[Final Audit Report on the U.S. Fish and Wildlife Service Federal  Assistance Grants Administered by the Commonwealth of Puerto Rico, Department of  Natural and Environmental Resources, from July 1, 2001, through June 30, 2003]
[From the U.S. Government Printing Office, www.gpo.gov]

Report No. R-GR-FWS-0014-2004

Title: Final Audit Report on the U.S. Fish and Wildlife Service
       Federal  Assistance Grants Administered by the Commonwealth
       of Puerto Rico, Department of  Natural and Environmental
       Resources, from July 1, 2001, through June 30, 2003 

  
Date:  September 19, 2005

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AUDIT REPORT

Memorandum

To:  Director, U.S. Fish and Wildlife Service

From:  Andrew Fedak, Director of External Audits

Subject:  Final Audit Report on the U.S. Fish and Wildlife Service Federal 
Assistance Grants Administered by the Commonwealth of Puerto Rico, Department of 
Natural and Environmental Resources, from July 1, 2001, through June 30, 2003 
(No. R-GR-FWS-0014-2004)

This report presents the results of our audit of costs incurred and claimed by 
the Commonwealth of Puerto Rico, Department of Natural and Environmental 
Resources (Department), under Federal Assistance grants from the U.S. Fish and 
Wildlife Service (FWS).  The audit included claims that totaled approximately 
$9.3 million on FWS grants that were open during the Stateï¿½s fiscal years ended 
June 30, 2002 and 2003 (see Appendix 1).  The audit also covered the 
Departmentï¿½s compliance with applicable laws and regulations and FWS guidelines, 
including those related to the collection and use of hunting license revenue and 
the reporting of program income.

We identified unreported program income of $38,577 and found that the Department 
may not have adequate assent legislation. We also found that the Department 
needs to make improvements in its accounting system and license certification, 
grant administration, and asset management processes. 

FWS Region 4 provided a response to the draft of this report dated June 16, 
2005, which included a copy of the Departmentï¿½s June 3, 2005 response to FWS.  
We summarized the FWS and Department responses after the recommendations and 
added our comments regarding the responses. The status of the recommendations is 
summarized in Appendix 3.

In accordance with the Interior Departmental Manual (361 DM 1), please provide 
us with your written response to the recommendations included in this report by 
December 19, 2005.  Your response should include information requested in 
Appendix 3.  If you have any questions regarding this report, please contact Mr. 
Owen Nicholson, Audit Team Leader, or me at (703) 487-5345.

cc:  Regional Director, Region 4, U.S. Fish and Wildlife Service

Introduction

Background

The Pittman-Robertson Wildlife Restoration Act and the Dingell-Johnson Sport 
Fish Restoration Act (Acts) 1 authorize the U.S. Fish and Wildlife Service (FWS) 
to provide Federal Assistance grants to states to enhance their sport fish and 
wildlife programs.  The Acts provide for FWS to reimburse the states up to 75 
percent of the eligible costs incurred under the grants.  However, Puerto Rico 
is exempt from the matching requirements of the Acts.  The Acts also specify 
that state hunting and fishing license revenues cannot be used for any purpose 
other than the administration of the stateï¿½s fish and game agencies.

Scope, Objective, and Methodology

We performed our audit of Federal Assistance grants to the Commonwealth of 
Puerto Rico (Commonwealth) at the request of FWS.  We conducted our audit at the 
Puerto Rico Department of Natural and Environmental Resources (Department) 
headquarters in San Juan, Puerto Rico.  The audit work at the Department 
included claims that totaled approximately $9.3 million on FWS grants that were 
open during the Commonwealthï¿½s fiscal years ended June 30, 2002 and 2003 (see 
Appendix 1). We also visited two natural reserves, three reservoirs, one fish 
hatchery, one State forest, one wildlife refuge, and one boat access facility 
(see Appendix 2).  The objective of our audit was to evaluate:

> the adequacy of the Departmentï¿½s accounting system and related internal 
controls; 
> the accuracy and eligibility of the direct and indirect costs claimed under 
the Federal Assistance grant agreements with FWS;
> the adequacy and reliability of the Departmentï¿½s hunting and fishing license 
fees collection, certification, and disbursement processes; 
> the adequacy of the Departmentï¿½s asset management system and related internal 
controls with regard to purchasing, maintenance, control, and disposal; and
> the adequacy of the Commonwealthï¿½s compliance with the Actsï¿½ assent 
legislation requirements.  

