(El Nuevo Día)

The active participation of professional associations in the search for solutions to collective problems brings expertise to strengthen decision-making processes and to develop evidence-based public policies. The initiative by the College of Certified Public Accountants to conduct studies aimed at preventing fraud deserves the collaboration of both the public and private sectors.

In 2018, fraud cost the island's productive sectors, including the government, nearly $2 billion, according to the College of Certified Public Accountants estimates. That is almost 3 percent of the gross domestic product. The figure exceeds the loss reported in the United States for both asset misappropriation and corruption rates. This disease that spreads through society can be identified and prevented.

The College indicated that most fraud and abuse cases are associated with the use of cash and that deficiencies related to internal controls contribute to fraud.

According to the College of Certified Public Accountants, no one is exempt from this problem, which can happen in any company in the public, private or non-profit sectors. Knowing the behavior of someone who commits fraud allows developing mechanisms to prevent it. Through a survey of companies and agencies, the College seeks to collect information that will be helpful to advance measures and guidelines towards this goal.

A previous report by the College revealed that the areas with the highest incidence of fraud are the government, banking, and the retail sector. The most common types of fraud were misappropriation of cash, inventory, supplies, and other assets. Other common practices include corruption and manipulation of financial statements.

In 2018, the College recommended implementing internal control mechanisms in businesses and other areas. These mechanisms range from audits and other anti-fraud systems to more strict disbursement and document review processes.

Fraud is, in the first place, a personal decision resulting largely from a lack of ethics and values. Such a character flaw finds support as fraud and corruption become regular in spheres of power such as politics and government. Hence, the model of public and political institutions should represent the highest standards that society aspires to.

Faced with such behavior, it is imperative to adopt stronger greater internal controls. The 2018 report shows that companies with a formal anti-fraud system to receive complaints reported fewer losses and that internal audit is the most effective way to stop fraud. The report includes recommendations such as creating a system to receive complaints in organizations.

Fraud not only drains resources from companies, but it also reduces growth and employment opportunities. It affects goods production and services and undermines opportunities and rights, including health, education, housing, and safety. It also undermines the moral fiber of our society and damages the image of Puerto Rico.

De ahí la importancia de la iniciativa anunciada por el Colegio de CPA, que se une a otras organizaciones profesionales en los esfuerzos de investigar para informar y documentar la toma de decisiones y las políticas públicas.

Therefore, the initiative announced by the College of Certified Public Accountants -which joins other professional organizations in research efforts to inform and document decision-making and public policy- becomes significantly important. Just like the College, other entities that group professionals have been key actors in rapid responses to specific problems, such as the emergency triggered by recent earthquakes in the southwestern region.

With these services to the community, professional organizations show a strong sense of commitment and reciprocity. These initiatives recognize the role of professionals as essential contributors of knowledge and resources for the progress of Puerto Rico.


💬See 0 comments