State Auditors on the Job
Expanding the Audit Pool
The State Auditor's Office continually solicits new firms to join the pool of independent public accountants eligible to compete for the annual financial and compliance audits.
The pool has been expanded in recent years as the Office of the State Auditor improved relationships with independent public accountants.
Expanding the number of accountants in the bidding process is intended to make bids more competitive and increases the quality of the audits.
Accounting firms must provide to the State Auditor's Office an organizational chart, results of an external quality peer review conducted every three years, proof of professional liability insurance, proof of an accounting license, a list of all certificate holders, a list of any professional service contracts performed for government entities and an individual firm profile document.
Financial and Compliance Audits
All state agencies, local governments, colleges and universities, and public schools must be examined annually under New Mexico law. Audits begin near the end of the fiscal year on June 30 in New Mexico. More than 544 audits are performed with a cost of more than $6 million. The agencies being audited pay for these audits.
Independent public accountants across the state perform most of the audits. The Office of the State Auditor and various professional organizations establish the stringent criteria for auditing governmental agencies. Accountants compete through a bid process governed by the state procurement code, price and professional competency for these audit contracts from state and local agencies.
Once selected by the state or local agency, the State Auditor's Office approves the contracts with the independent public accountants. Contracts may be renewed for no more than six consecutive years. The State Auditor's Office requires agencies to change auditors after six years to make sure an auditor's independence is maintained.
The state auditor's staff travels throughout New Mexico to meet with public accountants and financial department employees of governmental entities to discuss state and federal changes in accounting and auditing standards. The office conducts educational sessions for accountants and governmental employees as necessary to help them stay current on accounting changes.
Reviewing the Audits and Distributing Reports
When audits are completed, they are sent to the State Auditor's Office in Santa Fe for review. Each audit report is checked for accuracy and reviewed with an eye toward the public body's compliance with appropriate accounting procedures and standards.
The review procedures have become more extensive to ensure the quality of the audit reviews themselves. If after review, the report is not approved, it will be returned to the independent public accountant for corrections and for explanations.
Audit reports become public documents ten days after the State Auditor's Office releases them. Once the report is released and becomes a public record, copies are sent to the Legislative Finance Committee, the Department of Finance and Administration and the State Treasurer's Office. Copies of school district audit reports are forwarded to the State Department of Education. Copies of reports for colleges and universities are sent to the Commission on Higher Education. Copies are also sent to applicable state agencies.
Audit reports are also available for public review at the audited agency or at the State Auditor's Office.
Special Audits and Fraud Audits
Annual audit reports can help administrators identify problems at an early stage so they can be addressed before they worsen.
State government alone has a budget in excess of $4 billion. This increases dramatically when federal funds are added. Government agencies must adhere to federal and state laws, rules and regulations when spending tax dollars regardless of the source of the money.
The New Mexico State Auditor's Office has the authority to perform special audits to detect problems and assist in corrective measures.
The State Auditor's Office also is responsible for fraud audits. Under certain circumstances, they are completed with assistance from the New Mexico Attorney General's Office or district attorneys. Special and fraud audits can be initiated after routine annual reviews suggest further examination of an agency's records is required.
Information regarding fraud form government employees or other citizens can trigger such audits if reported to the State Auditor's Office.
Information can be reported to the New Mexico State Auditor's Office at 1-800-432-5517 or 505-827-3500; or in writing to 213 Warner Circle, Santa Fe, NM 87505-5499. All Information reported in this manner will be reviewed thoroughly and professionally.
Auditor Works with a Diverse List of Clients
The State Auditor's Office has a diverse list of clients that range from large state agencies to small special districts. Serving such a diverse group of clients requires expertise in a number of accounting and auditing areas.
The office conducts audits on a variety of agencies to give its staff as wide a range of expertise as possible so that all clients may be better served through professional, experienced employees. The governmental entities that the State Auditor's Office serves are:
| State agencies | 90 |
| District Attorneys | 15 |
| District Court | 14 |
| Municipalities | 104 |
| Municipal gas companies | 2 |
| Municipal housing authorities | 33 |
| Municipal self insurance funds | 1 |
| Counties | 33 |
| County housing authorities | 9 |
| County insurance funds | 2 |
| School Districts | 90 |
| Charter Schools | 31 |
| Regional education cooperatives | 6 |
| Regional center cooperatives | 6 |
| Colleges and universities | 19 |
| Hospitals | 12 |
| Independent housing authorities | 5 |
| Special districts | 41 |
| Soil and Water Districts | 47 |
| Mutual Domestic Water Conservation Districts | 8 |
| Total | 568 |