We performed our audit in accordance with the Government Auditing Standards 
issued by the Comptroller General of the United States.  Accordingly, we 
included such tests of records and other auditing procedures that we considered 
necessary under the circumstances.  Our tests included an examination of 
evidence supporting selected expenditures charged by the Department to the 
grants, interviews with employees to ensure that personnel costs charged to the 
grants were supportable, and a review of the Departmentï¿½s use of hunting license 
revenues to determine whether those revenues were used solely for fish and 
wildlife program purposes.  We did not evaluate the economy, efficiency, or 
effectiveness of the Departmentï¿½s operations.

Prior Audit Coverage

On August 4, 1999, we issued audit report No. 99-E-728, ï¿½U.S. Fish and Wildlife 
Service Federal Aid Grants to the Commonwealth of Puerto Rico Department of 
Natural and Environmental Resources, for Fiscal Years Ended June 30, 1995 and 
1996.ï¿½  

We reviewed this report and followed up on all significant findings to determine 
whether they had been resolved prior to our review.  Two findings in this 
report, relating to asset management and accounting system reconciliations, had 
not been resolved satisfactorily and are addressed in the Results of Audit 
section of our report. 

We also reviewed the significant findings relative to the Federal Assistance 
grants addressed in the Departmentï¿½s Single Audit report for the fiscal year 
ended June 30, 2000.   This report also had a finding on accounting system 
reconciliations. 

Results of Audit

We identified the following issues regarding the Departmentï¿½s administration of 
its Federal Assistance program:

A.  Program income of $38,577 was being applied properly but not reported to 
FWS.
B.  The Commonwealthï¿½s assent legislation may be inadequate.
C.  Department accounting system records were not reconciled with the official 
Commonwealth records.
D.  The annual license certification process needs improvement.
E.  Grant administration needs improvement.
F.  Project level accounting was not accomplished.
G  Asset management controls need improvement.

A.  Program Income

The Department earned $75,046 in revenue under grant No. F-42-3, but reported 
only $36,469 as program income on the Financial Status Report (SF-269).  The 
income was generated by angler surveys conducted by Department staff under its 
Federal Assistance program.  The surveys were also sent to a contractor that 
maintained a fisheries database for a federal agency that had a similar program, 
and the contractor paid the Department for each survey it used in its database. 

According to 43 CFR ï¿½12.65, program income is gross income received by a grantee 
directly generated by a grant-supported activity.  Program income should be 
deducted from total grant costs to determine net costs on which the grantorï¿½s 
share will be based or, with FWS approval, added to the project funds to further 
eligible program objectives or used to meet the cost sharing or matching 
requirement.  In addition, the grant agreement should include an estimate of 
program income anticipated for the grant period.

The payments received from the contractor did not always include information on 
the period covered.  Because there are several factors that influenced the 
amount of income earned and when it was received, FWS Region 4 advised the 
Department to apply program income received after the end of the grant period to 
the next yearï¿½s grant or another Sport Fish grant.  The Department properly 
applied program income in accordance with the FWS guidance but did not report 
income received after the end of the grant period that was not applied to the 
grant. 

As a result, the Department did not report $38,577 of program income from 
fishing surveys completed under grant No. F-42-3.  

Recommendation

We recommend that FWS resolve the issue on how program income received after the 
grant period should be reported for future grants. 

Department Response

The Department concurred with the finding, provided a detailed explanation of 
the situation, and stated that it submitted to FWS a revised Financial Status 
Report for grant No. F-42-3 showing the program income applied, and a plan for 
how it will use the balance.  The Department further stated that in the future, 
all program income would be reported on the final Financial Status Reports.    

FWS Response

FWS stated that it concurred with the finding and recommendation.

