Petition

1. Section 11.6.3 of the Code of Iowa states a township or city for which audits are not required may contract with or employ the auditor of state or a certified public accountant for an audit or examination of its financial transaction and condition of its funds.  

2. The following entities are not covered by this section: 

   • Cities with a population of over 2,000.

   • Community School Districts. 

   • Non-governmental entities such as a Chamber of Commerce, Economic Development Corporations, separate legal entries such as a Fire Association, Booster Clubs, or similar organizations.  

1. The petitioners submit the original petition to the City or Township.  It does not have to be at an open meeting.  They can present it to the City or Township Clerk who can then present it to the governing body.  It is the prerogative of the City or Township official receiving the petition whether he/she wants to provide a receipt documenting the date the petition was received.  The City is required to forward the petition to AOS so a determination can be made whether the petition warrants an audit or examination. 
2. Because the City may not comply with this requirement, the petitioners should send a copy of the completed petition forms, including the date the petition was filed with the City Council or the Township Board, so that we may monitor the status of the petition request.  In addition, the petitioners should submit a separate written summary of specific concerns to be used in the determination of whether an audit or examination is needed and to assist the auditors when planning the audit or examination.  The letter is NOT required to be filed with the City Council or Township Board.

1. 11.6.3 states “Upon receipt of an application requesting an audit by one hundred or more taxpayers, or if there are fewer than six hundred sixty-seven taxpayers in the township or city, then by fifteen percent of the taxpayers, the township or city shall forward a copy of the application to the auditor of state for a determination of whether the auditor of state will require an audit or examination.”
2. Taxpayers is not defined by the Code.  Because of the difficulty on getting data and verifying the number of taxpayers, the Office of Auditor of State uses the total population as of the last census.  This provides a conservative approach as the population may be less than the number of taxpayers.

Based on the above the following is the process for calculating the number of required signatures.

• If the City or Township’s population exceeds 667, the petitioners are required to obtain a minimum of 100 signatures.   (Iowa Code 11.6.3)
• If the City or Township’s is less than 667, the petitioners are required to obtain signatures equaling 15% of the population based on the most recent census. (Iowa Code 11.6.3)
• For items A or B, because there is the possibility signatures may be removed (either by request of the individual or as the result of a protest by the entity), the petitioners should obtain more signatures than the minimum required if possible.

The Code specifies “taxpayer” signature.  As noted above, the Code does not define Taxpayer.  As a result, the office has defined a\ taxpayer as any individual who routinely pays tax in the community, such as property tax, taxes on utilities, and gas tax.  This allows renters, business owners, and rural individuals  with a City address, to sign the petition. This is how the Census Bureau addresses rural residents. This does NOT mean the governing body cannot protest a signature of an individual.  As stated above the individual signing the petition must be at least 18 years of age.

Each member of the household (at least age 18) can sign the petition and be counted individually.  For example, a husband and wife are counted as 2 signatures.  Each MUST sign independently.  If a wife signs both her name and her husband’s name, that is considered only 1 signature.

The petition containing the signatures itself is a public document, and a copy must be provided to anyone requesting it.  However, the concerns and the initial petitioner (the individual who requested the petition forms) remains confidential per section 11.42 of the Code of Iowa, even after completion of the engagement.

An individual may remove his/her signature by submitting a signed and dated written request to the Office of Auditor of State.  This must be done “practically concurrently” because there is no defined open period.  The Office of Auditor of State cannot arbitrarily delay the petition process in the event a citizen comes forward.

Yes.  However, this must be done within a reasonable timeframe after submission of the petition.  In addition, the petitioner is only afforded 1 additional opportunity.  If, after the 2^nd attempt, the petition does not have the required number of signatures, the petitioner must start over and submit a new petition.

No. Because the intent of the party is clear, a petition for audit or examination is not invalidated by an incorrect citation.

No, Iowa Code section 11.6(3) states the Auditor of State determines whether the auditor of state will require an audit or an examination. A summary of concerns is required to be submitted with the petition to assist in making this determination.  As stated previously, the concerns are confidential.

1. If the Auditor of State determines an Audit is required to meet the petitioners' concerns, the entity must use the RFP process to hire a CPA firm to perform the audit.  As part of the notification process, a notification letter is sent to the entity when the petition for an audit is received.  The letter requires the entity to notify the Auditor of State whether the entity intends to hire AOS or use the RFP process.  A copy or a Sample RFP is included with the notification letter.

If the entity selects a CPA firm, we work closely with the CPA firm regarding the petitioners’ concerns.

