Firm Profile Process and Due Date
Notice: All Firms Interested in Conducting Financial Compliance and
Agreed-Upon Procedures (AUP) for FY2020.
Firm profile submission for 2020 will need to be completed and submitted through OSA-Connect by the first business day in January of 2020. If you are a new firm and would like to obtain credentials to submit a firm profile for the 2020 approved list of firms, simply send Bernadet Martinez an e-mail requesting access for OSA-Connect (email)
In the event that your firm profile is not received by the due date your firm will not be included in the initial 2020 list of firms approved to conduct financial compliance audits and/or agreed-upon procedures. We will not be accepting any paper or e-mail submissions for firm profiles or “quick updates” to firm profiles. Any submissions submitted by paper or e-mail will not be considered received.
It is also the responsibility of the Firm to ensure that the OSA has a current version of the firm permit, the certificate of insurance for the firm, and each CPA’s CPA license at all times thought the year. Failure to timely submit copies of these updated documents through OSA-Connect may result in the Office withholding contract approvals pending receipt of the required documents. It is also the Firm’s responsibility to ensure that each staff member is in compliance with GAGAS CPE requirements. The Office may conduct an audit of the documentation that supports the information provided in the firm profile, contemporaneously with the work paper review process, or otherwise.
Audit Rule Citations:
220.127.116.11 THE PROCUREMENT AND AUDIT PROCESS:
- Firm profiles: For an IPA to be included on the state auditor’s list of approved firms, an IPA shall submit a firm profile online annually on the first business day in January, in accordance with the guidelines set forth herein. The OSA shall review each firm profile for compliance with the requirements set forth in this rule. IPAs shall notify the state auditor of changes to the firm profile as information becomes available. The state auditor shall approve contracts only with IPAs who have submitted a complete and correct firm profile that has been approved by the OSA, and who have complied with all the requirements of this rule, including but not limited to:
(1) Subsection A of Section 18.104.22.168 NMAC, continuing professional education requirements for all staff that the firm will use on any New Mexico governmental engagements;
(2) listed professional service contracts the firm entered into;
(3) for IPAs who have audited agencies under this rule in the past, they shall have previously complied with: Section 22.214.171.124 NMAC, Report Due Dates, including notifying the state auditor regarding late audit reports and Section 126.96.36.199 NMAC, review of audit reports and audit documentation.
- List of approved firms: The state auditor shall maintain a list of independent public accounting (IPA) firms that are approved and eligible to compete for audit contracts and AUP engagements with agencies. The 2.2.2 NMAC 3 state auditor’s list of approved firms shall be reviewed and updated on an annual basis. An IPA on the list of approved firms is approved to perform government audits until the list of approved firms is published for the following year; provided that the OSA may restrict firms at any time for failure to submit firm profile updates timely. An IPA that is included on the state auditor’s list of approved firms for the first time shall be subject to an OSA quality control review of the IPA’s working papers. This review shall be conducted as soon as the documentation completion date, as defined by AU-C Section 230, has passed (60 days after the report release date). The state auditor shall approve contracts only with IPA firms that have submitted a complete and correct firm profile complying with all the requirements set forth in this rule and that has been approved by the OSA. The OSA shall inform all IPAs whose firm profiles were submitted by the due date whether they are on the list of approved firms and shall publish the list of approved firms concurrent with notification to government agencies to begin the procurement process to obtain an IPA to conduct the agency’s annual financial audit.
- Disqualified firms: An IPA firm shall not be included on the list of approved firms if any of the following applies to that IPA:
(1) the firm received a peer review rating of “failed”;
(2) the firm does not have a current New Mexico firm permit to practice;
(3) the firm profile does not include at least one certified public accountant with a current CPA certificate who has met the GAGAS CPE requirements described at Subsection A of Section 188.8.131.52 NMAC, to perform GAGAS audits;
(4) the IPA has been restricted in the past and has not demonstrated improvement (this includes submitting excessively deficient audit reports or having excessively deficient workpapers);
(5) the IPA made false statements in their firm profile or any other official communication with the OSA that were misleading enough to merit disqualification; or
(6) any other reason determined by the state auditor to serve the interest of the state of New Mexico.
