Comptroller reveals $173 thousand disbursement in Luquillo without obtaining quotes or certification of work performed
The Office of the Comptroller of Puerto Rico issued a qualified opinion on the fiscal operations of the Municipality of Luquillo. 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 Municipality did not obtain quotes from at least three representative market suppliers for 17% of the purchase orders examined. As a result, the Municipality had no alternatives available for the goods and services acquired for $154,401, such as debris removal, pest-control netting, repair of air-conditioning units, or rental of popcorn machines.
The auditors detected quotes prepared up to 40 days after the purchase order and quotes without the name of the bidder. These situations, contrary to the 2020 Municipal Code, are attributed to the purchasing director not adequately supervising the buyers' functions.
In addition, for the air-conditioning repair and maintenance services for $18,900, the Municipality did not require the contractor to provide the certification of work performed required by Act No. 36 and by Act 416-2004. In this regard, the Municipality has no certainty that the services were rendered in accordance with the laws, and is exposed to being fined.
The two-finding audit notes that the check-delivery register included the signature of whoever received the check but not the name, and checks were delivered without identifying the recipient. These deficiencies foster the commission of irregularities and make it difficult to verify the propriety of the disbursements.
The Report comments that as of June 30, 2023, six civil lawsuits for $11,499,500 were pending resolution by the courts. In addition, a case regarding recruitment and selection was pending resolution before the Public Service Appeals Commission.
The Municipality of Luquillo had a budget of $7,483,767; $8,009,244; $8,006,044; $7,687,127, and $7,900,312 from fiscal years 2019 through 2023, respectively. The financial statements reflected accumulated surpluses of $2,274,104; $1,875,719; $2,506,029; $668,015; and $2,865,828, from fiscal years 2018 through 2022, respectively.
The audit recommends that the director of the Office of Management and Budget ensure that the Municipality of Luquillo complies with the Corrective Action Plan established by the Office of the Comptroller of Puerto Rico.
This second report covers the period from July 1, 2018 to June 30, 2023
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Audit Report OC-25-41 is available on our website: www.ocpr.gov.pr.
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