OIG Comments

While both FWS and the Department concurred with the finding, FWS did not state 
whether it agreed with the Departmentï¿½s response or whether it had received and 
approved the revised Financial Status Report.  Therefore, additional information 
is needed concerning the actions taken or planned to resolve the finding and 
implement the recommendation.  This information should be included in the 
corrective action plan.

B.  Assent Legislation

Puerto Rico has passed laws (in Spanish) for the conservation of fish and 
wildlife; however, it appears that it has not passed legislation assenting to 
the Restoration Acts.  

Both the Pittman-Robertson Wildlife Restoration Act and the Dingell-Johnson 
Sport Fish Restoration Act require that before any monies are apportioned to a 
State under the Acts, the State must pass legislation which assents to the 
provisions of the Acts, and shall have passed laws for the conservation of fish 
and wildlife that include a prohibition against the diversion of hunting and 
fishing license fees paid by hunters and sport fishermen for any purpose other 
than the administration of the State game and fish agency.

The Department worked with FWS to develop laws for the conservation of fish and 
wildlife and to require that revenues from the sales of hunting and fishing 
licenses be used only for fish and wildlife programs.  Therefore, Department 
officials believed that the laws complied with all of the requirements of the 
Acts.   

If the Commonwealth has not passed legislation that assents to the Restoration 
Acts, it may not be entitled to receive funds apportioned under the Acts.  

Recommendations

We recommend that FWS determine whether:

1.  The laws passed by the Commonwealth constitute adequate assent legislation.

2.  The Department may continue to participate in the Federal Assistance 
program.

Department Response

The Department did not concur with Recommendation 1 and stated that the 
Commonwealth has passed two laws that it believes comply with the requirements 
of the Restoration Acts.  The Department provided a detailed explanation of the 
two laws and their requirements for the conservation of fish and wildlife and 
the creation of special funds to manage the associated programs.  The Department 
further stated that the Audit Guide ï¿½does not establish that the assent of the 
State with relation to the federal legislation must be expressed.ï¿½

FWS Response

FWS stated that it concurred with the finding and recommendations and commented 
that it will consider the Departmentï¿½s response by determining whether the 
language in the Puerto Rican statues complies with the Restoration Acts.

OIG Comments

Regarding the Departmentï¿½s comment on the Audit Guide, the purpose of the Guide 
is to provide guidance on conducting Federal Assistance audits, and it does not 
have the same authority as laws or regulations.  The assent requirement is 
contained in the Restoration Acts and the Code of Federal Regulations (50 CFR ï¿½ 
80.3).  The regulation states, ï¿½A State may participate in the benefits of the 
Act(s) only after it has passed legislation which assents to the provisions of 
the Act . . .ï¿½ 

While FWS concurred with the finding and recommendation, it stated it would need 
to review the laws to determine whether they comply with the requirements of the 
Restoration Acts.  Therefore, we consider that finding unresolved and the 
recommendations not implemented.

C.  Accounting System Reconciliation 

Our prior audit report identified inadequacies with the Departmentï¿½s accounting 
system, including the inability to reconcile the accounting records maintained 
by the Departmentï¿½s federal funds accountant with the accounting records 
maintained by the Puerto Rico Treasury Department (the official accounting 
records).  The report recommended that the Department develop written policies 
and procedures for the accounting of federal funds by grant consistent with 
State accounting.  The Department concurred with the recommendation and 
indicated it would develop written policies and procedures to establish a 
comprehensive accounting system that could be reconciled with Treasury 
Department records.  However, ï¿½The Manual of Procedures for the Registration of 
Federal Funds Received by the Department of Natural and Environmental Resourcesï¿½ 
(Manual), which was prepared in response to the recommendation, states:

ï¿½As of the date of this Manual (January 2004) a system that will facilitate the 
integration of the register kept by the Department of Natural and Environment 
Resources (DNER) with the financial information included in the PRIFAS (Puerto 
Rico Integrated Financial Accounting System) has not been implemented.  

