SF 581 — A bill for an act relating to the auditor of state and including effective date and applicability provisions. (Formerly SSB 1239.)

Senate File 581 - IntroducedReprinted SENATE FILE 581 BY COMMITTEE ON STATE GOVERNMENT (SUCCESSOR TO SSB 1239) (As Amended and Passed by the Senate March 21, 2019) A BILL FOR An Act relating to the auditor of state and including effective date and applicability provisions.

TLSBSF 2771SV581 (2)(3) 88 ec/rnec/rn/mb S.F.

Section 542.3, subsection 20, Code 2019, is amended to read as follows:

20.

“Peer review records” means a file, report, or other information relating to the professional competence of an applicant in the possession of a peer review team, or information concerning the peer review developed by a peer review team in the possession of an applicant.

“Peer review records” includes peer review reports.

Sec.

3.

Section 542.3, Code 2019, is amended by adding the following new subsection:

NEW SUBSECTION .

20A.

“Peer review reports” means a study, appraisal, or review of one or more aspects of a certified public accounting firm’s compliance with applicable accounting, auditing, and other attestation standards adopted by generally recognized standard-setting bodies.

Sec.

4.

However, the requirements of this subsection shall not apply to the office of auditor of state if the auditor of state otherwise complies with the requirements of sectionSF 11.31581 and(3) this88 section.-1- ec/rn/mb 1/3 S.F.

581 section 11.31 and this section.

3.5.

The subject of a peer review may voluntarily submit the final peer review report LSBdirectly 2771SVto (2)the 88board. -1- ec/rn 1/4 S.F.

581 directly to the board.

However, notwithstanding any provision of this subsection to the contrary, peer review recordsreports concerning the office of auditor of state shall be considered a public record pursuant to chapter 22.

4.6.

For purposes of section 542.7, the auditor of state shall beSF deemed581 to(3) be88 the-2- ownerec/rn/mb of2/3 theS.F. office of auditor of state and the office of auditor of state shall be deemed to comply with the ownership requirements of section 542.7 if the auditor of state is a certified public accountant or all divisions of the office of auditor of state performing attest services are led by a certified public accountant.

581 be deemed to be the owner of the office of auditor of state and the office of auditor of state shall be deemed to comply with the ownership requirements of section 542.7 if the auditor of state is a certified public accountant or all divisions of the office of auditor of state performing attest services are led by a certified public accountant.

5.7.

6.8.

EXPLANATIONSF The581 inclusion(3) of this explanation does not constitute agreement with LSB 2771SV (2) 88 -2--3- ec/rnec/rn/mb 2/43/3 S.F.

581 the explanation’s substance by the members of the general assembly.

This bill concerns the office of auditor of state.

Code section 11.31, concerning state auditors, is amended to provide that the auditor of state adopt rules establishing divisions and to provide that for each division that is responsible for performing attest services as described in Code section 542.3, the auditor of state shall appoint a certified public accountant to lead that division.

Code chapter 542, concerning public accountants, is amended.

New Code section 542.7A provides that the office of auditor of state shall qualify as a certified public accounting firm subject to the requirements of Code sections 11.31 and 542.7.

The bill provides that for purposes of applying for a permit as a certified public accounting firm under Code section 542.7, the auditor of state shall be deemed the owner of the office and the office of auditor of state shall be deemed to comply with the ownership requirements of Code section 542.7 if the auditor of state is a certified public accountant or all divisions of the office of auditor of state performing attest services are led by a certified public accountant.

The bill provides that Code section 542.9, concerning appointment of secretary of state as an agent, and Code sections 542.17 and 542.18, concerning client confidentiality, do not apply to the office of auditor of state if the office of auditor of state is issued a permit as a certified public accounting firm.

Code section 542.7, concerning firm permits to practice, is amended.

The bill provides that the requirements of an applicant to register each office of the firm within the state with the Iowa accountancy examining board and to show that all attest and compilation services rendered in this state are under the charge of a person holding a valid certificate do not apply to the office of auditor of state.

In addition, the bill provides that peer review records concerning the office of auditor of state shall be considered a public record pursuant to Code chapter 22.

LSB 2771SV (2) 88 -3- ec/rn 3/4 S.F.

581 The bill takes effect upon enactment and applies retroactively to July 1, 2002.

LSB 2771SV (2) 88 -4- ec/rn 4/4