Federal Reports

EAC OIG, through the independent public accounting firm of Leon Snead & Co., conducted an audit of EAC's compliance with the requirements of the Federal Information Security Management Act for fiscal year 2010.

We audited $51.2 million in costs billed to TVA by a contractor for financial management and consulting services under two contracts. Our objective was to determine if the costs billed from July 2003 through December 2008 were in compliance with the provisions of the contracts. In summary, we found $4.8 million of costs billed by the contractor were unsupported or not in accordance with the terms of the contracts as follows.$3,328,704 was overbilled because the contractor did not limit its overtime billings as it represented it would in its proposals and in the final terms of one of the contracts. (The overbilling included about $890,000 that occurred from the end of our audit period through March 31, 2010.)$514,669 in labor costs were overbilled due to unapproved job categories or incorrect billing rates, timesheet discrepancies, and unallowable administrative labor.An estimated $51,233 was billed for unallowable or unsupported travel expenses and travel agency fees.$1,020,454 in overbillings occurred because costs had been performed prior to the issuance of a contract work authorization, exceeded the CWA funding limits, or was not authorized under the terms of a CWA.The overbillings itemized above included $108,877 that was included in more than one finding. Accordingly, the net overbilling after removing this duplication was $4,806,183. Summary Only

We audited $24.9 million in payments made by TVA from 2007 through 2009 to a contractor for providing engineering, design, and construction support. In summary, we found the contractor overbilled TVA an estimated $39,915, including (1) $26,182 in overbilled labor and fee costs and (2) $13,733 in overbilled direct costs. We recommended TVA management take action to recover the overbilled costs. The contractor agreed with our findings and recommendations.and stated it would issue a credit invoice to TVA. Summary Only

The Office of Inspector General (OIG) works to promote efficiency, effectiveness, and integrity in the programs and operations of the U.S. Department of Education (Department). Through our audits, inspections, investigations, and other reviews, we continue to identify areas of concern within the Department’s programs and operations and recommend actions the Department should take to address theseweaknesses. The Reports Consolidation Act of 2000 requires OIG to identify and summarize the most significant management challenges facing the Department each year. Last year, we reported three management challenges: the American Recovery and Reinvestment Act of 2009 (Recovery Act); student financial assistance (SFA) programs, with a focus on the Ensuring Continued Access to Student Loans Act of2008; and information security and management. All three have been updated as challenges for fiscal year (FY) 2011, and Data Quality and Reporting, previously a sub-area, is presented as a separate challenge.

An appendix to this report is available at the link below.