Shown verbatim: the complete text as captured from the official PDF posted by the Oklahoma Legislature, fetched 2026-07-23. Page and line markers are part of the official record; nothing is edited or removed. The official bill page.
1 STATE OF OKLAHOMA
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2 2nd Session of the 60th Legislature (2026)
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3 SENATE BILL 2130 By: Murdock
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6 AS INTRODUCED
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7 An Act relating to cities and towns; amending 11 O.S.
7 2021, Section 17-105, as last amended by Section 1,
8 Chapter 287, O.S.L. 2024 (11 O.S. Supp. 2025, Section
8 17-105), which relates to annual financial statement
9 audit; providing for certain exemptions to annual
9 financial statements; and providing an effective
10 date.
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13 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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14 SECTION 1. AMENDATORY 11 O.S. 2021, Section 17-105, as
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15 last amended by Section 1, Chapter 287, O.S.L. 2024 (11 O.S. Supp.
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16 2025, Section 17-105), is amended to read as follows:
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17 Section 17-105. A. The governing body of each municipality
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18 with Fifty Thousand Dollars ($50,000.00) or more in total revenue to
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19 all funds, including component units of which the municipality is a
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20 beneficiary, during a fiscal year shall cause to be prepared, by an
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21 independent licensed public accountant or a certified public
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22 accountant, an annual financial statement audit to be conducted in
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23 accordance with auditing standards generally accepted in the United
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24 States of America and Government Auditing Standards as issued by the
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Req. No. 3144 Page 1
1 Comptroller General of the United States. Such audit shall be
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2 ordered within thirty (30) days of the close of each fiscal year.
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3 Copies shall be filed with the State Auditor and Inspector within
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4 six (6) months after the close of the fiscal year in accordance with
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5 the provisions of the Municipal Audit Reform Act of 2022 and with
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6 the governing body of the municipality.
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7 B. The governing body of each municipality with Fifty Thousand
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8 Dollars ($50,000.00) or more in total revenue to all funds,
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9 including component units of which the municipality is a
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10 beneficiary, and with a population of less than two thousand five
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11 hundred (2,500) as of the most recent Federal Decennial Census, and
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12 for whom an annual financial statement audit is not required by
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13 another law, regulation or contract, shall cause to be prepared, by
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14 an independent licensed public accountant or a certified public
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15 accountant, a biennial financial statement audit in accordance with
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16 auditing standards generally accepted in the United States and
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17 Government Auditing Standards as issued by the Comptroller General
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18 of the United States. Each biennial audit shall cover the two (2)
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19 preceding years.
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20 The governing body of each municipality may alternatively
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21 request a biennial agreed-upon-procedures engagement. Agreed-upon
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22 procedures required under the Municipal Audit Reform Act of 2022
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23 shall be performed in accordance with the applicable attestation
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24 standards of the American Institute of Certified Public Accountants.
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Req. No. 3144 Page 2
1 The audit or agreed-upon-procedures engagement shall be ordered
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2 within thirty (30) days of the close of the fiscal year that the
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3 audit is due. Copies shall be filed with the State Auditor and
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4 Inspector within nine (9) months after the close of the fiscal year
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5 in accordance with the provisions of paragraph 2 of subsection A of
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6 Section 212A of Title 74 of the Oklahoma Statutes and with the
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7 governing body of the municipality, with the deadline to order and
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8 file the audit or agreed-upon procedures eligible for extension by
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9 the State Auditor and Inspector for special circumstances or
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10 emergencies.
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11 C. 1. The municipal income requirements in subsections A and B
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12 of this section shall not include any grant monies provided to a
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13 municipality from any federal, state, or other governmental entity.
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14 The municipal income requirements shall not include income of any
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15 public trust established under Sections 176 through 180.4 of Title
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16 60 of the Oklahoma Statutes with a municipality as the beneficiary
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17 of the trust; provided, income from trusts established principally
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18 for the purpose of operating electric, water, wastewater, and
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19 sanitation utilities shall be included for purposes of the municipal
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20 income requirements.
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21 2. Other than an audit required pursuant to Section 180.1 of
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22 Title 60 of the Oklahoma Statutes, a municipality with a total
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23 revenue of less than Fifty Thousand Dollars ($50,000.00) across all
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24 funds, including component units of which the municipality is a
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1 beneficiary, and a population of less than five hundred (500) as of
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2 the most recent Federal Decennial Census shall not be required to
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3 prepare an audit or agreed-upon-procedures engagement solely as a
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4 condition to be eligible or a recipient of a grant from any federal,
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5 state, or local source.
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6 D. The governing body of each municipality that requests the
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7 biennial agreed-upon-procedures engagement provided in subsection B
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8 of this section shall:
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9 1. Determine the establishment of policies related to
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10 adjustments, write-downs, or write-offs for various receivables due
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11 to the municipality or the utility-related trust and select a sample
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12 of adjustments to test for adherence to policies and for appropriate
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13 supporting documentation;
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14 2. Obtain two (2) months of bank statements of the general fund
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15 and utility fund and confirm that cash deposits were made in the
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16 appropriate accounts and verify utility billing receipts or posting
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17 reports agree with the daily deposits;
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18 3. Agree upon a pay rate for the city manager or town
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19 administrator, city or town clerk, city or town treasurer, and
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20 payroll clerk, to be authorized and documented in the personnel file
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21 or in approved meeting minutes. If any employee received
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22 compensation over and above his or her authorized salary or hourly
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23 rate, the payroll clerk, upon request, shall provide appropriate
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24 documentation of authorization for such pay. The requirements of
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Req. No. 3144 Page 4
1 this paragraph shall not include expense reimbursements but shall
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2 include any allowances considered taxable;
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3 4. Determine the establishment of policies of use, proper
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4 municipal purpose, and adherence to prescribed policies for entities
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5 that use debit or credit cards;
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6 5. Select a sample of transactions to test for supporting
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7 documentation;
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8 6. Prepare a cash basis schedule of changes in fund balances
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9 for each fund and determine compliance with the statutory
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10 prohibition of creating fund balance deficits;
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11 7. Agree material fiscal year-end bank account balances to bank
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12 statements and trace significant reconciling items to subsequent
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13 clearance and determine if any bank accounts exist that are not
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14 under city council purview;
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15 8. Compare uninsured deposits at fiscal year-end to the fair
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16 value of pledged collateral;
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17 9. Inquire if any instances of known fraud, illegal acts, or
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18 noncompliance with laws and regulations have occurred; and
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19 10. Compare the use of material-restricted revenues and
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20 resources to the restrictions of the governing body of the
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21 municipality.
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22 E. A public trust with a municipal government or governments as
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23 the beneficiary that meet the same financial requirements
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24 established in subsection B of this section may, as an alternative
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1 to obtaining an audit as required in Section 180.1 of Title 60 of
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2 the Oklahoma Statutes, follow the biennial agreed-upon-procedures
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3 engagement outlined in subsection D of this section.
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4 SECTION 2. This act shall become effective November 1, 2026.
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6 60-2-3144 YG 1/15/2026 1:14:52 PM
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Req. No. 3144 Page 6Every fact on this page links to its source, starting with the official bill record.