Fisher Contracting Company - Contract No. 13155

As part of our annual audit plan, we audited costs billed to the Tennessee Valley Authority (TVA) by Fisher Contracting Company (Fisher) under Contract No. 13155 for coal combustion residual construction services. Our audit objectives were to determine if (1) costs were billed in accordance with the terms of the contract and (2) tasks were issued using the most cost efficient pricing methodology. Our audit scope included about $47.9 million in costs billed to TVA from February 12, 2018, through February 28, 2022. This included approximately $42.5 million for fixed price projects, $5.3 million for cost reimbursable projects, and $89,985 for time and material projects. In summary, we determined:Fisher overbilled TVA $80,324, including (1) $48,183 for overbilled labor costs, (2) $23,383 for duplicate material costs, (3) $7,758 for ineligible equipment costs, and (4) $1,000 for ineligible insurance costs.The use of fixed price payment terms on projects caused TVA to pay at least $4.35 million more than it would have if cost-reimbursable payment terms had been used for those projects. Additionally, if TVA utilized cost-reimbursable pricing for the remaining contract spend, it could potentially avoid $28.7 million in future costs.(Summary Only)