In little less than a month, New Mexico taxpayers as well as financial experts will get their first look at what the heck happened at the New Mexico Finance Authority (NMFA) when a fraudulent audit plunged the agency into one of the biggest financial controversies in state history.

State auditor Hector Balderas told members of the NMFA Board on Monday morning (Oct. 22) that his office will release to board members and the public at large preliminary findings from independent audits into the controversy that has led to criminal charges, threats of lawsuits and jeopardized the state’s bond rating.

NMFA Board meeting, 10/22/12

“I’m excited that come mid-November the public will have some hard financial information that they can draw their own determination on how sound the NMFA is in terms of its practices and its finances,” Balderas told Capitol Report New Mexico after he briefed the board members at their monthly meeting in Santa Fe.

Balderas didn’t give an exact date for the release of the preliminary findings but when the announcement comes, it will mark the first time since the scandal broke in July that results from independent sources can begin to determine the extent of the problem.

Right now, there are three separate audit reviews being conducted to determine how the bogus audit managed to get filed in the first place, why it didn’t get caught earlier and how far off the the faked numbers are from the actual numbers. It’s crucial, in the wake of the scandal, for the state to maintain the confidence in Wall Street ratings agencies such as Moody’s and Standard & Poor’s because should they downgrade the state’s bond rating it will cost taxpayers millions in higher interest rate charges.

“All my resources will be committed to getting the reviews out,” Balderas told the board Monday and the NMFA chief financial strategist Michael Zavelle told members the result of the review is “likely to be the most scrutinized document in New Mexico for the next five years.”

Important questions hang in the air but there’s cautious optimism the state can avoid a downgrade.

“Our accounting staff has looked at it and they don’t see any anomalies there,” NMFA acting chief executive officer John Gasparich said after Monday’s meeting.

“Once everything is back I’m hoping [the ratings agencies] will just look at our audit, look at everything else in place that will not have changed and they presumably won’t have any reason to downgrade us,” Gasparich said.

Update: A spokesman for Moody’s in New York City told Capitol Report New Mexico that on Oct. 10 the ratings agency gave the NMFA a second, 90-day extension on making a decision on the authority’s bond status. The extension will give Moody’s time to assess the preliminary numbers that come out in mid-November.

When asked if the ongoing forensic audits indicate the faked numbers roughly correlate with the actual numbers, Balderas said it would be premature to comment s until the prelimary figures come out.

For background on the faked audit and its fallout, click here.