Portimão council and the Lisbon accountancy company Abreu e Cipriano today signed a contract for an audit of the council’s finances between 2009 and 2013.
The management audit of Portimão council aims to result in a report and technical advice on the organisational structure, including procedures, an evaluation of internal control systems, the legality of accounting records, compliance and an analysis of financial statements for the financial years relating to the five year period 2009 to 2013.
The €14,000 contract specifies that the work will be completed within three months and all staff whether permanent or part time will be available for interview.
The priority areas are the organisational structure; forecasting for revenue and expenditure and an analysis of the financial statements over the five-year period.
Gomes already has been sharply criticised for not putting this contract out to tender, something that the audit itself should throw up as a problem area.
It is coming up to a year that Isilda Gomes has been in control of Portimão council and this audit, although welcome, suffers from being long overdue.
Gomes has failed to engage the government in a solution for Portimão’s shattered finances and the suspicion now is that she does not want to release control by applying for a bailout with the attendant supervision and review procedures that would accompany such a move.
The council owes €160 million and remains the only Algarve council left waiting for government help through the PAEL system set up to help councils in dire financial situations.
Gomes has kept vote winning services such as the Vai e Vem bus service, and raised eyebrows earlier this month by announcing a further rise in local taxes to fund a new fire engine.
Portimão residents already pay the highest rates legally permissible, 0.8% for urban buildings and 0.5% for rural properties.
What is needed in Portimão is an explanation of what went wrong, without which Gomes will lack the political support to progress with necessary and unpopular fiscal measures.
Portimão council also faces an extraordinary inspection by the General Inspectorate of Finanças which is looking into the municipal company Portimao Urbis where the ex-Mayor, Deputy Mayor Luis Carito and Councillor Jorge Campos already have been arrested and accused of financial crimes.
This Finanças investigation was to work in coordination with a team of auditors brought in by Mayor Isilda Gomes to unravel the complex workings of the previous administration led for 12 years by the inept Manuel da Luz who left the council in debt by nearly €170 million. There has been no progress report issued and the likelihood is that this audit is not happenening or is going at half speed.
Portimao Urbis now has been wound up and many of its staff taken back in to the council structure. The questions are what happened at Urbis, how much has been stolen, misappropriated and by whom?
Until Gomes gets to grips with the bigger issues, a €14,000 audit into procedures and internal controls is not what is needed. If this is her attempt at clearing up and explaining the mess left by Manuel da Luz, it is not serving the local ratepayers correctly or with integrity.
