Federal Reports

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

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

Employee Out-Processing Program

In planning and performing our audit of the financial statements of the United States Capitol Police (USCP or the Department) as of and for the year ended September 30, 2011. We considered USCP’s internal control over financial reporting as a basis for designing audit procedures that are appropriate in circumstances for the purpose of expressing our opinion on the financial statements.

Title VII Preliminary Investigation Process

We audited $67.9 million in costs billed to TVA between November 2006 and December 2009 for modification, supplemental maintenance, and technical support services provided at TVA nuclear plants by Williams Plant Services, LLC (Williams). Our objective was to determine if the costs billed by Williams were in accordance with the terms of the contract. In summary, we found TVA had been overbilled $1,229,401 as follows:$714,288 was overbilled for subcontractor costs for Williams' sister company, Williams Specialty Services. The overbilling included (a) $631,131 in unallowable craft labor costs and associated fees, (b) $99,448 in costs not provided for in Williams' subcontract with Williams Specialty Services, (c) $7,489 in unsupported costs, and (d) a credit of $23,780 for an invoice that was underpaid by TVA.$279,288 was overbilled for payroll tax costs on non-manual employees.$225,463 was overbilled for labor costs, including (a) $190,804 in fringe benefit costs for non-manual employees who did not receive fringe benefits, (b) $26,349 in unsupported and duplicate labor billings, and (c) $8,310 for non-manual labor costs billed at incorrect markup rates.$10,362 was billed for ineligible fees applied to fitness for duty/badging costs. Summary Only

As a result of issues discussed during meetings at Watts Bar Nuclear Plant (WBN), an audit was initiated to (1) assess the process for remediating Problem Evaluation Reports (PER) for the WBN Unit 2 project, and (2) determine the effectiveness of remediation stemming from the PER process.We identified improvements needed in the effectiveness and efficiency of the PER process. Specifically, we determined the process could be improved to assure Corrective Action Plans (CAP) were closed out timely by tracking Corrective Action Plans (CAP) that were not approved within 30 calendar days of Project Review Committee (PRC) review. Prior to the issuance of our report, WBN U2 issued a PER to address all CAP timeliness issues from a project-wide standpoint. We also identified an opportunity to improve the trending of PERs and recommended the WBN U2 Quality Assurance Manager expand the trending analysis guidelines to include categorizing of PERs by level of importance and analyzing PER trends according to importance as well as quantity. Summary Only

In accordance with our Fiscal Year (FY) 2011 annual plan, the Office of Inspector General (OIG) conducted a performance audit to determine whether the United States Capitol Police (USCP or Department) has (1) integrated its information technology (IT) strategy with the overall Department strategy and mission; (2) aligned IT resources and systems to support the Department's mission; (3) communicated and coordinated the business, mission-critical, and IT organizations within the Department; and (4) aligned IT investments in the budgeting and procurement processes. Our scope included Department information systems in production as of June 1, 2011.

Section 11(d)(9) of the Inspector General Act of 1978, as amended, requires the Council of the Inspectors General on Integrity and Efficiency to submit to Congress and the President an annual report on the activities of the Integrity Committee. For more informatoin about the Integrity Committee, please visit the link below.

OIG reviewed demurrage costs incurred from October 1, 2004, through June 13, 2011, totaling $14 million to assess why demurrage costs were incurred and what actions, if any, TVA could take to minimize these costs.We determined (1) $1,036,100 in origin demurrage costs had not been billed back to a contractor as provided for in the contract; (2) TVA had not fulfilled its contractual obligation to provide a contractor with applicable portions of barging agreements, resulting in $537,440 in unrecoverable demurrage costs; (3) $376, 667 in demurrage costs were incurred and billed back to the contractor but had not been paid; (4) TVA's agreement with a contractor lacked the necessary language to hold the contractor accountable for origin demurrage costs until January 1, 2011, when a new contract was put in place, resulting in unrecoverable demurrage costs of $784,000; (5) due to inconsistencies in demurrage contract terms for coal delivered to Cumberland Fossil Plant (CUF), TVA incurred approximately $764,400 in unrecoverable costs; changes to the unload time under this same contract could save TVA about $327,600 annually; (6) a clause in TVA's contract for delivery to Allen Fossil Plant (ALF) was not aligned with the operating conditions at the plant which prevented TVA from using a provision to mitigate demurrage costs; (7) origin and destination demurrage costs were not tracked separately, which prevented TVA from transferring origin demurrage costs to the supplier; (8) eliminating barge damage charges at ALF could reduce costs by at least $145,000 per year; and (9) addressing operational challenges at ALF and CUF could reduce demurrage costs at these plants. As a result of the operational challenge at ALF, we also noted that when the focus of a business unit is on their individual goals rather than TVA goals, the overall strategic business unit's budget and ultimately TVA's expenses can be impacted. This was previously identified in OIG audit, 2002-911E, Review of the Coal Procurement Process.In addition, we determined that more effective knowledge of the contract demurrage terms, monitoring of the contracts, and communication among terminal, barge, and rail contract administrators, the Coal and Gas Services specialist responsible for demurrage payments, and Yard Operations personnel are needed.We made recommendations accordingly to the Senior Vice President, Fossil Power Group. Summary Only

Audit of the FY 2011 Financial Statements.

This report is Sensitive But Unclassified. 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.

This report are follow up on Basic Agency Grants and updates the status

Management Letter for 2011 Financial Statement

This report is Sensitive But Unclassified. 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.

We audited $314.9 million of costs billed to TVA by G-UB-MK Constructors for modifications and supplemental maintenance work at TVA fossil and hydro plants and other TVA-controlled facilities. In summary, we determined G-UB-MK's billings to TVA complied with the terms of the contract except for $3,783 in net overbillings for craft labor. The contractor agreed with our findings and plans to issue TVA a credit for the overbilled costs. Summary Only