Review of Hartsville Inventory

We conducted a review to determine whether TVA 's inventory management system, PassPort, accurately reflected the reported $14.3million in inventory housed at the Hartsville facility as of December20, 2006. We compared PassPort data to physical inventory on hand for 93 catalog identification numbers (CAT IDs). We found PassPort accurately reflected the location and quantity on hand for 89, or 95.7percent, of the CAT IDs selected for review. We also compared inventory on hand for 38 judgmentally selected CAT IDs to PassPort and found, (a) inventory held for use was commingled with surplus materials and (b) materials were not always accurately reflected, or were excluded, in PassPort. According to Procurement, it was waiting on plant direction for the disposition of several materials housed at Hartsville, including some items corresponding to the CAT IDs we reviewed. Management agreed with our findings and has taken or plans to take appropriate corrective action.