We understand that it is necessary to establish an accounting system for the 
federal funds in the DNER that will facilitate all the procedures described in 
this Manual and at the same time will integrate how each financial transaction 
will be included in a General Ledger that can be reconciled with the financial 
information presented in the PRIFAS system.ï¿½

In addition, the Departmentï¿½s Single Audit for the year ending June 30, 2000, 
indicated that the Departmentï¿½s accounting system did not provide reasonable 
assurance that the accounting records were complete and included all significant 
transactions when compared with reports issued by the Treasury Department.  

In accordance with 43 CFR ï¿½ 12.60, ï¿½a State must expend and account for grant 
funds in accordance with State laws and procedures for expending and accounting 
for its own funds.  Fiscal control and accounting procedures . . . must be 
sufficient to:

* Permit preparation of reports required by this part and the statutes 
authorizing the grant; and
* Permit the tracing of funds to a level of expenditures adequate to establish 
that such funds have not been used in violation of the restrictions and 
prohibitions of applicable statutes.ï¿½  

This condition resulted from inadequate management and inconsistent application 
of the accounting and financial reporting controls and procedures.  

Accordingly, the Department did not have assurance that the information reported 
on its Financial Status Reports was consistent with the actual cost data 
contained in the official accounting records because the Departmentï¿½s accounting 
records used to prepare the reports were not reconciled to the official 
accounting records.  As a result, the Department and FWS did not have assurance 
that financial data was accurate, complete, and reliable to make informed 
administrative decisions and to determine compliance with applicable laws, 
regulations, and grant requirements.  

Recommendation

We recommend that FWS require the Department to establish a comprehensive 
accounting system that can be reconciled with the financial information 
presented in the PRIFAS. 

Department Response

The Department concurred with the finding regarding the need to reconcile 
financial information.  The Department also stated, however, that the lack of 
reconciliations was due mainly to the lack of adequate staff and not to the lack 
of an adequate accounting system.  The Department added that it has requested 
funds to contract for an accounting assistant to reconcile the financial 
information.  The Department also stated the current system is providing for the 
preparation of all required financial reports.

FWS Response

FWS stated that it concurred with the finding and recommendation.

OIG Comments

While the FWS concurred with the finding and recommendation, it did not state 
whether it agreed with the Departmentï¿½s response or identify specific actions 
that would be taken to address the recommendation.  Therefore, additional 
information is needed concerning the actions taken or planned to resolve the 
finding and implement the recommendations.  This information should be included 
in the corrective action plan.

D.  Hunting License Certifications

The Department completed and submitted annual License Certifications for license 
years (LYs) 2003 and 2004 for hunting licenses sold.  We reviewed these 
certifications and found minor errors were made in counting and reporting the 
total licenses sold.  

According to 50 CFR ï¿½ 80.10, the number of persons holding paid licenses to hunt 
or fish for sport or recreation shall be furnished to the Director of the U.S. 
Fish and Wildlife Service and shall be certified as accurate by the director of 
the State fish and wildlife agency.  

The Department used a combination of computer-generated data and manual counting 
procedures to derive the total number of hunters holding paid licenses that was 
reported in the annual certification.  The reporting errors were minor, and 
resulted from simple addition errors and, in one case, duplicate reporting of 
one group of licenses.  Better controls over the process should eliminate these 
types of errors. 

We were told that the Department has been authorized to sell recreational 
fishing licenses, and that the potential license sales could far exceed the 
number of hunting licenses sold.  While the current license certification 
process may be adequate (with improved controls) for the volume of hunting 
license sales (about 400 a month), the process would be cumbersome for a 
significantly larger activity. The Department is currently exploring various 
options related to license sales data gathering and revenue collection.  With 
that in mind, the need for a process to achieve an accurate count of licenses 
sold, including the elimination of duplicate license holders should be addressed 
promptly. 

Recommendations

We recommend that FWS:

1.  Work with the Department to develop appropriate processes and procedures to 
ensure that the number of fishing and hunting license holders reported in the 
annual certification is accurate. 

2. In the interim, require the Department to establish controls to ensure the 
accuracy of the number of hunting license holders reported in the annual license 
certifications. 

