diff --git a/tests/functions/test_file_utils.py b/tests/functions/test_file_utils.py
index d3449f76..4e7b1c7e 100644
--- a/tests/functions/test_file_utils.py
+++ b/tests/functions/test_file_utils.py
@@ -1,22 +1,20 @@
 # tests/functions/test_file_utils.py
 
+import pytest
+from pathlib import Path
+import sys
 import logging
 import json
-import sys
 from pathlib import Path
 from pprint import pprint
 
-import pytest
-
-from loguru import logger
-
-# Ensure the repository root is on sys.path so ``ryan_library`` can be imported during tests
-REPO_ROOT = Path(__file__).resolve().parents[2]
-if str(REPO_ROOT) not in sys.path:
-    sys.path.insert(0, str(REPO_ROOT))
+# Ensure the project root is on sys.path for direct test execution
+PROJECT_ROOT = Path(__file__).resolve().parents[2]
+if str(PROJECT_ROOT) not in sys.path:
+    sys.path.insert(0, str(PROJECT_ROOT))
 
 # Import the function to be tested
-from ryan_library.functions.file_utils import find_files_parallel, is_non_zero_file
+from ryan_library.functions.file_utils import ensure_output_directory, find_files_parallel, is_non_zero_file
 
 # Configure logging for tests
 logging.basicConfig(
@@ -49,18 +47,18 @@ def setup_test_environment():
     return TEST_DATA_DIR
 
 
-def resolve_paths(relative_paths):
+def resolve_paths(relative_paths: list[Path | str]) -> list[Path]:
     """
     Helper function to resolve relative paths to absolute Path objects.
     """
     return [TEST_DATA_DIR / Path(p) for p in relative_paths]
 
 
-def test_find_files_inclusion_only(setup_test_environment, load_expected_files):
+def test_find_files_inclusion_only(setup_test_environment: Path, load_expected_files) -> None:
     """
     Test the find_files_parallel function with only inclusion patterns.
     """
-    root_dir = setup_test_environment
+    root_dir: str | Path = setup_test_environment
 
     # Define inclusion patterns with wildcard
     include_patterns = "*.hpc.dt.csv"
@@ -69,7 +67,7 @@ def test_find_files_inclusion_only(setup_test_environment, load_expected_files):
     exclude_patterns = None
 
     # Call the function
-    matched_files = find_files_parallel(
+    matched_files: list[Path] = find_files_parallel(
         root_dirs=[root_dir],
         patterns=include_patterns,
         excludes=exclude_patterns,
@@ -329,6 +327,33 @@ def test_find_files_with_report_level(setup_test_environment, load_expected_file
     # assert any("Searching in folder" in message.message for message in caplog.records), "Expected log messages not found."
 
 
+def test_ensure_output_directory_creates_missing_nested(tmp_path):
+    """Ensure missing nested directories are created."""
+
+    nested_dir = tmp_path / "level_one" / "level_two"
+    assert not nested_dir.exists()
+
+    ensure_output_directory(nested_dir)
+
+    assert nested_dir.exists()
+    assert nested_dir.is_dir()
+
+
+def test_ensure_output_directory_idempotent_existing(tmp_path):
+    """Ensure calling on an existing directory does not recreate it."""
+
+    existing_dir = tmp_path / "already_there"
+    existing_dir.mkdir(parents=True)
+    sentinel_file = existing_dir / "sentinel.txt"
+    sentinel_file.write_text("sentinel")
+
+    ensure_output_directory(existing_dir)
+
+    assert existing_dir.exists()
+    assert existing_dir.is_dir()
+    assert sentinel_file.exists()
+
+
 @pytest.mark.parametrize(
     ("scenario", "expected_result", "expected_log_fragment"),
     [