Federal Reports

The OIG audited Tennessee Valley Authority's (TVA) craft labor staffing, which was identified by TVA as one of its top five risks in two risk categories, talent management and capacity expansion and construction. Our objectives were to assess TVA's mitigation of craft labor risks associated with competition from other companies and a shrinking labor pool and its process for identifying craft labor risks. We focused on TVA's plans with regard to contractor craft workforce. Our audit included mitigation plans as defined in TVA's Enterprise Risk Management document dated July 13, 2011 and additional mitigations for contractor craft labor within the Generation Construction, Coal Operations, Gas Operations, Nuclear Construction, and Nuclear Power Group organizations.Based on our review of TVA's plans and actions to mitigate the risk and potential effects of craft labor shortages, we determined plans and actions were inadequate to aid in the achievement of future goals as identified in TVA's Integrated Resource Plan (IRP). Specifically, we determined risk mitigation actions related to competition needs improvement, and deficiencies existed in risk planning and mitigation related to the shrinking labor pool. In addition, we noted improvements could be made to the process for assessing and monitoring risk related to craft labor.TVA has passed the management of craft labor risk to contractors, unions, and other organizations. In our opinion, TVA, as part of its economic development mission, has an obligation to participate in efforts to replenish shrinking craft labor pools. In addition, to achieve long-term future goals as identified in TVA's IRP, it is necessary to develop actions for attracting and retaining craft labor and/or look for alternative solutions to achieve these goals.Based on the above, we recommended nine actions related to the process for monitoring craft labor staffing risk, as well as plans and actions for reducing craft labor staffing risk. TVA management agreed with the findings and recommendations.

EAC OIG, through the independent public accounting firm of Leon Snead & Co. P.C., audited EAC's compliance with OMB Circular A-130 and FISMA requirements for 2012.

Trade Remedy Assistance Office

This report contains classified information that is exempt from disclosure under the Freedom of Information Act. To obtain further information, please contact the OIG Office of Counsel at OIGCounsel@oig.treas.gov, (202) 927-0650, or by mail at Office of Treasury Inspector General, 1500 Pennsylvania Avenue, Washington DC 20220.

The OIG performed an interim audit of costs billed to the Tennessee Valley Authority (TVA) by Bechtel Power Corporation for providing engineering, procurement, and construction services in support of the completion of TVA's Watts Bar Nuclear Plant Unit 2. Our audit included about $397 million in costs billed to TVA from October 1, 2007 to December 31, 2009. Our objective was to determine if Bechtel billed TVA in accordance with the contract terms and conditions. We determined Bechtel overbilled TVA an estimated $1,449,752 including:$903,698 in labor and related costs, which included (1) $778,617 in ineligible home office labor costs, (2) $75,309 in excess payroll additive costs, (3) $34,098 in excessive labor costs, and (4) $15,674 in fees for manual personnel seconded services. In addition, we found Bechtel did not invoice costs for seconded services separately as required by the contract, and seconded service costs were improperly included in Bechtel's annual performance fee base.$546,054 in other ineligible or unsupported direct costs, which included (1) $534,835 for relocation, temporary assignment, and travel costs; (2) $5,795 for other nonlabor direct costs; and (3) $5,424 for fees on subcontractor costs.We recommend TVA management (1) recover $1,449,752 in overbilled costs from Bechtel, (2) ensure Bechtel separately invoices all seconded service costs, and (3) ensure seconded service costs are excluded from Bechtel's annual performance fee base. Summary Only

The OIG completed agreed-upon procedures to assist the Center for Resource Solutions (CRS) in determining TVA's compliance with annual reporting requirements of the CRS Green Pricing Accreditation Program for the year ended December 31, 2011. The results of procedures applied to TVA's renewable energy initiative, "Green Power Switch," were provided to the Center for Resource Solutions. Summary Only

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

Software Licensing

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

The OIG audited $35.7 million in costs billed to the Tennessee Valley Authority (TVA) by Trans-Ash, Inc. The contracts provided for Trans-Ash to perform(a) assistance in the off-site fly ash utilization project at Johnsonville Fossil Plant,(b) ash pond management services at Johnsonville Fossil Plant, and (c) additional work described in separate Task Agreements (TAO) executed by TVA and Trans-Ash. In summary, we determined Trans-Ash billed TVA (1) $1,479,630 for work that was not authorized under the contracts, and (2) $186,955 in excessive and unsupported costs. Specifically,(1) $1,479,630 was billed for work not included in the contracts' scopes and not authorized by separate TAOs. Additionally, the cost was billed using rates that were (a) not provided for by the contracts and (b) higher than rates included in another contract TVA had with Trans-Ash. As a result, the unauthorized cost was inflated by $81,434.(2) $186,955 was overbilled due to:- $170,993 in excessive costs that were billed on three TAOs;- $13,866 in unsupported costs; and- $2,096 in excessive costs billed due to an inflated tonnage rate.We recommended TVA management:1. Determine if $1,479,630 of unauthorized work should be recovered from Trans-Ash. If TVA management decides to pay for the unauthorized work, it should take action to recover $81,434 of inflated billings from Trans-Ash. Additionally, management needs to implement controls to ensure future work with Trans-Ash is properly authorized and billed using established contractual provisions.2. Take action to recover $186,955 in overbilled costs from Trans-Ash. Summary Only

The Federal Labor Relations Authority OIG reviewed the system of quality control for the audit organization of the EAC OIG in effect for the year ended March 31, 2012. This report discusses their findings.

At the request of the Chief of Police (Chief) and Chief Administrative Officer (CAO) of the United States Capitol Police (USCP or Department) the Office of Inspector General (OIG) conducted Agreed-Upon Procedures (AUP) of the time and attendance (T&A) process. The AUP was to assist in further determining the adequacy, effectiveness, and efficiency of USCP policies, procedures, and internal controls over the Department's T&A processes and system.