Wednesday, August 12, 2020

KPMG Eyes Puerto Rico’s Audited Statements for Fiscal 2015

By on April 15, 2016

SAN JUAN — The Alejandro García Padilla administration is currently evaluating a proposal from KPMG to handle the audited financial reports for fiscal year 2015, Caribbean Business has learned.

The firm is in charge of the commonwealth’s Comprehensive Annual Financial Report (CAFR) for the year ended June 30, 2014—a document that was due nearly a year ago, but has yet to be released.

KPMG also took care of fiscal 2013’s report, which was delivered two months past its deadline. During the past three years, KPMG has been paid roughly $20 million in professional-services contracts, according to government records.

(Photo by Schöning/ullstein bild via Getty Images)

(Photo by Schöning/ullstein bild via Getty Images)

In fact, the island’s last 15 CAFRs have been handled by either KPMG or Deloitte, with each one taking turns depending on the administration. Deloitte has signed off on five of those reports, for periods corresponding to the New Progressive Party, while KPMG has done the same for Popular Democratic Party administrations.

The García Padilla administration had anticipated that Puerto Rico’s audited financial statements for fiscal 2014 would finally be delivered by the beginning of April, but this will no longer be the case after suffering yet another setback, as first reported by Caribbean Business. As of Thursday, La Fortaleza still did not know when the long-awaited report would be released.

With only about two weeks away from the May 2016 deadline to deliver its fiscal 2015 CAFR, it is mostly likely this report won’t be delivered on time either. But how late will the commonwealth be this time?

Earlier this week, Treasury Secretary Juan Zaragoza told Caribbean Business that although people may think the process is doomed to follow the same rocky road as for fiscal 2014, it could be quite a different case. According to his argument, much of the information that is dragging the process out right now would be used for the fiscal 2015 audited statements, which could help complete the process more quickly.

Still, there is no timetable yet for the release of these reports.

During the past decade, and without taking into consideration the fiscal 2014 report that is now almost a year late, Puerto Rico has been late in delivering the CAFR for an average 70 days, or a little over two months, according to municipal market records. Since 2007, the commonwealth has only met the market’s May 1 deadline twice, in fiscal years 2009 and 2010.

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