Committee approves SB145 amendment to consolidate federal single-audit reporting for state agencies

The Senate Finance Committee advanced an amended version of SB145 that would consolidate federal single-audit compliance reporting for state agencies under the Department of Finance and Administration (DFA) rather than have each agency file separately. Mark Milhoft (state controller and financial control director) described the amendment’s line edits: clarifying that DFA would 'engage' rather than 'conduct' audits (so the audits themselves remain performed by external auditors or the state auditor), restricting the consolidation to state agencies under DFA oversight (excluding local public bodies), and adding confidentiality language so audits are not released before the state auditor makes releases.

Why it matters: Opponents, including auditing practitioners, warned the consolidation could reduce the number and scope of federal single-audit reviews and weaken compliance oversight. Joe Ortiz, a CPA and audit partner, said the change could be a "slippery slope" that reduces audit coverage and risks fraud, while Audrey Jaramillo told the committee consolidating could reduce the number of audits "from over a 100 audits down to 3–5" for federal major programs, removing local-level alerts. Supporters said the amendment modernizes reporting and aligns New Mexico with other states that do a consolidated federal single audit.

Procedure and outcome: After public testimony and member questions about who audits DFA and which programs remain covered, the committee adopted the amendment and recorded a due-pass recommendation on the amended SB145 by a committee roll-call of 6 in the affirmative and 1 in the negative.

Next steps: The committee directed staff to continue coordination with the state auditor’s office and to ensure external audit procurement and confidentiality provisions are clear; the amendment will be reported to the next stage for further consideration.