Federal Reports

KPMG LLP’s (KPMG) report on its financial statement audit of the National Credit Union Administration’s (NCUA) financial statements, which includes the Share Insurance Fund, the Operating Fund, the Central Liquidity Facility, and the Community Development Revolving Loan Fund, as of and for the year ended December 31, 2025. The NCUA prepared financial statements in accordance with the Office of Management and Budget (OMB) Circular No. A-136 Revised, Financial Reporting Requirements, and subjected them to audit. Under a contract monitored by the NCUA OIG, KPMG, an independent certified public accounting firm, performed an audit of NCUA’s financial statements as of December 31, 2025. The contract required that the audit be performed in accordance with generally accepted government auditing standards issued by the Comptroller General of the United States, OMB audit guidance, and the Government Accountability Office/President's Council on Integrity and Efficiency Financial Audit Manual. KPMG’s audit report for 2025 includes: (1) an opinion on the financial statements, (2) conclusions on internal control over financial reporting, and (3) a section addressing compliance and other matters. In its audit of the NCUA, KPMG found:• The financial statements were fairly presented, in all material respects, in conformity with U.S. generally accepted accounting principles,• There were no deficiencies in internal control identified as material weaknesses or significant deficiencies and• No instances of reportable noncompliance with laws and regulations it tested or other matters that are required to be reported under Government Auditing Standards or OMB guidance.

This audit was performed by the Defense Contract Audit Agency (DCAA) on behalf of the Department of Energy’s Office of Inspector General and examined Fluor Federal Petroleum Operations, LLC’s (FFPO) costs incurred and claimed for fiscal years 2022 and 2023 under management and operating contract No. DE-FE0011020.

The audit’s objective was to determine if costs charged to Department Contract No. DE-FE0011010 for fiscal years 2022 and 2023 were allowable, allocable, and reasonable in accordance with applicable laws, regulations, and contract terms.

The DCAA performed the audit in accordance with generally accepted government auditing standards.

The DCAA identified three audit findings and questioned over $2.5 million in: (1) direct labor costs associated with unallowable recruitment costs for a seconded employee, unreasonable labor costs, and overtime premiums unallowable per contract terms; (2) travel costs associated with relocation and per diem expenses; and (3) other direct costs associated with home office expenses that were unallowable per contract terms. In addition to the questioned costs noted, the DCAA reported two scope limitations, which prevented it from determining whether certain subcontract costs were fair and reasonable.  

If the issues identified by the DCAA are fully addressed, it should help ensure that costs charged to the Department are allowable, allocable, and reasonable in accordance with applicable laws, regulations, and contract terms.

FFPO responded to the audit findings during an exit conference and provided a written response that is included in the DCAA’s audit report. FFPO concurred with the portion of the questioned direct labor costs pertaining to a retention bonus but did not concur with the other questioned costs related to direct labor, direct travel, and other direct costs.

This Office of Inspector General (OIG) Healthcare Facility Inspection program report describes the results of a focused evaluation of the care provided at the Healthcare Facility Inspection of the VA Central California Health Care System in Fresno. 

This evaluation focused on five key content domains:
     •    Culture
     •    Environment of care
     •    Patient safety
     •    Primary care
     •    Veteran-centered safety net

The OIG issued seven recommendations for VA to correct identified deficiencies in three domains:
   1.    Environment of care
     •    Badge holder responsibilities
     •    Signs
     •    Privacy curtains, preventive equipment maintenance, splash resistant bottom shelves
     •    Expired, damaged, and contaminated medications
     •    Pharmaceutical grade medication refrigerators
   2.    Primary care
     •    Staffing
   3.    Veteran-centered safety net
     •    Housing and Urban Development–Veterans Affairs Supportive Housing program staffing

The objective of this audit was to determine the extent to which the National Collections Program had effective controls over the processes to award monies from the Collections Care and Preservation Fund (CCPF) and ensure that these funds were spent in accordance with their intended purposes.

We made nine recommendations for Smithsonian management to strengthen controls over the awarding and monitoring of CCPF funds, ensure that recipient units timely submit interim and final reports on project results, and require that units follow proper procedures in administering the Pan-Smithsonian Cryo Initiative. Management concurred with all nine recommendations.

In March 2025, we identified and conveyed to the Department suspicious activity related to parent information used on multiple dependent student Free Application for Federal Student Aid (FAFSA) forms. At the time, FSA flagged these students for identity verification and we issued “Fraud Watch Issue 1: Potentially Fraudulent Activity Involving Parent Information Included on FAFSA.” In June 2025, we initiated analysis of additional data and ultimately found that this pattern of activity involving dependent students with unusual parent data on the FAFSA had continued. We determined that 12,026 dependent student identities submitted FAFSAs associated with 1,991 parent identities where it is unlikely that the student and parent are related or associated. As a result, these FAFSA submissions have a high likelihood of being fraudulent—a potential loss of almost $3.5 million in Federal student aid associated with these FAFSA submissions during award year 2024–2025. We recommend that FSA (1) work with the IRS to implement additional controls to detect and prevent the misuse of stolen identities on FAFSA submissions, especially fraud schemes involving the use of potentially stolen student identities and nonrelated, potentially stolen parent identities.  And (2) conduct risk-based verification and validation procedures at the time FSA IDs are created. This can prevent the improper disbursement of Federal student aid based on fraudulent FAFSA submissions containing stolen identities.