The Office of the Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Municipality of Peñuelas. A qualified opinion is issued when noncompliance, individually or in the aggregate, is significant but not pervasive.
The Report reveals that Peñuelas formalized five contracts for $45,080 with a corporation not authorized to provide air conditioning and refrigeration system maintenance services. The owner of the corporation and sole corporate officer had a license that had been expired since 2008 and his company was not constituted as a professional corporation as required by Act 164-2009, the General Corporations Act. The audit recommends that the Secretary of Justice consider this situation in order to determine the administrative or judicial actions to be taken.
The three-finding audit notes that, contrary to the contractual provisions, the contractor who won the bid for the construction of an inn-type hotel subcontracted eight companies to carry out the work, totaling $4.4 million, without the written authorization of the Municipality. This situation could have been detrimental to Peñuelas since it deprives the Municipality of evaluating whether the subcontractors meet the necessary experience and requirements, or allows unauthorized persons to provide services.
Contrary to the laws and regulations in force, in Peñuelas there are no written standards or procedures for the receipt, preservation and disposal of the Municipality's documents, and it did not have an inventory or a retention plan for the documents. Our auditors also verified that the Archive had leaks in several walls, one of the air conditioners was out of service, and it did not have an alarm system.
The Report notes that Peñuelas had 204 employees appointed to transitory positions in excess of the regulatory year, for periods extending up to 20 years. In addition, it had two civil lawsuits for $500,000 pending resolution by the courts and did not address the recovery recommendations of $28,389 as published in Audit Report M-17-29 of 2017.
The Peñuelas report covers the period from July 1, 2015 to December 31, 2018
See Audit Report M-20-14.
To see other published reports, visit our Audit Reports section.
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