Federal Reports

The audit objectives were to determine whether program funds were managed in accordance with the ARC and Federal grant requirements.

Our Objective(s)To perform a quality control review (QCR) of Allmond & Company, LLC's audit of the Great Lakes St. Lawrence Seaway Development Corporation's (GLS) financial statements as of and for the fiscal year ended September 30, 2025. We reviewed Allmond's report, dated January 7, 2026, and related documentation.
About This ReportWe contracted with the independent public accounting firm Allmond & Company, LLC to audit GLS's financial statements, provide an opinion on those financial statements, report on internal control over financial reporting, and report on compliance with laws and other matters.
What We FoundThe independent auditor, Allmond, found one significant deficiency in GLS's internal controls over financial reporting:

Incorrect unit costs resulted in misstatement of the balance of operating materials and supplies.

Our QCR disclosed no instances in which Allmond did not comply, in all material respects, with U.S. generally accepted Government auditing standards.
RecommendationsWe agree with Allmond's five recommendations to help strengthen GLS's internal controls over financial reporting.

The independent public accounting firm of Allmond & Company, LLC, under contract with the Office of Inspector General, audited the EAC’s financial statements for the fiscal year ended September 30, 2025. The purpose of this letter is to convey information concerning control weaknesses that did not rise to the level of a significant deficiency or material weakness.

Demand Response (DR) programs offer incentives for electric utility customers to reduce their energy use during peak demand which reduces the need for generation and helps offset market purchases during times of peak cost.  TVA is expanding its portfolio and plans to invest more than $1.5 billion in its Energy Efficiency and DR programs from fiscal year (FY) 2024 through FY 2028.  Due to the risk of TVA’s investment not meeting the anticipated reduction in energy needs, we performed an evaluation to determine if TVA's investment in DR programs was delivering intended benefits. 

While the Demand Management (DM) organization increased the DR curtailment capacity, they did not meet the targets for FY 2024 or FY 2025. The curtailment capacity achieved was 27 percent less than planned in FY 2024 and 23 percent less than planned in FY 2025.  We identified two contributing causes for not achieving the DR program targets for curtailment capacity:  (1) the planned increases in DR capacity were set before some new and redesigned programs were completed, which resulted in inaccurate estimates; and (2) there were challenges with implementation and adoption of new and redesigned DR programs that impacted achievement of the goal.  Not achieving the planned curtailment capacity could result in increased cost to TVA.  Planned curtailment capacity is included in TVA’s strategy to meet demand.  If DM does not achieve its goals, TVA could be required to meet the demand with purchased power.  Since DR programs are mainly used when demand and therefore prices are the highest, purchasing the necessary capacity can be costly.