All Reports

The Office of the Inspector General was requested by the Vice President, BFN Unit 1 Restart, to review tool management associated with the restart project. TVA is providing all necessary tools for the BFN Unit 1 Restart. Work is primarily being completed by engineering and modification contractors, 1,500 of which are craft laborers who have tool needs/requirements. We assessed the processes and key control activities used to track and account for tools purchased for the BFN Unit 1 Restart and on-going BFN operations.

We reviewed a contractor's material cost adjustments and profit sharing calculations and determined the contractor (1) had understated the material cost adjustment due TVA by $5,933 and (2) could not provide verifiable documentation of the material weights used in its catalyst production. TVA management agreed with our findings and is taking action to recover the amount owed to TVA.

Visitors to the Inspector General's office here at TVA must walk past a large picture of the Fontana Hydro Plant. The inscription at Fontana, etched 63 years ago, reads, “1942 - Built for the people of the United States of America.” This simple phrase epitomizes the vision that gave birth to TVA. TVA was not to be merely another well-intentioned government program. The focus was not bricks and mortar. The focus was the American people.

We compared invoiced vendor/terminal weights to TVA delivered weights for both WCF rail and barge coal deliveries. We found (1) significant variances between vendor/terminal invoiced weights and TVA delivered weights, (2) weights were not recorded for many coal shipments, and (3) delivery weight documentation requirements or retention policy did not exist. Management agreed with our findings and plans to initiate corrective actions. OIG Investigations is reviewing selected trend variances to determine if any warrant further inquiry. Summary Only

We reviewed controls pertaining to program and data backup storage and retrieval for TVA's data centers and the physical controls of an offsite storage facility to determine if controls surrounding the backup storage and retrieval process were adequate to ensure ongoing system operations, and if physical and environmental controls were sufficient to protect the off-site facilities from unauthorized access and environmental hazards. We determined that both the (1) storage and retrieval process controls and (2) environmental controls need improvement.

We reviewed $615.5 million TVA paid a contractor from 1999 through 2004 for providing modification and supplemental maintenance services for TVA's fossil plants.

We reviewed the physical and environmental controls at two of TVA's data centers to determine the adequacy of (1) physical controls to ensure only authorized access to system resources and (2) environmental controls to appropriately protect computing assets from hazards. We determined both data centers' physical access controls and one data center's environmental controls need improvement. TVA management agreed with the findings and initiated or plans to initiate corrective actions needed to implement our recommendations. Summary Only

We reviewed TVA's progress in complying with federal security requirements. We found that TVA's security program structure is adequate to meet federal requirements, and TVA is making substantial progress in correcting significant security deficiencies. Summary Only

We determined TVA was overbilled $56,023 (out of $5.3 million that had been billed) for services performed at BFN Unit 1 by a subcontractor. The overbilling occurred because the subcontractor used a craft labor classification that was not provided for by its subcontract. We also determined the subcontractor had not adjusted its workers compensation insurance costs to actual for the premium years ended July 1, 2003, and July 1, 2004, although its subcontract agreement required it. TVA is assessing our recommendations. Summary Only

We found no instance where TVA's external auditor's reviews of TVA interim financial information for the third quarter of FY 2005 did not comply with Government Auditing Standards in all material respects, including required communications to appropriate parties.