AECOM Energy and Construction, Inc. - Contract No. 8273

At the request of the Tennessee Valley Authority (TVA), we performed an audit of costs paid by TVA to AECOM Energy and Construction, Inc. (AECOM) for engineering services under Contract No. 8273. The contract provided for TVA to compensate AECOM for work on either a cost reimbursable or fixed price basis. Our audit objective was to determine if the costs were billed in accordance with the terms and conditions of the contract. Our audit scope included about $21.6 million in costs paid by TVA from January 1, 2016, to April 30, 2018.In summary, we determined AECOM overbilled TVA $287,346, including (1) $235,437 in labor costs, (2) $27,010 in subcontractor costs, (3) $11,742 in fee, (4) $9,682 in travel costs, <br> (5) $2,050 in materials costs, and (6) $1,425 in fixed price costs. Additionally, we noted issues with TVA's contract administration including (1) inadequate oversight of the fee evaluation process, (2) markup rates not included in the contract, and (3) activity on closed purchase orders. (Summary Only)