Contract Compliance Audit - Nol-Tec Systems, Inc

The OIG audited $4.8 million in costs billed to the Tennessee Valley Authority (TVA) by Nol-Tec Systems, Inc., to design, furnish, and install hydrated lime injection systems for SO3 mitigation at various TVA fossil plants. Our objective was to determine if the costs billed to TVA for the period January 1, 2011, through September 19, 2012, were in compliance with the terms and conditions of the contract.We found Nol-Tec overbilled TVA $292,678, including (1) $150,147 of ineligible sales commissions, (2) $89,155 of ineligible labor costs, (3) $39,878 for a duplicate payment made by TVA, and (4) $13,498 of ineligible subcontractor markup costs. Summary Only