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Comptroller of Puerto Rico reveals deficiencies in administrative controls and legal compliance in audit of CODEVISA

San Juan, Puerto Rico, (April 20, 2026) – The Comptroller of Puerto Rico, Attorney Carmen A. Vega Fournier, reported the results of Audit Report OC-26-19, corresponding to the Corporation for the Business and Cultural Development of the Islet of San Juan (CODEVISA), which covers the period from January 1, 2016 to December 31, 2024.

The report contains a qualified opinion, having determined that, although the operations examined were carried out in all significant aspects in accordance with the applicable law and regulations, relevant findings were identified related to purchases, contracting of external audits, and compliance with reporting and certification requirements.

The Comptroller explained that the audit evaluated the use of public funds, including federal grants, legislative appropriations, and municipal contributions, as well as the effectiveness of internal controls and compliance with the legal provisions applicable to a special municipal corporation. She indicated that the results evidence deficiencies in key areas of administration, documentation, and supervision that require corrective actions.

Regarding the first finding, the audit identified deficiencies in the purchasing processes carried out with a legislative appropriation of $50,000 granted in December 2022 for the development of a community center in the Islet of San Juan. It was determined that, of seven payments made for a total of $33,812 between May and June 2023, six payments for $30,378 were made without obtaining the two quotations required for all the items acquired. In addition, in three payments for $14,174 the corresponding invoices were not supplied, with only quotations being found in the files. These deficiencies limited free competition among suppliers and affected the integrity of the documentation required for oversight and accountability purposes.

The report attributes these deficiencies to the lack of personnel, including the vacancy of the purchasing officer position during the audited period, and to deviations from the regulatory provisions on the part of executive management. In its comments, the Municipality of San Juan held that it is not part of CODEVISA's management nor does it have control over the use of the legislative funds. For their part, the vice president of the Board and the executive director indicated that the efforts were documented and that the invoices were available. Nevertheless, the Office of the Comptroller concluded that the finding prevails, having evidenced the absence of required quotations and complete documentation in the files.

In the second finding, it was determined that CODEVISA failed to comply with the established terms for the contracting of external audits of its financial statements for fiscal years 2022-23 and 2023-24. As of June 30, 2024, there were delays of up to 456 days in the contracting of these services, which caused the entity not to have timely and updated financial information for decision-making and could affect the allocation of public funds.

Among the causes of this situation are changes in the Board of Directors, difficulties in obtaining proposals from external auditors, and noncompliance with the applicable regulatory provisions. The Municipality reiterated that it has no control over the internal processes of the corporation, while CODEVISA's management acknowledged the delay and indicated that some financial statements have already been completed and audit services have been contracted for subsequent years. However, the Office of the Comptroller determined that the finding prevails.

The third finding reflects significant noncompliance with the Audit of Governmental Entities Act of 2003 and other provisions related to the rendering of reports. The audit determined that CODEVISA did not submit the required annual certifications to the Office of the Comptroller for fiscal years 2015-16 to 2023-24. Likewise, 15 monthly payroll and position reports corresponding to the period from February 2023 to April 2024 were not sent, with delays of up to 458 days,
and 67 reports were submitted with delays that fluctuated between 5 and 467 days.
These deficiencies limited the availability of updated information for citizens, the Government, and oversight processes.

In its comments, CODEVISA's management argued that, as an independent nonprofit corporation, certain reporting requirements did not apply to it. Nevertheless, the Office of the Comptroller determined that the finding prevails, establishing that every entity that receives public funds in excess of $200,000 is obligated to comply with said legal requirements, regardless of its legal nature.

Among the main recommendations are ensuring compliance with the corrective action plan, strengthening purchasing processes through the obtaining of required quotations, maintaining complete files with the corresponding fiscal documentation, complying with the timely contracting of external audits, and designating a liaison officer responsible for submitting the certifications and reports required by law within the established terms.

It is indispensable that all entities that manage public resources fully comply with their legal and administrative responsibilities, without exception,” concluded the Comptroller.

The complete report is available on the official page of the OCPR www.ocpr.gov.pr.