Department Response

The Department concurred with the finding but stated that due to the small 
amount of hunting licenses sold (fishing licenses are not currently sold) the 
errors were not significant.  The Department added that it would begin selling 
fishing licenses later this year and would be implementing a Point of Sales 
system by June 2006.  In the interim, the current system will be evaluated and 
improved to avoid errors.

FWS Response

FWS stated that it concurred with the finding and recommendation.

OIG Comments

While the FWS concurred with the finding and recommendation, it did not state 
whether it agreed with the Departmentï¿½s response or identify specific actions 
that would be taken to address the recommendation.  Therefore, additional 
information is needed concerning the actions taken or planned to resolve the 
finding and implement the recommendations.  This information should be included 
in the corrective action plan.

E.  Grant Administration  

During the course of our audit, we noted that for 38 of the 47 grants open 
during the audit period, either the performance periods were extended or 
extensions to file final Financial Status Reports were approved by FWS.  We also 
observed that 33 of those grants did not expend all grant funds.  In discussions 
with FWS personnel, we were told that the Department has reverted $450,000 of 
funds over several years.  FWS was concerned that the Department could revert up 
to $750,000 of its sport fish and wildlife apportionments if grant funds were 
not expended as approved.  

The Department and FWS approve each grant agreement based on an identified need, 
the project objectives, and the expected results or benefits.  The project 
objectives detail what is to be accomplished and specify the funding, staffing 
resources, and performance period.  The FWS Service Manual (522 FW 2) also 
requires the Department to accomplish planned work within the grant agreement 
period.  

We inquired as to why grant objectives could not be accomplished without time 
extensions.  We were told that there were administrative impediments, including 
the following:

* A cumbersome requisition process required up to seven approvals for purchases, 
even though the Accounting Manual we were provided required only four approvals.  
Our review of 52 purchases found an average of 68 elapsed days between the 
requisition date and the purchase order issuance, and an average of 74 days 
elapsed between the purchase order date and receipt of the item ordered.

* Upper management officials did not approve requisitions for grant-related 
equipment and travel requests for grant-related seminars and conferences. These 
disapprovals resulted in multiple submissions of requisitions to gain approval, 
appropriation of equipment from other projects to accomplish grant objectives, 
and missed opportunities for Department staff to obtain guidance and training 
needed to accomplish grant-related program objectives effectively.

* The Department did not hire employees critical to accomplishing grant 
objectives and approved in grant agreements; the lack of staff contributed to 
the Departmentï¿½s inability to accomplish grant-related work without time 
extensions.  

These conditions could jeopardize accomplishment of Federal Assistance grant 
objectives and result in the reversion of grant funds.  

Recommendation

We recommend that FWS work with the Department to establish procedures that 
eliminate impediments to accomplishing grant objectives within the grant period.  

Department Response

The Department concurred with the finding and stated that the procedure for 
acquisition of goods and services was being redesigned to require a maximum of 
five signatures.  In addition, after being informed of the situation, the 
Governor directed all agencies to fill all vacant positions that have federal 
funds approved. 

FWS Response

FWS stated that it concurred with the finding and recommendation.

OIG Comments

While the FWS concurred with the finding and recommendation, it did not state 
whether it agreed with the Departmentï¿½s response or identify specific actions 
that would be taken to address the recommendation.  Therefore, additional 
information is needed concerning the actions taken or planned to resolve the 
finding and implement the recommendation.  This information should be included 
in the corrective action plan.


F.   Project Level Accounting

Several grants were comprised of projects2, each of which had a separate budget.  
However, the Department did not accumulate the actual costs of these projects 
for comparing actual costs to the corresponding budgeted amount.  Other grants 
had written approval to accumulate costs at the grant level, so there was no 
requirement to accumulate costs by project on those grants.  The following 
grants with a Federal share exceeding $100,000 did not have the approval:

Grant No.
Description
Grant Amount/
Federal Share
F-16-14
Freshwater Fisheries Investigations 
$148,090

