Comptroller reveals deficiencies in the operations of the Economic Development Corporation of Trujillo Alto
The Office of the Comptroller of Puerto Rico (OCPR) issued a qualified opinion on the fiscal operations of the Economic Development Corporation of Trujillo Alto C.D. A qualified opinion is issued when the noncompliances, individually or together, are significant but not pervasive.
The Report reveals that the Economic Development Corporation of Trujillo Alto C.D. (CDETA) could not provide the OCPR auditors with a copy of the Merchants Registry certificate for five contractors. For their professional and maintenance services, the contractors received 26 payments for $33,146 from 2021 to 2024. In addition, this nonprofit Corporation did not remit to the Special Joint Commission on Legislative Funds for Community Impact copies of 10 informative returns (forms 480) for tax years 2021 and 2022, nor 56 canceled checks for $36,071.
These situations contrary to the Legislative Funds Regulation prevent maintaining administrative control of the disbursements related to the donations, foster the improper use of the funds granted, and may result in the subsidy being suspended.
The six-finding audit notes that the Corporation did not record in its accounting system six electronic transfers for $1,529 of the income tax withholdings. In addition, the Corporation issued 99 purchase orders for $49,369 from the legislative donations account, without the signature of the purchasing officer.
In violation of the current regulation, the Corporation paid $8,109 for educational services without having first registered the contract with the OCPR. In this regard, the auditors also detected that from 2015 to 2024, the Corporation had registered 174 contracts and 4 amendments for $1.1 million with delays of up to six years. The executive director attributed the delays to the administrative burden that exceeded the Corporation's operating capacity and to the fact that it had only three employees.
The Report states that the Corporation's Board of Directors was composed of eight of the 13 required members, did not have an Audit Committee, and did not meet every two months as provided by the Corporate Bylaws. This situation detracts from the authenticity of the agreements and affects financial supervision, transparency, and control of the resources.
The Economic Development Corporation of Trujillo Alto C.D. had a budget of $112,423 in 2020, $118,375 in 2021, $118,375 in 2022, $118,375 in 2023, and increased to $140,400 in 2024. The audited financial statements reflected accumulated surpluses of $3.2 million in 2020, $3 million in 2021, $2.9 million in 2022, and reached $2.7 million in 2023.
The audit recommends that the director of the Office of Management and Budget ensure that the Economic Development Corporation of Trujillo Alto C.D., through the Office of Municipal Management, complies with the Corrective Action Plan established by the OCPR.
The specific-scope compliance audit covers the period from January 1, 2015, to December 19, 2024.
Audit Report OC-25-67 is available on our website: www.ocpr.gov.pr
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