On Tuesday, May 10, 2005, Governor Bush signed into law HB 349 relating to local government auditor selection procedures by Rep. Fred Brummer (R-Apopka).  It will become effective July 1, 2005.

HB 349 and SB 1072 sponsored by Sen. Jeff Atwater (R-North Palm Beach) were drafted by recommendations of a 26-member task force appointed by the Auditor General that had representatives from nine different organizations including the FICPA.  Both bills passed all of their committees and the House and Senate floors unanimously.

Among other issues, this bill:

• Revises procedures for the selection of financial auditors by local governmental entities;

• Provides for the use of a Request for Proposal to secure audit services and clarifies the role of audit committees;

• Establishes certain minimum requirements to be used in the evaluation of audit services, contract negotiations, and auditor selection procedures; and

• Requires the use of written contracts for audit services and provides that auditor contracts may be renewed.

The most significant portion of the legislation is a fundamental policy shift to require the establishment of certain minimum factors to use in evaluation of audit services, contract negotiation, and auditor selection procedures, and provide that audit fees cannot be considered the “sole or predominant” factor in evaluating RFPs. Other recommendations from the task force include the concept of developing a “best practices” guide for the use by local governments in the area of the procurement of audit services, auditor selection, audit management, key contract elements, and similar items.

To view the full bill text, please click here.

Thank you to all who participated in this task force as well as Jim Dwyer and Ted Sauerbeck from the Auditor General's Office.  Without their expertise, this legislation could not have been possible.