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The Office of the Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Puerto Rico Aqueduct and Sewer Authority (AAA). A qualified opinion is issued when the instances of noncompliance, individually or in the aggregate, are significant but not pervasive.

The Report reveals that the Authority awarded three regular purchase orders to three suppliers that did not have valid eligibility certifications with the General Services Administration. From a sample of 30 purchase orders to 24 suppliers from 2014 to 2017, it was identified that the aforementioned three suppliers had their certifications expired by up to 22 months in the Certificate History of the Single Registry of Bidders.

In addition, orders were awarded to suppliers that renewed their certifications up to eight months after the last award. In this regard, the AAA also did not complete the Validation Sheet for the suppliers. This situation caused the award of orders totaling $734,029 to suppliers that were not eligible at the time of the award and put the Authority at risk in the event of noncompliance.

The two-finding audit notes that disbursements totaling $362,553 were authorized for goods and services, without the signed evidence of receipt of materials; Form AAA-3, Purchase Order. Some of the goods and services requested were water pumps, chemicals, or electrical equipment.

The five employees responsible for recording in the System the goods and services received indicated that they also did not validate the signatures of the employees who received the goods or services since they recognize the signatures, due to the time they have been working at the Authority. This situation, contrary to the applicable regulation, fosters the environment for the authorization of payments for goods and services not received.

This third report of the AAA covers the period from April 1, 2009 to May 31, 2019.

See the Audit Report CP-21-02

To view other published reports, visit our Audit Reports section.