Comptroller reveals payments of $865 thousand in excess for the purchase of asphalt and multiple deficiencies in the disbursements of the Municipality of Rincón
The Office of the Comptroller of Puerto Rico (OCPR) issued a qualified opinion of the fiscal operations of the Municipality of Rincón. 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 paid $865 thousand in excess of the $170 thousand contracted to acquire asphalt from 2020 to 2022. In fact, of the payments made in excess, $385 thousand correspond to the purchase of asphalt acquired after the expiration date of the contracts.
This situation is attributed to the fact that the municipal administrator did not require the municipal secretary to amend the contracts, that the pre-intervenor did not verify the amount of the purchases, and the municipal buyer also did not reference the contracts in the requisition process. The Report recommends that the mayor recover the amounts paid contrary to the law.
The six-finding audit notes that the Municipality paid $183 thousand for air conditioner maintenance, fumigation, and a use permit services, without having formalized written contracts. Not executing the corresponding contracts causes a distortion of the reality contained in the contracts registries. The Report recommends that the mayor recover this money paid in violation of the Municipal Regulations of 2016.
The auditors identified, from a sample, that the Municipality had made purchases of $160 thousand without obtaining quotes from at least three providers. In addition, purchases of $88 thousand were authorized whose invoices did not contain the certification of absence of interest on the part of the officials and employees of the Municipality. These deficiencies impede free competition and foster the commission of irregularities or errors in the purchasing and disbursement processes.
On the other hand, the Municipality paid $171 thousand for the maintenance, purchase, and installation of air conditioners, without the certification of work performed required by the Act of the College of Refrigeration Technicians of 1970 and the Environmental Policy Act of 2004. In this regard, the Municipality is not certain that these services were rendered in accordance with the laws of the profession.
The person in charge of the property did not perform the annual physical inventory of movable property from 2020 to 2024. This lack of control fosters the improper use or loss of property.
The Municipality did not provide for examination four disbursement vouchers and their supporting documents for $12 thousand issued in 2022 for the payment of professional services. This situation prevented verification of the correctness and propriety of these disbursements.
The Report comments that, as of July 31, 2024, the Municipality of Rincón had not recovered $99 thousand for various concepts published in four audit reports for the years 2015, 2018, and 2021.
Rincón's budget was $8.4 million, $8.1 million, $7.2 million, $7.6 million, and $7.9 million from 2020 to 2024, respectively. The Municipality had its financial statements prepared, which reflected accumulated surpluses of $5.5 million, $6.2 million, $7.5 million, and $10.3 million for the years 2020 to 2023, respectively.
The Report recommends that the director of the Office of Management and Budget ensure that the Municipality complies with the Corrective Action Plan established by the OCPR.
The audit report covers the period from January 1, 2020 to December 31, 2023.
Audit Report OC-25-52 can be obtained on our website: www.ocpr.gov.pr
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