Federal Reports

EAC OIG, through the independent public accounting firm of Brown & Company CPAs and Management Consultants, PLLC, audited EAC's financial statements for the fiscal years ended September 30, 2015, and September 30, 2014.

Sierra View Medical Center (the Medical Center), located in Porterville, California, complied with Medicare billing requirements for 5 of the 30 inpatient and outpatient claims we reviewed. However, the Medical Center did not fully comply with Medicare billing requirements for the remaining 25 claims, resulting in overpayments of approximately $798,000. These overpayments occurred primarily because the Medical Center did not have adequate controls to prevent the incorrect billing of Medicare claims within the selected risk areas that contained errors.

At the request of the Tennessee Valley Authority's (TVA) Supply Chain, we examined the cost proposal submitted by a contractor for construction and modification services. Our examination objective was to determine if the contractor's cost proposal was fairly stated for a planned $100 million contract. In our opinion, the cost proposal (1) overstated the rates in the equipment rate schedule, (2) understated the overhead and general and administrative (G&A) rates in the labor markup rate schedule, (3) overstated subcontractor costs in the coal plant's baseline project price, and (4) overstated the minimum and maximum non-manual wage rates. We estimated TVA could achieve a net savings of about $2.96 million on the planned $100 million contract by reducing the equipment rates, increasing the labor markups, and ensuring an indirect cost markup is not applied to subcontractor costs. In addition, we found the contract's compensation terms and related attachments were inconsistent with the methodology TVA intends to use to compensate the contractor.(Summary Only)