PROCESS OF THE CITIZEN COMPREHENSIVE DEBT AUDIT

WHY AUDIT?

  1. To find out the truth about what happened.
  2. To learn how we got into this crisis and reached this level of indebtedness.
  3. To evaluate the constitutionality and legality of each public debt issuance over the past 40 years.
  4. To analyze the role of financial actors throughout the crisis, including the local and federal government.
  5. To identify those responsible.
  6. To know how public funds were used and whether the public benefited.
  7. To recommend measures to prevent this crisis from happening again.

WHO AUDITS?

The Citizen Commission for the Comprehensive Audit of Public Credit:
The Commission is a non-profit organization created to conduct a citizen comprehensive audit of the public debt on behalf of the people of Puerto Rico.

 

The Commission represents people like you and me and is composed of:

 

17 members representing different sectors and interests:

 

Economy
Finance
Statistics
Constitutional Law
Planning
Unions
Business
Cooperatives
Planning
Public Education
Pensioners
Public University System
Public Health
Environment
Gender
Culture and Arts
Public Housing
Agriculture

 

THE COMISSION’S OBJECTIVES:

 

The Commission will evaluate 40 years of public debt issuance and the role of all actors involved in the management of these public funds, including the government.

The Commission has the responsibility to audit all of Puerto Rico’s public debt, including the processes of public indebting, the results, and any related issues or controversies.

 

 

KEY AUDIT STANDARDS:

 

Legality: To verify that the use of public debt for goods and operations is in compliance with constitutional, legislative and legal requirements.

 

Quantity: To verify the total sum of public debt today and within specific past intervals.

 

Guarantees: To identify opportunities to improve existing guarantees that prevent excessive indebting in the future.

 

NECESSARY ELEMENTS:

 

Financial resources: To build a necessary team of legal and auditing professionals.
Independence: To conduct the citizen debt audit without impediments, conflicts of interest or organizational restrictions.
Transparency: Promote broad citizen participation and transparency via internet transmissions, public hearings, data open sources, webpage and communities talk throughout Puerto Rico.

HOW TO AUDIT?

The integral audit is composed of four different investigative processes:

 

1. Financial Audit: determines how much is owed in principal and interest payments.

 

2. Forensic Audit: ldetermines the legality of each bond issued.

 

3. Compliance Audit: valuates the performance of public and private actors involved and financial institutions’ actions.

 

4. Performance Audit: evaluates how public funds were used.

6 PHASES:

1. Planning, recruitment and monitoring

Recruiting personnel
Meeting and submitting audit papers for review
Creating an inventory of the debt and compliance management attributes to test

2. Initial evaluation and risk assessment

Initial discovery through interviews and document requests
Initial profile of key characteristics of the debt
Risk evaluation based on key determinants
Procedure to determine potential fraud
Initial report with hypothesis and work plan

3. Implementation of the audit

Review the totality of public debt
Test hypothesis developed during review
Prepare draft report
Public conferences to present results
Solicit, evaluate and respond to public comments
Present final report with modifications based on received and accepted commentary

4. Writing and presenting the results

Prepare the draft report
Public conferences to present results
Solicit, evaluate and respond to public comments
Present final report with modifications based on received and accepted commentary

5. Ongoing Work

Project management and supervision

6. Post-audit

Assistance with implementation

HOW MUCH DOES IT COST TO AUDIT?

 

We need your donation to raise the funds to cover the cost of a professional legal and audit team capable of directing an audit of this magnitude.
The estimated time and cost to complete all phases of the audit are 37,000 labor hours at a total cost of $5.6 million.

In order to begin PHASE 1, we need to raise $500,000

PHASE 1:

 

  • Forensic and compliance audit

  • 4 bond issuance

  • 6 months-1 year duration

  • Public hearings, reports and community presentations

 

 

CONTACTO