Federal Reports

The objective of this review was to determine the current status of operations in those areas where ARC had agreed to take corrective action.

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

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.

We reviewed the first FCA that went into effect January 1, 2007. The objective of our review was to determine whether the FCA for the second quarter fiscal year 2007 was calculated correctly and in accordance with the agreed-upon methodology. In summary, we found the FCA was calculated correctly and in accordance with agreed-upon methodology. Summary Only

We surveyed TVA and financial institutions in the Tennessee Valley to identify (1) any TVA-owned cash accounts not currently accounted for by TVA's Treasury and (2) non-TVA-owned cash accounts set up in TVA's taxpayer identification number (TIN). In summary, we identified:One TVA-owned certificate of deposit set up in TVA's TIN and not accounted for by TVA Treasury;Three non-TVA-owned accounts incorrectly reported in TVA's TIN;One account set up in TVA's TIN where sufficient information was not provided to determine if TVA owned the funds; andTen accounts reported by one financial institution where the name on the account included TVA or some derivation thereof; however, the institution would not confirm the TIN and these accounts were not accounted for by TVA Treasury.TVA Treasury agreed to follow up with the financial institutions in these matters. Summary Only