Senate passes bill allowing state agencies to hire private accountants

The Iowa Senate approved a bill Monday allowing state agencies to employ private accountants to conduct annual audits instead of the state auditor’s office.

Iowa Auditor Rob Sand and Democrats opposed the measure, arguing it will decrease government accountability.

Senate File 2311 passed 31-16 and it moves to the House for consideration. Sen. Mike Bousselot, R-Ankeny, said the legislation would bring the auditing practices of Iowa local governments to state government, allowing private certified public accountants to conduct audits. He said this flexibility will help Iowa complete its yearly financial audit on time by drawing on outside resources to make up for the shortage of CPAs in the state.

“The bottom line is that Iowans deserve better,” Bousselot said. “That innovation and efficiency can occur by leveraging national firms, CPA firms, that have extended expertise (and) can draw on a national footprint of independent, nonpartisan, certified public accountants, do so in a cost-effective way that delivers value for taxpayers — just like local government does.”

Democrats objected to his framing of reasons why the Iowa Auditor of State’s annual reports have been late. Sen. Janice Weiner, D-Iowa City, suggested Republicans contact Gov. Kim Reynolds’ office and “ask why they didn’t respond to requests for documents in a timely manner.”

Weiner also said the bill’s proposal for state government audits by private CPAs differs from those done by Iowa cities and school districts, as it would not give the auditor’s office the same oversight powers — like the ability to reaudit or conduct special investigations — that are in place for local government audits.

“This bill might as well be entitled ‘A bill for an act to incentivize graft and corruption,'” Weiner said.

Though Weiner, as well as auditor’s office staff, said the measure will restrict the auditor from reviewing state government audits conducted by private CPAs, Bousselot said Iowa Code states these audits can be “checked at any time” by the auditor. He also disagreed with arguments that the bill would result in more corruption, citing the private CPA used by the Iowa Finance Authority “for years without rampant corruption or fraud.”

Democrats also argued the measure was politically motivated, as Sand is the only Democrat to currently hold elected statewide office in Iowa. Sen. Tony Bisignano, D-Des Moines, linked the bill with a 2023 state law that limited the auditor’s ability to access to certain information and barred the auditor from going to court for subpoena enforcement against state elected officials and government entities.

Sand said in a news conference last week that the 2023 law was cited by the Iowa Board of Parole when the auditor’s office requested documents related to a whistleblower report.

Bisignano called the private CPA bill a “cheaper attempt” by Republicans to diminish the power of the state auditor. He said the auditor’s office was accountable to the people of Iowa as an elected official, and that the restrictions on the office were attempts to remove the checks and balances on the state because of his political affiliation.

“You have the audacity to come back into this chamber and try to neuter the auditor, so the people of Iowa cannot see the daylight on the budgets and the expenses that’s happening in the state,” Bisignano said.

Bousselot denied claims that the bill was politically motivated and said it was about “good, accountable government.”

“Only in politics can the hiring of an independent, nonpartisan certified public accountant be accused of being political,” Bousselot said.

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