2. If the Auditor of State determines an examination will address the petitioners' concerns, AOS will perform the examination because it is not possible for CPA firms to bid on the engagement without disclosing the petitioners’ concerns.  In addition, it is not appropriate to have firms bid on engagements without full disclosure of all needed procedures. If the auditor of state determines that an examination may be conducted instead of an audit, the Auditor of State shall determine the scope of the examination.
3. If the entity fails to hire a firm in a timely manner (60 days) and cannot provide sufficient reason for the delay, the Office of Auditor of State may conduct the audit.

Yes.  However, current practice is the audit or examination is conducted for the most recent fiscal year completed with the understanding documentation from previous fiscal years or the current period may be reviewed if a concern is identified which warrants further investigation.

1. As stated in Chapter 11.6.3, a petition is for an audit or examination of the entity’s financial transactions and condition of its funds. 
2. A petition cannot address items such as:
   1. Personal actions, unless there is evidence of misuse of public funds or financial irregularities,  
   2. Budgeting or other management decisions made by the City Council or Board.  A petition can request we review the budget process for compliance with the Code of Iowa.
   3. Finances related to an individual or private business.
3. However, Citizens may include items which are of importance to the taxpayers of the entity for consideration. 

1. No.  Once the petition and letter of concerns are submitted no additional items can be added as part of the petition. However, if information is received that clarifies or supports a concern on the initial letter, it maybe considered. For example, copies of resolutions minutes, or other documents.
2. In addition, items received prior to the petition are also excluded from consideration unless the information clarifies or supports a concern in the letter filed with the petition.

As stated in Chapter 11.6.3, payment for the audit or examination shall be made from the proper public funds of the township or city. At the completion of the audit or examination, a bill is submitted to the entity for payment  

Yes.  The City Council/Township Trustee meeting agenda can state: “Closed session, pursuant to Chapter 21.5(1)(a) and Chapter 11.42 of the Code of Iowa requiring confidentiality, to review responses for audit.”  The closed session may then be followed by an action item stating: “Approve audit responses.” 

No. Extension requests are not required for petition audits or examinations.

1. No.  The petitioners may create their own petition form as long as the following information is included in the petition:
   • Signature
   • Address
   • Date signed.
2. The petitioners may also create their own letter but should include the following:
   • Entity Name
   • Date
   • Issues to be considered.
   • Brief explanation of the issue
   • Copies of documents (if available)

1. Once the report is a matter of public record, a news release is provided to the press.  A copy of the complete report is posted to the Office of Auditor of State’s website.  A copy is also provided to the entity and available for inspection by the public. 
2. A copy of the issued report will be provided to the original petitioner only.  The petitioner may then notify others a copy is available on our website or provide copies to other concerned citizens

No. Chapter 11.42.1 of the Code of Iowa states, “information received during the course of an audit, including allegations of misconduct or noncompliance, and all audit or examination work papers shall be maintained confidential.” 

The following are examples of areas we cannot address.If you are not sure a specific concern can be address as part of a petition, please contact the office with the area you are concerned with.

• Medicaid/ Medicare payments to individuals or entities.  For questions related to Medicaid / Medicare please contact the Iowa Department of Health and Human Services.
• Individual taxes (income tax, sales tax)).  For questions related to personal income and sales tax questions, please contact the Iowa Department of Revenue.Property tax valuations and assessments. For questions related to property tax valuations and assessments, please contact your County Assessor’s Office.
• Child support payments
• Utility rates.  We arto e able address if the Council followed the proper ordinance process.
• Tax rates set by levy or by other governing bodies.
• Criminal fines, penalties, and sentences.
• Removal of elected officials from office.
• Consumer complaints.
• Election results or voter registration. Please contact your local election officials or the Secretary of State.

1. Section 11.6.4 of the Code of Iowa states the auditor of state may at any time cause to be made a complete or partial reaudit of the financial condition and transactions of any governmental subdivision, or an office of any governmental subdivision.
2. Chapter 11.1 defines a Governmental Subdivision.
   • “Governmental subdivision” means cities and administrative agencies established by cities, hospitals or health care facilities established by a city, counties, county hospitals organized under chapters 347 and 347A, memorial hospitals organized under chapter 37, entities organized under chapter 28E, community colleges, area education agencies, and school districts.”
3. Reaudits can be performed only over those Governmental Subdivision required to have an annual financial statement audit or an annual examination.
4. The following entities are not covered by this section:
   • Fair Boards / Associations are not required to be audited.
   • Examples of non-governmental entities such as a Chamber of Commerce, Economic Development Corporations, separate legal entries such as a Fire Association, Booster Clubs, or similar organizations. If you are unsure if the entity is subject to reaudit, please contact our office.

