automated clearing house transfer controls;(e) Loan approval and disbursement procedures;(f) Controls over accounts of employees and officials; (g) Other real estate owned; and (h) Foreclosed and repossessed assets.(6) Test the mathematical accuracy of the allowance for loan and lease losses account and ensure the methodology is properly applied.(7) Test loan delinquency and charge-offs.N.D. Admin Code 13-03-25-03
Effective January 1, 2007.Amended by Administrative Rules Supplement 2022-384, April 2022, effective 4/1/2022.General Authority: NDCC 6-01-04
Law Implemented: NDCC 6-06-06