(1) IPAs may be placed on restriction based on the OSA’s review of the firm profile and deficiency considerations as described below. Restriction may take the form of limiting either the type of engagements or the number of audit contracts, or both, that the IPA may hold. The OSA may impose a corrective action plan associated with the restriction. The restriction remains in place until the OSA notifies the IPA that the restriction has been modified or removed. The deficiency considerations include, but are not necessarily limited to:
(a) failure to submit reports in accordance with report due dates provided in Subsection A of Section 184.108.40.206 NMAC, or the terms of their individual agency contract(s);
(b) failure to submit late report notification letters in accordance with Subsection A of Section 220.127.116.11 NMAC;
(c) failure to comply with this rule;
(d) poor quality reports as determined by the OSA;
(e) poor quality working papers as determined by the OSA;
(f) a peer review rating of “pass with deficiencies” with the deficiencies being related to governmental audits;
(g) failure to contract through the OSA for New Mexico governmental audits or AUP engagements;
(h) failure to inform agency in prior years that the IPA is restricted;
(i) failure to comply with the confidentiality requirements of this rule;
(j) failure to invite the state auditor or his designee to engagement entrance conferences, progress meetings or exit conferences after receipt of related notification from the OSA;
(k) failure to comply with OSA referrals or requests in a timely manner;
(l) suspension or debarment by the U.S. general services administration;
(m) false statements in the IPA’s firm profile or any other official communication with the OSA;
(n) failure to cooperate timely with requests from successor IPAs, such as reviewing workpapers; or
(o) any other reason determined by the state auditor to serve the interest of the state of New Mexico.
(2) The OSA shall notify any IPA that it proposes to place under restriction. If the proposed restriction includes a limitation on the number of engagements that an IPA is eligible to hold, the IPA shall not 2.2.2 NMAC 4 submit proposals or bids to new agencies if the number of multi-year proposals the IPA possesses at the time of restriction is equal to or exceeds the limitation on the number of engagements for which the IPA is restricted.
(3) An IPA under restriction is responsible for informing the agency whether the restricted IPA is eligible to engage in a proposed contract.
(4) If an agency or local public body submits an unsigned contract to the OSA for an IPA that was ineligible to perform that contract due to its restriction, the OSA shall reject the unsigned contract.
- Procedures for imposition of restrictions:
(1) The state auditor may place an IPA under restriction in accordance with Subsection D of Section 18.104.22.168 NMAC.
(a) The state auditor or his designee shall cause written notice of the restriction to be sent by email and certified mail, return receipt requested, to the IPA, which shall take effect as of the date of the letter of restriction. The letter shall contain the following information:
(i) the nature of the restriction;
(ii) the conditions of the restriction;
(iii) the reasons for the restriction;
(iv) the action to place the IPA on restriction is brought pursuant to Subsection A of Section 12-6-3 NMSA 1978 and these regulations;
(v) the IPA may request, in writing, reconsideration of the proposed contract restriction which shall be received by the OSA within 15 calendar days from the date of the letter of restriction; and
(vi) the e-mail or street address where the IPA’s written request for reconsideration shall be delivered, and the name of the person to whom the request shall be sent.
(b) The IPA’s written request for reconsideration shall include sufficient facts to rebut on a point for point basis each deficiency noted in the OSA’s letter of restriction. The IPA may request an opportunity to present in person its written request for reconsideration and provide supplemental argument as to why the OSA’s determination should be modified or withdrawn. The IPA may be represented by an attorney licensed to practice law in the state of New Mexico.
(c) The IPA shall have forfeited its opportunity to request reconsideration of the restriction(s) if the OSA does not receive a written request for reconsideration within 15 calendar days of the date of the letter of restriction. The state auditor may grant, for good cause shown, an extension of the time an IPA has to submit a request for reconsideration.
(2) The OSA shall review an IPA’s request for reconsideration and shall make a determination on reconsideration within 15 calendar days of the IPA response letter unless the IPA has asked to present its request for reconsideration in person, in which case the OSA shall make a determination within 15 calendar days from the date of the personal meeting. The OSA may uphold, modify or withdraw its restriction pursuant to its review of the IPA’s request for reconsideration, and shall notify the IPA of its final decision in writing which shall be sent to the IPA via email and certified mail, return receipt requested.