Firm Profile Datasheet for IPAs

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MEMORANDUM

December 21, 2007

TO: Independent Public Accountants
FROM: Hector H. Balderas, State Auditor
SUBJECT: 2008 Firm Profile Due February 1, 2008

In order to be eligible to respond to New Mexico government agency requests for price quotes or requests for proposals for audit services, an Independent Public Accountant (IPA) must first complete and submit a Firm Profile packet issued by the Office of the State Auditor (OSA). The packet consists of nine pages and related attachments required by the accompanying checklist. If additional space is required on any of the forms, attach a separate sheet in a similar format with the additional information. Firm profiles that meet the eligibility requirements set forth in 2.2.2 New Mexico Administrative Code (NMAC), Requirements for Contracting and Conducting Audits of Agencies, commonly know as the State Audit Rule, will be considered for the list of OSA Auditor approved IPAs for fiscal year 2008 audit engagements.

The COMPLETED firm profile packet must be received by the OSA no later than 5:00 p.m., February 1, 2008. Any profiles received AFTER the due date will not be reviewed for consideration by the OSA until April 15, 2008 or later. The failure to meet the deadline may jeopardize the audit firm’s ability to get on the approved list of IPA’s and/or their ability to provide agencies bids for their audit services in a timely fashion.

PEER REVIEW

The State Auditor requires in Section 2.2.2.14.B(4) of 2.2.2 NMAC, that the IPA submit the following documentation with the firm profile:

External quality control review report for the auditor’s firm;
The corresponding letter of comments;
Auditor’s response to the letter of comments;
The letter of acceptance from the peer review program in which the firm is enrolled;
A list of the governmental audit(s) reviewed during the peer review; and
The peer reviewer’s own peer review reflecting an unqualified opinion.

New Mexico regulation requires in Section 2.2.2.14.B(3) of NMAC that the location of the external quality control review must be the office of the firm under review, regardless of whether the firm reviewed is a sole practitioner and regardless of the number of firm employees. Per Section 2.2.2.14.B (5) of NMAC, any firm that receives an opinion less than modified on the auditor’s peer review will disqualify the IPA from doing governmental audits.

Per the American Institute of Certified Public Accountants (AICPA) Standards for Performing and Reporting on Peer Reviews, effective for peer reviews commencing on or after January 1, 2005, the peer review deadline is: (1) eighteen months from the date the firm enrolled in the Program or should have enrolled, whichever date is earlier. If a firm is enrolled in the program, but does not perform engagements requiring it to undergo a peer review, it is not required to undergo a peer review. However, when a firm performs its first engagement requiring a peer review, the firm’s due date will be eighteen months from the year-end of that engagement.

CONTINUING PROFESSIONAL EDUCATION

The Continuing Professional Education (CPE) requirements remained basically unchanged in the Government Auditing Standards July 2007 Revision. This updated version of the Yellow Book is effective for periods beginning on or after January 1, 2008 (FY09). Per generally accepted government auditing standards (GAGAS) Section 3.46, “Auditors performing work under GAGAS, including planning, directing, performing field work, or reporting on an audit or attestation engagement under GAGAS, should maintain their professional competence through continuing professional education (CPE). Therefore, each auditor performing work under GAGAS should complete, every 2 years, at least 24 hours of CPE that directly relates to government auditing, the government environment, or the specific or unique environment in which the audited entity operates. For auditors who are involved in any amount of planning, directing, or reporting on GAGAS assignments and those auditors who are not involved in those activities but charge 20 percent or more of their time annually to GAGAS assignments should also obtain at least an additional 56 hours of CPE (for a total of 80 hours of CPE in every 2-year period) that enhances the auditor’s professional proficiency to perform audits or attestation engagements. Auditors required to take the total 80 hours of CPE should complete at least 20 hours of CPE in each year of the 2-year period.”

IPA firms that are not interested in performing governmental audits but wish to remain on the OSA mailing list should notify the office in writing by February 1, 2008.

You may download, print, complete and return this form: Firm Profile Datasheet – pdf file format; and Individual Profile Worksheet. You can go to http://saonm.org/infoforfirms-profile.php to download the forms. You will need a copy of Adobe Acrobat Reader installed on your computer in order to view the pdf file format. You can download a free version of Adobe Acrobat from http://www.adobe.com. If you have any questions related to the download process contact Art Baca at (505) 476-3800. For contracting and other related issues please contact Denise Duran or Frank Valdez at 476-3800.

Firm Memorandum - PDF file format (59 kb)

Firm Profile Datasheet - PDF file format (133 kb)
Individual Profile Worksheet - PDF file format (37 kb)