Fiscal board grants one-time extension for FY2026 obligations

Issues warnings amid ÍntegraPR transition

By THE STAR STAFF

The Financial Oversight and Management Board has granted the Puerto Rico government a one‑time extension to process certain fiscal year 2026 (FY2026) obligations through Oct. 31, but paired the approval with strict conditions and heightened reporting requirements tied to the problematic rollout of ÍntegraPR, the new enterprise resource planning platform.

In an Aug. 28 letter to Office of Management and Budget Director Orlando Rivera Berríos, the oversight board’s executive director, Robert F. Mujica Jr., said the government’s request for additional time stemmed from operational and technical delays caused by the July 7 launch of ÍntegraPR,  the system that integrates core administrative operations, such as finance, human resources and procurement, into a single, centralized software system.

The government argued that the transition slowed the validation and processing of outstanding FY2026 obligations.

The oversight board ultimately authorized the extension for $362 million in encumbered FY2026 obligations -- $226.6 million from PRIFAS, the legacy accounting system, and $135.4 million from other legacy platforms. However, the board noted that data provided for non‑PRIFAS systems lacked detailed account‑string information, limiting its ability to analyze the underlying expenses. That deficiency was flagged as a concern.

In addition to granting the extension, the board issued several warnings. The approval “is granted as a one‑time exception,” the letter states, signaling that similar requests may not be entertained in future fiscal years. The board also ordered the government to implement a system‑level control within ÍntegraPR to ensure that no further processing of the authorized obligations occurs after Oct. 31. Any purchase orders still pending at that time must be placed on hold, cancelled, and reverted by Nov. 30.

The oversight board further warned against improper accounting practices, requiring the government to demonstrate that FY2026 obligations are not being recorded as FY2027 expenditures simply because invoices were processed late. It also directed the government to assess how the extension affects the newly adopted Modified Accrual Accounting Standards Guidelines and the closing of audited financial statements.

To ensure compliance, the board imposed an extensive set of reporting deadlines. By Sept. 15, the government must submit multiple reconciliations and PO‑level reports detailing migrated obligations, account strings, expense concepts, funds, and disbursement activity. Additional biweekly disbursement reports will be required through Nov. 30, including reports as of Oct. 31 and Nov. 30. The government must also confirm by Sept. 30 that the required system control has been configured in ÍntegraPR.

The oversight board emphasized that the extension does not apply to prior‑year appropriations that expired on June 30, federal funds, or items already granted extensions.