Louisiana Revised Statute (R.S.) 24:513 and 24:514 (the audit law) requires local government agencies and quasi-public organizations (local auditees) to provide annual financial reports to the Louisiana Legislative Auditor (LLA). These reports provide assurance to citizens, legislators and other users that government funds are accounted for, and that local auditees are in compliance with applicable laws and regulations.
Local government agencies in Louisiana include:
- Assessors
- City and District Courts
- Clerks of Court
- District Attorneys
- District Public Defenders
- Housing Authorities
- Mortgage Authorities
- Municipalities
- Parish Governing Authorities
- School Boards
- Sheriffs
Entities that meet the following definition of a quasi-public organization in R.S. 24:513 A (1) (b) must also provide an annual financial report to LLA:
- (i) An organization, either not-for-profit or for-profit, created by the state of Louisiana or any political subdivision or agency thereof, any special district or authority, or unit of local government to perform a public purpose
(ii) An organization, either not-for-profit or for-profit, that is a component unit of a governmental reporting entity, as defined under generally accepted accounting principles
(iii) An organization, either not-for-profit or for-profit, created to perform a public purpose and having one or more of the following characteristics:- (aa) the governing authority is elected by the general public;
(bb) a majority of the governing body is appointed by or authorized to be appointed by a governmental entity or individual governmental official as a part of his official duties;
(cc) the entity is the recipient of the proceeds of an ad valorem tax or general sales tax levied specifically for its operations;
(dd) the entity is able to directly issue debt, the interest of which is exempt from federal taxation; or
(ee) the entity can be dissolved unilaterally by a governmental entity and its net assets assumed without compensation by that governmental entity.
- (aa) the governing authority is elected by the general public;
R.S. 17:4022, assistance to private colleges and universities, or benefits to individuals.
(v) Any organization, either not-for-profit or for profit, which is subject to the open meetings law and derives a portion of its income from payments received from any public agency or body.
It is usually a relatively simple matter to determine if an entity can be categorized as a local government agency. And, the descriptions of entities that meet the definitions of a quasi-public organization that are found in in R.S. 24:513 A. (1) (b) (i) through (iii) and (v) are fairly specific.
Most of the questions about reporting requirements to LLA come from nonprofits that want to know if they fit the definition of a quasi-public organization found in R.S. 24:513 A. (1) (b) (iv). These nonprofits receive some type of payment from a Louisiana state or local government agency, and it is unclear as to whether the payment is “local or state assistance,” receipt of which would require a nonprofit to report to LLA; or a vendor contract or other type of payment exempted from the reporting requirement.
There is a document on LLA’s website that will help a nonprofit in determining if it has a reporting requirement to LLA under R.S. 24:513 A. (1) (b) (iv). There is also a document on LLA's website that discusses how the receipt of federal funds by a nonprofit affects that nonprofit's reporting requirement to LLA. LLA staff can also assist a nonprofit in making that determination.
If you have a question as to whether or not your nonprofit or other agency has a reporting requirement to LLA, please contact LLA’s Local Government Services (LGS) staff.
Questions:
- My nonprofit agency received state and/or local government funds, but LLA has never contacted me to tell me that I need to report to them. Does that mean I don’t have to report to LLA?
- This is the first year that my nonprofit agency has received local or state assistance. What should I do to fulfill my reporting requirements to LLA?
- I am the executive director of a nonprofit corporation. I realized that my agency should have provided an audit report to LLA for state assistance we received last year. It is eight months after the fiscal year end in which my agency should have reported, and the report is now late. What should I do?
- I am the executive director of a private school. My understanding is that private schools are exempted from providing an annual financial report to LLA. However, my private school receives funds under the Student Scholarships for Educational Excellence Program (R.S.17:4014 et seq.); and under R.S. 24:513.A (1) (b) (iv) and R.S. 17:4022, appears to have some type of reporting requirement to LLA. Can you clarify what that reporting requirement is?