F-19-12
Sport Fish Activities - Guanica
142,710

F-19-13
Sport Fish Activities - Guanica
112,237

F-27-12
Evaluation of Boat Anchor Damage
158,894

F-27-13
Evaluation of Boat Anchor Damage
301,852

F-29-11
Sport Fish Activities ï¿½ Lucchetti 
193,761

F-29-12
Sport Fish Activities ï¿½ Lucchetti 
192,355

F-34-11
Sport Fish Activities - Guajataca
171,931

F-35-7
Maricao Fish Hatchery O & M
151,638

F-35-8
Maricao Fish Hatchery O & M
439,952

F-47-1
Sport Fish Activities ï¿½ La Plata
377,555

FW-1-32
Sport Fish & Wildlife Coordination
266,943

FW-8-10
Sport Fish & Hunting - Boqueron 
122,850

FW-8-11
Sport Fish & Hunting - Boqueron 
109,794

W-15-12
Monitoring Game Bird Population
135,451

W-21-4
Population Densities Columbids
190,141

W-23-1
Avian Conservation - Karstic
143,132

W-23-3
Avian Conservation - Karstic
133,486


     Totals
$3,492,772

 
While 43 CFR ï¿½12.70 generally allows grantees to re-budget within the approved 
direct cost budget to meet unanticipated requirements, certain types of post-
award budget changes require the prior written approval of the awarding agency.  
For non-construction projects, 
43 CFR ï¿½12.70 (c) requires grantees to obtain the prior approval of the awarding 
agency when the following is anticipated:  ï¿½(ii) Unless waived by the awarding 
agency, cumulative transfers among direct cost categories, or, if applicable, 
among separately budgeted programs, projects, functions, or activities which 
exceed or are expected to exceed ten percent of the current total approved 
budget, whenever the awarding agencyï¿½s share exceeds $100,000.ï¿½

Department officials were aware of the requirement but indicated that 
accumulating and monitoring grant expenditures at the project level would be too 
cumbersome because the agreements were complex and usually included several 
projects.  In addition, they indicated that the budgeted amounts were only used 
when a project was not completed and the corresponding amount was to be deleted 
from the grant.   

Since the actual costs of each project were not accumulated or monitored, there 
was no assurance that the amount budgeted for a specific project was an accurate 
representation of the funds necessary to accomplish the work required.  In 
addition, there was no way to verify whether the budgeted amounts were exceeded 
or whether more than 10 per cent of the total grant amounts were transferred 
between projects within a particular grant without the prior approval of  FWS.  

Recommendation

We recommend that FWS notify the Department that it should accumulate and 
compare actual costs to the amounts budgeted for individual projects within the 
applicable grant agreements and follow the requirements of 43 CFR ï¿½12.70.
   
Department Response

The Department stated that it did not entirely concur with the finding 
contending that the grants for which FWS requested accounting at the project 
level were single projects although separately budgeted by jobs.  The Department 
also stated that its accounting system did not provide for accounting at a level 
lower than grant level. 

FWS Response

FWS stated that it concurred with the finding and recommendation.

OIG Comments

While FWS concurred with the finding and recommendation, it did not state 
whether it agreed with the Departmentï¿½s response or identify specific actions 
that would be taken to address the recommendation.  Therefore, we consider the 
finding unresolved and the recommendation not implemented.

G.  Asset Management

Using the Departmentï¿½s computerized inventory listing for Federal Assistance 
personal property,3 which included the property identification number, cost, 
description, location, and grant project number, we inspected property at seven 
sites4 and the Department headquarters in San Juan.  The Property Division, 
under the Auxiliary Secretary of Management Affairs, maintained the inventory 
listing.  Separate inventory listings were maintained for vehicles, boats, and 
boat trailers.  With the assistance of the staff at each location, we inspected 
a sample of items to determine whether the items existed, were in useable 
condition and properly tagged, or whether they were disposed of properly.  Based 
on our inspections, we concluded that the Departmentï¿½s Federal Assistance 
property inventory listing is inaccurate and incomplete.  

The Manual requires that property records must be kept that have the following 
information:

* description
* serial number or other identification number
* source of funds used to purchase the equipment
* who has title
* date of acquisition
* cost
* percentage of Federal participation in the cost
* location, use, and condition
* data regarding disposal
 
The Manual also requires a physical inventory be taken once every 2 years, the 
results of that inventory be reconciled to the Departmentï¿½s inventory records, 
and a copy of the inventory results and the reconciliation be provided to the 
Federal agency that provided the acquisition funds.  