Under Chapter 11.6.4 of the Code of Iowa - A reaudit may be performed if any of the following conditions exists.

1. The auditor of state has probable cause to believe such action is necessary in the public interest because of a material deficiency in an audit of the governmental subdivision filed with the auditor of state or because of a substantial failure of the audit to comply with the standards and procedures established and published by the auditor of state.
2. The auditor of state receives from an elected official (emphasis added) or employee of the governmental subdivision a written request for a complete or partial reaudit of the governmental subdivision.

The auditor of state receives a petition signed by at least one hundred eligible electors of the governmental subdivision requesting a complete or partial reaudit of the governmental subdivision. If the governmental subdivision has not contracted with or employed a certified public accountant to perform an audit of the fiscal year in which the petition is received by the auditor of state, the auditor of state may perform an audit required by subsection 1 or 3.

1. The petitioners submit the original petition to the Auditor of State.   
2. In addition, the petitioners should submit a separate written summary of specific concerns to be addressed along with the petition.
3. A request or the Petition may be submitted via email: PetitionsAndReaudits@aos.iowa.gov

or Mail us at:

Office of Auditor of State

Room 111

State Capitol Building

Des Moines, Iowa 50139

1. The petitioners are required to obtain a minimum of 100 signatures.
   • However, If the entity has a population under 667, then the guidance for obtaining signatures under Iowa Code Chapter 11.6.3 applies. 
   • If the Entity’s population is less than 667, the petitioners are required to obtain signatures equaling 15% of the population based on the most recent census. (Iowa Code 11.6.3)
   • Because there is the possibility signatures may be removed (either by request of the individual or as the result of a protest by the entity), the petitioners should obtain more signatures than the minimum required if possible.

Each member of the household (at least age 18) can sign the petition and be counted individually.  For example, a husband and wife are counted as 2 signatures.  Each MUST sign independently.  If a wife signs both her name and her husband’s name, that is considered only 1 signature.

The Code specifies “eligible electors of the governmental subdivision.”.  In practice, this means all signatures must be from individuals in the community who are or could be registered voters in the community to be reaudited.

Although the petition itself is a public document, it may not be considered an “open” record.  Per discussion with the Auditor of States Chief of Staff, in July 2022, a public record is not always an open record.  We must evaluate the request for a copy of the petition under section 22.7(18) of the Code of Iowa, which may exempt it from being disclosed.  However, the concerns and the initial petitioner are always considered confidential per section 11.42 of the Code of Iowa, even after completion of the engagement. 

An individual may remove his/her signature by submitting a signed and dated written request to the Office of Auditor of State.  This must be done “practically concurrently” because there is no defined open period.  The Office of Auditor of State cannot arbitrarily delay the petition process in the event a citizen comes forward.

Yes.  However, this must be done within a reasonable timeframe after submission of the petition.  In addition, the petitioner is only afforded 1 additional opportunity.  If, after the 2^nd attempt, the petition does not have the required number of signatures, the petitioner must start over and submit a new petition.

No. Because the intent of the party is clear, a petition for reaudit is not invalidated by an incorrect citation.

Yes. The Code requires the Office of Auditor of State to perform the reaudit.

No.  A reaudit covers the most recently completed financial statement audit or annual examination.  However, during the course of the reaudit, if a concern is identified, reaudit procedures will be performed over previous fiscal years or subsequent fiscal years as deemed necessary to fully address the concern.

No.  Once the petition and letter of concerns are submitted no additional items can be added as part of the petition. In addition., concerns received prior to the petition are also excluded from consideration. All concerns should be included in the letter submitted with the petition or request for reaudit.

No cost is billed to either the entity or the petitioners for a reaudit. The Cost is covered by the Office of Auditor of State.   

Yes.  The Entity meeting agenda can state: “Closed session, pursuant to Chapter 21.5(1)(a) and Chapter 11.42 of the Code of Iowa requiring confidentiality, to review responses for audit.”  The closed session may then be followed by an action item stating: “Approve audit responses.” 

1. No.  The petitioners may create their own petition form as long as the following information is included in the petition:
   • Entity to be audited
   • Signature
   • Address
   • Date signed.
2. The petitioners may also create their own letter but should include the following:
   • Entity Name
   • Date
   • Issues to be considered.
   • Brief explanation of the issue
   • Copies of documents which may be helpful in making a decision (if available)