Federal Reports

This statutory report presents the activities and accomplishments of the OIG from April 1, 2025, through September 30, 2025. The audits, investigations, and related work highlighted in the report are products of our mission to identify and stop fraud, waste, and abuse; and promote accountability, efficiency, and effectiveness through our oversight of the Department’s programs and operations.

This audit was performed by the Defense Contract Audit Agency (DCAA) on behalf of the Department of Energy’s Office of Inspector General and examined Fluor Federal Petroleum Operations, LLC’s (FFPO) costs incurred and claimed for fiscal years 2022 and 2023 under management and operating contract No. DE-FE0011020.

The audit’s objective was to determine if costs charged to Department Contract No. DE-FE0011010 for fiscal years 2022 and 2023 were allowable, allocable, and reasonable in accordance with applicable laws, regulations, and contract terms.

The DCAA performed the audit in accordance with generally accepted government auditing standards.

The DCAA identified three audit findings and questioned over $2.5 million in: (1) direct labor costs associated with unallowable recruitment costs for a seconded employee, unreasonable labor costs, and overtime premiums unallowable per contract terms; (2) travel costs associated with relocation and per diem expenses; and (3) other direct costs associated with home office expenses that were unallowable per contract terms. In addition to the questioned costs noted, the DCAA reported two scope limitations, which prevented it from determining whether certain subcontract costs were fair and reasonable.  

If the issues identified by the DCAA are fully addressed, it should help ensure that costs charged to the Department are allowable, allocable, and reasonable in accordance with applicable laws, regulations, and contract terms.

FFPO responded to the audit findings during an exit conference and provided a written response that is included in the DCAA’s audit report. FFPO concurred with the portion of the questioned direct labor costs pertaining to a retention bonus but did not concur with the other questioned costs related to direct labor, direct travel, and other direct costs.

KPMG LLP’s (KPMG) report on its financial statement audit of the National Credit Union Administration’s (NCUA) financial statements, which includes the Share Insurance Fund, the Operating Fund, the Central Liquidity Facility, and the Community Development Revolving Loan Fund, as of and for the year ended December 31, 2025. The NCUA prepared financial statements in accordance with the Office of Management and Budget (OMB) Circular No. A-136 Revised, Financial Reporting Requirements, and subjected them to audit. Under a contract monitored by the NCUA OIG, KPMG, an independent certified public accounting firm, performed an audit of NCUA’s financial statements as of December 31, 2025. The contract required that the audit be performed in accordance with generally accepted government auditing standards issued by the Comptroller General of the United States, OMB audit guidance, and the Government Accountability Office/President's Council on Integrity and Efficiency Financial Audit Manual. KPMG’s audit report for 2025 includes: (1) an opinion on the financial statements, (2) conclusions on internal control over financial reporting, and (3) a section addressing compliance and other matters. In its audit of the NCUA, KPMG found:• The financial statements were fairly presented, in all material respects, in conformity with U.S. generally accepted accounting principles,• There were no deficiencies in internal control identified as material weaknesses or significant deficiencies and• No instances of reportable noncompliance with laws and regulations it tested or other matters that are required to be reported under Government Auditing Standards or OMB guidance.