According to 50 CFR ï¿½ 80.19, the State must maintain current and complete 
property records in accordance with requirements contained in the Service Manual 
and OMB Circular Aï¿½102.  In addition, the State is responsible for the 
accountability and control of all assets to assure that they are used for the 
purpose for which they were acquired throughout their useful life (50 CFR 
ï¿½ 80.18).

The inventory records were inaccurate and incomplete because the Department did 
not update them based on the results of the physical inventories or other 
records maintained for grant property.  

The Department provided an inventory listing for Federal Assistance property 
that identified 648 items valued at $371,997.  However, we found that the value 
of 61 of these items was not shown on the inventory listing.  In addition, we 
found that the Department inventory did not include all tagged items.  

The Federal Assistance Coordinator provided site inventory records that 
contained 815 items for 8 grant projects.  We compared those inventory records 
to the corresponding Department inventories and found that 529 of the 815 items 
(with assigned property numbers) were not on the Department inventory, as shown 
below.  





On Dept
On Site





On Dept
On Site  
Inventory
Inventory
Items  
Not
Not
Grant
Site
Inventory
Inventory
Not on Site
Not on Dept
Sampled
Tagged
Found
FW-10
Humacao
3
30

27
25
5

F-19
Guanica
12
64

52
38
17

F-29
Lucchetti
107
148

41
25
3

F-47
La Plata
12
37

25
20
4

F-34
Guajataca
90
138
2
50
31
2

F-8
Boqueron

126

126
22
2

F-35
Maricao
124

124

39
2

F-9
HQ ï¿½ Fish
8
168

160
3


F-16
HQ ï¿½ Fish
93

93

23
4

F-24
HQ ï¿½ Fish
18

18

18

1
W-15
HQ - Wildlife
56

56

17


W-21
HQ - Wildlife
62
104
6
48
17
1
3

   Totals
585
815
299
529
278
40
4

As shown above, we selected a sample of 278 items for review using the 
Department and site inventory listings.  Of the items sampled, we could not find 
4 items at the location indicated in the Departmentï¿½s inventory records, 40 
items were not tagged, and 2 items had a property identification number 
different from the number in the Departmentï¿½s records.  

Our review of the site inventories identified at least 174 items listed as 
damaged or ï¿½to be decommissioned.ï¿½  We inquired as to why these items had not 
been disposed of and were told that once an item was added to the inventory it 
was not removed until the item was inspected and the Commonwealthï¿½s Treasury 
Department concurred with the determination.  The Treasury Department charges 
for these services.

We also found discrepancies with the inventory listings for vehicles, boats, and 
boat trailers.  We found that 23 vehicles listed on site inventories did not 
appear on the Departmentï¿½s vehicle inventory listings.  In addition, there 
appeared to be inconsistencies in tagging these items.  Our inspections showed 
that some vehicles were tagged or had the property identification number painted 
on the vehicle, and others, mostly newer items, did not.  In addition, while 
most items had individual property identification numbers, there were three 
instances where multiple items shared the same identification number, such as a 
boat, trailer, and motor at the Humacao Natural Reserve and a tractor, mower, 
and back hoe at La Plata Reservoir.  There was no official explanation why this 
happened, but the staff assisting us speculated that items sharing the same 
identification number were probably purchased at the same time.  

As a result, we concluded that the Department does not have effective control 
over its personal property to ensure that assets purchased with Federal 
Assistance funds are utilized solely for the purpose for which they were 
acquired.   

Recommendation

We recommend that FWS require the Department to conduct a physical inventory of 
its personal property, including reconciliations of its inventory records with 
those maintained at the Departmentï¿½s natural reserves and other sites, and 
update the personal property inventory based on the results.

Department Response

The Department concurred with the finding and agreed that the inventory was not 
complete and there were inconsistencies in tagging of the equipment.  The 
Department further stated that a new inventory system will be purchased by 
December 31, 2005, and that a complete inventory is underway and will be 
completed by September 30, 2005.

