All Reports

At the request of the Tennessee Valley Authority's (TVA) Supply Chain, we examined the labor and labor markup rates included in a contract TVA has with a contractor. Our examination objective was to determine if the contract's labor and labor markup rates were fairly stated for a planned 5-year contract extension.In our opinion, the contract's labor and labor markup rates were fairly stated. However, we found the contract's current labor rate ranges are not reflective of the actual costs of the contractor's employees.

The Office of the Inspector General reviewed TVA’s three operating system baselines and how they are applied to the tools used to deploy and manage TVA systems. In summary, we found TVA management aligned two of the three server operating system baselines with the identified best practices and had documentation to support any deviations. However, we found one of the three operating system baselines did not fully align with the identified best practices and was not completely applied to the tools used to deploy and manage TVA server configurations.

At the request of the Tennessee Valley Authority's (TVA) Supply Chain, we examined the labor and labor markup rates included in a contract TVA has with a contractor. Our examination objective was to determine if the contract's labor and labor markup rates were fairly stated for a planned 5-year contract extension.In our opinion, the contract's labor and labor markup rates were fairly stated.

The Office of the Inspector General conducted a review of Supply Chain’s Sourcing organization to identify operational and cultural strengths and risks that could impact Sourcing’s organizational effectiveness. Our report identified strengths within Sourcing related to (1) teamwork, (2) direct management support for 3 of 4 departments, (3) perceptions of an ethical culture, and (4) customer support. However, we also identified issues that, if left unresolved, could increase the risk that Sourcing will be unable to effectively meet its objective in the future.

The Office of the Inspector General audited the network architecture of a nuclear facility to determine if the network architecture and assets in use to support a specific nuclear plant’s business and operational functions are compliant with TVA policies, procedures and identified best practices. In summary, we found TVA management used proven best practices in the design of the corporate physical and wireless networks and the control network.

We evaluated TVA’s administration of Coal Quality Adjustment Reports (CQAR) to determine if the Coal Quality Adjustment Reports were accurately calculated in accordance with the contract terms. We determined CQARs were not always calculated in accordance with the applicable contractual terms, and as a result, TVA did not accurately adjust the payments made to some coal vendors. The miscalculations were due to incorrect (1) rounding of moisture, ash, and British thermal units (BTU) quality adjustment rates and (2) weighted averages used for moisture, ash, and sulfur calculations.

At the request of the Tennessee Valley Authority's (TVA) Supply Chain, we examined the cost proposal submitted by a company for civil projects and coal combustion residual program management work at TVA's steam electric power plants. Our examination objective was to determine if a company's cost proposal was fairly stated for a planned <br> $50 million contract.In our opinion, the company's cost proposal was overstated.

The Tennessee Valley Authority estimates the dispatch costs for coal and gas on a combination of elements including fuel pricing, physical operating characteristics, estimates of variable operating and maintenance costs, and other variables. Since heat rates are one of the primary physical characteristics used in the calculation of dispatch costs, we performed an evaluation to determine if inputs used in the development of heat rate curves were calculated accurately.

We included an audit of the Tennessee Valley Authority’s (TVA) capital projects post projects economic assessment process in our annual audit plan because of the capital-intensive nature of the electric utility industry. TVA spent $2.076 billion on capital expenditures in fiscal year (FY) 2017 and anticipates capital expenditures of $1.974, $1.885, and $1.706 billion, respectively, in FYs 2018, 2019, and 2020.

We included an audit of the Tennessee Valley Authority’s (TVA) economic development (ED) grants in our annual audit plan based on findings from our 2013 audit of TVA’s Valley Investment Initiative, where we found TVA’s oversight of that program could be improved. Currently, there are two main grant programs utilized—Performance Grant Program and InvestPrep Program. Our audit objectives were to determine if TVA has (1) adequate processes and procedures in place for awarding ED grants and (2) established performance metrics to determine if grant program objectives are met.