Comptroller reveals multiple deficiencies in the fiscal operations of Morovis
The Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Municipality of Morovis. A qualified opinion is issued when the noncompliances, individually or as a whole, are significant but not pervasive.
The Report reveals that the Municipality of Morovis did not submit to the consideration of the Municipal Legislature the lease contracts for municipal compactor trucks and for the municipal lot to two solid waste collection companies. For these leases the Municipality received income of $423,785 from 2017 to 2022. This situation had the effect that the Legislature could not evaluate the necessity, propriety, and reasonableness of the contracts.
In addition, one of the companies used four compactor trucks, property of the municipality, for the collection of solid waste, without formalizing written contracts. Due to this situation, contrary to current legislation, the interests of the Municipality were not protected.
The seven-finding audit notes that the Municipality paid $14,400 for the wooden construction of two observation towers, whose expert evaluation concluded that they were overvalued by $8,000. In addition, it paid $2,044 in excess of the load capacity and for a duplicate invoice, to suppliers of vegetative material collection after the passage of Hurricane María.
From 2019 to 2022, the Internal Audit Unit of the Municipality of Morovis did not conduct audits in the areas of purchases, biddings, or on the accounting system, among others. The lack of oversight in these areas of materiality and risk deprives management of necessary information about municipal finances and operations. The Municipality also did not conduct the annual physical inventory from 2021 to 2022 as provided by the Municipal Regulation of 2016.
The law provides that, in case of loss or irregularity, the Municipality has 20 days to conduct an investigation and 10 additional days to report the situation to the Office of the Comptroller of Puerto Rico (OCPR). From 2019 to 2022, the Municipality did not conduct administrative investigations in 10 incidents of property loss and theft, nor did it report to the Comptroller about nine accidents of municipal vehicles and two thefts of money. In fact, the Annual Certification of Notification of Losses or Irregularities for fiscal years 2019 to 2022 were submitted up to four years late, with the signature of the mayor on May 22, 2024.
The auditors identified that no written rules or procedures for the receipt, conservation, and disposal of the Municipality's documents had been approved as of June 6, 2023. In addition, the official designated as administrator of public documents had her special appointment revoked on two occasions at the request of the Institute of Culture (ICP), given that she did not comply with her obligations and responsibilities. Another municipal employee was designated as administrator of public documents, but also did not complete the trainings required by the position, for which reason the ICP did not extend her appointment.
In violation of the Code of Federal Regulations 2, the Municipality awarded with delays of up to 14 months, the contracts to perform the audits of the financial statements for fiscal years 2019 through 2023. In addition, the Municipality submitted to the OCPR, with delays of up to 27 months, the annual certifications of the Contractual Standards Act on Independence in Audits of 2003.
The Government, the Office of the Comptroller, and the citizenry did not have updated information on the Municipality's operations as required by law, due to the delays in the submissions of reports and certifications from 2019 to 2022 to the OCPR. For example, the certifications to comply with the Contract Registry Act were sent more than two years late; the certifications to comply with the Act on the Status of Privatizations were sent more than three and a half years late; and 36% of the position registries to comply with the Act for Fiscal Reform were sent with delays of up to six months.
The audit recommends that the Office of Management and Budget ensure that the Municipality of Morovis complies with the Corrective Action Plan established by the Office of the Comptroller.
This first report of Morovis covers the period from January 1, 2019, to December 31, 2022.
The Audit Report OC-24-64 can be obtained on our website.
Some documents on this page are saved in PDF format.
To view these documents, you must have the following free program installed.
