The Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the municipality of Corozal. A qualified opinion is issued when the noncompliance items, individually or together, are significant, but not pervasive.
The Report reveals that the Municipality contracted, for inspection tasks at the Cine Teatro de Corozal, the same professional engineering services corporation that prepared the design and plans for the reconstruction. The Joint Regulation for Construction Works and Land Use of 2010 prohibits the designer of a work from acting as its inspector.
The inspection contract of $62,400 increased to $198,900 after nine amendments that were also executed in violation of the regulations in effect. This situation was referred in 2018 to the president of the College of Engineers and Land Surveyors of Puerto Rico, so that it may take the measures it deems pertinent.
The six-finding audit notes that the municipality acquired vehicles and heavy equipment, such as a tractor, a loader, and a golf cart, among others, without obtaining the required quotes. The mayor and two officials, who traveled to the auction in Kissimmee and in Orlando, Florida, did not protect the interests of the municipality and the expenses, including the trip, amounted to $98,809. This situation made it impossible to determine whether the amount invested in the acquisition was lower than the local market price, and whether the municipality had better-offer alternatives at its disposal.
The auditors detected multiple deficiencies in disbursement vouchers and their supporting documents such as: absence of original invoices, lack of dates or of authorized signatures. In addition, the municipality paid $1,159 in financing charges on the credit card assigned to the mayor.
The Report indicates that 89% of the credit transfers were made without the director of Finance issuing the surplus certifications. A similar situation had been commented on in Audit Report M-15-27 of 2015.
Contrary to Act 81-1991, the Autonomous Municipalities Act, the Internal Audit Office of Corozal had not carried out periodic audits that included the areas of materiality and risk. In addition, the Purchasing Regulation and the Credit Card Use Regulation had not been adjusted to the new provisions of Act 81-1991, nor to the Regulation for Municipal Administration of 2016.
The audit comments that the Municipality settled, for $1 million, a lawsuit by 17 former employees for political discrimination. In addition, the Court of Appeals confirmed the sanction imposed by the Office of the Independent Prosecutor Panel of suspending the mayor from employment and salary for 10 days, for having used municipal employees and equipment to pave a private road leading to his residence.
The municipality of Corozal incurred overdrafts in 20 municipal funds amounting to $1.3 million according to the Monthly Report of Revenue and Disbursements. In addition, as of January 27, 2020, the municipality had 35% of its temporary employees with appointments that exceeded the legal term of one year.
The Report covers the period from January 1, 2014 to June 30, 2017.
See Audit Report M-20-31.
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