Ministry of Finances Exposes Severe Losses in Audit of ICE

ICE-Costa-Rica-Telecommunication-Company

The finances of the Instituto Costarricense de Electricidad (ICE) show a decline, especially in the last year.

This was revealed by an analysis by the Ministry of Finance on the financial statements of the entity in the period 2007-2011.

The report notes that last year the Institute closed with a net loss of ¢22.112 million and a rate of profit of -2.1% (that according to the audited financial statement).

This result includes the two business lines ICE: Electricity and Telecommunications. However, the biggest lose comes from the telecommunications sector with a loss of ¢15.061 million in 2011.

This means the proceeds were not sufficient to deal with the costs, operating expenses and other obligations of the company.

In the case of telecommunications, said the analysis, it shows “a decreasing tendency in net profits.”

The report also exposed an increase in total liabilities (debt) of the company, which grew by 184% in four years, and whereas, heritage did by 26% over the same period.

Yesterday, Teofilo de la Torre, chief executive of ICE, said he was concerned about the financial situation but described it as a “little” loss when compared with all the assets of the entity.

However the Institute said that the government undertook to reduce their costs ¢80,000 million at year-end.

The official said they will cut travel expenses, overtime, travel abroad and no more new hires.

In addition, attributed the current financial commitments by opening the telecommunications market.

He said this forced the company to increase its operating expenses, particularly in marketing their brand Kölbi cell. To this is joined by a decline in revenues from sales of services such as Internet and outgoing calls.

De la Torre said that the Regulatory Authority for Public Services (Aresep) itself recognizes their rates, but late.

The document is already under knowledge of the Minister of Environment, Energy and Telecommunications (Minaet), Rene Castro, who had requested the study to the Ministry of Finance.

Castro said yesterday that the Governing Council already formed an interagency commission to inquire about the “worrying deterioration” of the finances of the ICE.

The analysis group is composed officials from the ministries of Finance, Planning, Science and Technology and the Minaet.

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