Request By:
Mr. Charles R. Simpson, III
Attorney at Law
Suite 601
Legal Arts Building
Louisville, Kentucky 40202
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Walter C. Herdman, Assistant Deputy Attorney General
This is in response to the second question raised in your letter dated June 18, wherein you seek information as to whether or not an annual audit is still required with respect to cities of the sixth class. Your initial question will be answered under separate cover.
The 1982 General Assembly gave sixth class cities a number of options regarding the audit of its finances and the publication of financial statements. Pursuant to a number of amendments to KRS 91A.040, particularly Section 1, subsections (1), (2) and (9), and the creation of KRS 91A.041 and 91A.045, cities of the sixth class are no longer required to have an annual audit but must have the audit completed in less than 270 days after the expiration of the term of the legislative body members.
Under subsection (9), cities of the sixth class are also given the authority to utilize the alternative publication method authorized by KRS 424.190(2) in order to comply with the provisions of KRS 91A.040. Under subsection (2) of KRS 424.190 it is provided that any fifth or sixth class city may, when the cost of newspaper publication exceeds the cost of postage, supplies and reproduction for the alternative method of publication in lieu of newspaper publication of the advertisement, substitute the delivery of a copy of the advertisement by first class mail to each residence within the publication area.
In addition, the legislature enacted KRS 91A.041 which provides in effect that in lieu of the auditing requirements set forth in KRS 91A.040, any city which for the fiscal year in question, receives and expends from all sources and for all purposes less than $25,000 and which has no long-term debt, whether general obligation or revenue debt, may comply fully with the regulations of KRS 424.220 in lieu of the requirements of KRS 91A.040. See also KRS 91A.045 of similar content.
Concerning the implementation of the various amendments to KRS 91A.040 and KRS 424.220 with respect to local governments, we suggest that you contact the Department of Finance and Administration which is required to make available to all cities whatever assistance is necessary in meeting the requirements of KRS 91A.010 to 91A.060; this pursuant to an amendment to KRS 91A.050.