The Office of the Comptroller reveals control deficiencies in the fiscal operations of Isabela
The Office of the Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Municipality of Isabela. A qualified opinion is issued when the noncompliances, individually or together, are significant but not pervasive.
The Report reveals that two interagency agreements and an amendment for $52,800, between the Municipality of Isabela and the Department of Correction and Rehabilitation, were registered with the Office of the Comptroller up to 13 months after they were formalized. These agreements to pay salary differentials to employees on assignment were submitted to the Office in 2023, after the auditors requested the information as part of the audit. This situation has the effect that public documents were not accessible to the public within the required time.
The three-finding audit notes that, as of May 11, 2022, the bank reconciliations of two special accounts that the Municipality opened in January and February 2021 had not been prepared. By regulation, bank reconciliations must be prepared every month. This deficiency does not allow the Municipality to have updated, complete, and reliable information on its financial situation and the result of its operations.
The Municipality of Isabela submitted 16 records of the Monthly Payroll and Positions Report for 2021 and 2022 to the Office of the Comptroller up to eleven months later. The law, the current regulations, and eleven circular letters provide, among other things, that the entity has up to 30 consecutive days, after the end of the month, to submit this report. Failing to keep up with the submission of the monthly reports fosters a lack of transparency and confidence in the Municipality.
The budget of Isabela amounted to $12,574,756, $12,598,876, $12,923,693, and $16,123,255, from 2019 to 2022, respectively. The Municipality had its financial statements prepared, which reflected accumulated surpluses of $35,114,667, $35,075,447, and $35,482,345, from 2019 to 2021, respectively.
The audit recommends to the director of the Office of Management and Budget that he ensure that the Municipality of Isabela complies with the Corrective Action Plan of the Office of the Comptroller of Puerto Rico. This first report of Isabela covers the period from September 1, 2019, to June 30, 2022.
The Audit Report OC-25-09 can be obtained on our website: www.ocpr.gov.pr.
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