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The Government Management Reform Act of 1994 requires that the Department of Energy (DOE) annually submit audited financial statements to the Office of Management and Budget (OMB). A departmentwide audit was conducted to determine whether there was reasonable assurance that DOE's consolidated Fiscal Year (FY) 1999 financial statements were free of material misstatements. We conducted a portion of the departmentwide audit at the Idaho Operations Office (Idaho) and its then management and operating contractor for the Idaho National Engineering and Environmental Laboratory (INEEL), Lockheed Martin Idaho Technologies Company (Lockheed).1

The Department of Energy (Department) devotes a significant amount of its annual budget to the acquisition and maintenance of information technology resources. About $1.6 billion, or almost 9 percent of the Department's Fiscal Year 1999 budget of $17.9 billion, was for the acquisition, operation, and maintenance of information technology. Approximately $200 million, or 12.5 percent of the information technology budget, was for desktop (personal computing) technology. Over 130,000 personal computers are in use Department-wide. These computers operate a wide variety of commercial off-the-shelf (COTS) computer software, including electronic mail, word processing, spreadsheet, database management, application development, statistical analysis, presentation, security and virus protection. Many Departmental offices, including the Headquarters Office of Procurement and Assistance Management, various program and field offices, and contractor-operated facilities, have independently negotiated contracts to acquire and maintain information technology related products.Ï

Commercial Off-The-Shelf Software Acquisition Framework

Report on Matters Identified at The Idaho Operations Office During The Audit of The Department of Energy's Consolidated Fiscal Year 1999 Financial Statements

The Government Management Reform Act of 1994 requires that the Department of Energy (DOE) annually submit audited financial statements to the Office of Management and Budget (OMB). A departmentwide audit was conducted to determine whether there was reasonable assurance that DOE's consolidated Fiscal Year (FY) 1999 financial statements were free of material misstatements. We conducted a portion of the departmentwide audit at the Richland Operations Office (Richland); Office of River Protection (ORP); CH2M Hill Hanford Group, Incorporated (CH2M Hill); Bechtel Hanford, Incorporated (Bechtel); and Fluor Hanford, Incorporated (Fluor) and its subcontractors. The audit disclosed an error, as of September 30, 1999, in the Environmental Liabilities account. Richland's Environmental Liabilities account was understated because the cost estimates for closure of single shell tank farms had not been updated to reflect current engineering estimates. We recommended that Richland adjust the Environmental Liabilities account and that management review other project cost estimates to determine if estimates were based on the best available data. Management concurred with the recommendations and implemented corrective actions.

Report on Matters Identified at The Hanford Site during the Audit of The Department of Energy's Consolidated Fiscal year 1999 Financial Statements

It recently came to our attention thas several contracts awarded by the Department to manage its facilities include clauses requiring charitable giving by the contractors. In pursuit of this matter, the Office of Inspector General conducted a limited review and identified three recent solicitations and corresponding contracts that did, in fact, contain such provisions. These provisions are over and above contractor requirements for local economic development. One contract, for example, requires the contractor to contribute $1 million per year to "educational, cultural, civic, and health and welfare organizations" for each year of the contract. This was consistent with the contractor's commitment made in response to the Department's terms for soliciting bids. the level of giving with respect to the other two contracts we reviewed is $860,000 over the life of one contract and a minimum of $600,000 per year in the other contract. A listing of the solications and contracts is attached.

Charitable Giving Requirements in Department of Energy Contracts