FWS Response

FWS stated that it concurred with the finding and recommendation.

OIG Comments

While the FWS concurred with the finding and recommendation, it did not state 
whether it agreed with the Departmentï¿½s response or identify specific actions 
that would be taken to address the recommendation.  Therefore, additional 
information is needed concerning the actions taken or planned to resolve the 
finding and implement the recommendation.  This information should be included 
in the corrective action plan.

Appendix 1

PUERTO RICO DEPARTMENT OF NATURAL AND ENVIRONMENTAL RESOURCES FINANCIAL SUMMARY 
OF REVIEW COVERAGE

Grant
Grant
Outlays
Number
Amount
SFY 02/03
F-9-15
$257,764

$172,297

F-9-16
323,407

172,575

F-16-14
148,090

115,440

F-16-15
197,705

183,880

F-19-12
142,710

89,753

F-19-13
112,237

81,154

F-19-14
111,569

68,672

F-24-12
148,939

147,913

F-24-13
167,290

161,021

F-27-12
158,894

151,295

F-27-13
301,852

217,381

F-28-12
23,090

23,090

F-28-13
24,240

24,240

F-29-11
193,761

180,740

F-29-12
192,355

183,992

F-34-11
171,931

111,337

F-34-12
252,618

216,024

F-35-7
151,638

178,324

F-35-8
439,952

445,354

F-36-10
209,405

95,501

F-39-9
28,560

2,771

F-39-10
29,910

20,841

F-42-3
254,248

244,467

F-45-1
1,697,557

1,869,459

F-46-1
55,000

51,560

F-47-1
377,555

56,488

FW-1-32
266,943

211,072

FW-1-33
331,784

310,416

FW-8-10
122,850

72,083

FW-8-11
109,794

123,191

FW-8-12
168,244

184,697

FW-10-6
171,418

158,797

FW-10-7
186,182

254,297

W-13-13
18,420

14,695

W-13-14
18,420

15,575

W-14-12
83,899

79,108

W-14-13
72,894

62,488

W-15-12
135,451

94,137

W-21-4
190,141

136,121

W-21-5
255,974

144,423

W-21-6
336,131

277,459

W-22-3
85,330

85,330

W-22-4
85,330

85,330

W-23-1
143,132

143,132

W-23-2
133,486

133,484

W-23-3
133,486

66,742

W-24-1
102,290

51,919


$9,323,876

$7,970,065



Appendix 2

PUERTO RICO DEPARTMENT OF NATURAL AND ENVIRONMENTAL RESOURCES SITES VISITED

Natural Reserves
Humacao
Tortugero Lagoon

Reservoirs
Guajataca
La Plata
Lucchetti

Other Sites
Boqueron Wildlife Refuge
Catano Boat Ramp
Guanica State Forest
Maricao Fish Hatchery


Appendix 3

COMMONWEALTH OF PUERTO RICO, DEPARTMENT OF NATURAL AND ENVIRONMENTAL RESOURCES 
STATUS OF AUDIT FINDINGS AND RECOMMENDATIONS


Recommendations:  B.1 and B.2 

Status:  Finding Unresolved and Recommendations Not Implemented

Action Required:  Provide a corrective action plan that identifies the actions 
taken or planned to resolve the findings and implement the recommendations. The 
plan should also include the target date and the official responsible for 
implementation of each recommendation.  The unimplemented recommendations 
remaining at the end of 90 days (after December 19, 2005) will be referred to 
the Assistant Secretary for Policy, Management and Budget for resolution and/or 
tracking of implementation.

Recommendations:  A, C, D.1, D.2, E, F, and G

Status:  Management Concurs; Additional Information Needed

Action Required:  Provide a corrective action plan that identifies the actions 
taken or planned to resolve the findings and implement the recommendations, as 
well as the basis for any disagreement with the recommendations.  The plan 
should also include the target date and the official responsible for 
implementation of each recommendation.  The unimplemented recommendations 
remaining at the end of 90 days (after December 19, 2005) will be referred to 
the Assistant Secretary for Policy, Management and Budget for resolution and/or 
tracking of implementation.