Audit: DOE-OIG-25-20

May 27, 2025

The Department of Energy’s Payment Integrity Reporting in the Fiscal Year 2024 Agency Financial Report

The Payment Integrity Information Act of 2019 (PIIA) was signed into law in March 2020 and requires agencies to identify and review all programs and activities they administer that may be susceptible to significant improper payments based on guidance provided by the Office of Management and Budget (OMB). The PIIA and the OMB also require the Office of Inspector General to conduct an annual review of improper payments identified in the Department of Energy’s Agency Financial Report.

We conducted this audit to determine whether the Department met OMB criteria for compliance with the PIIA.

The Department’s fiscal year (FY) 2024 improper payment reporting was aligned with OMB criteria. The Department published its FY 2024 Agency Financial Report and posted that report and the accompanying materials on its website. In addition, the Department performed risk assessments across all reporting sites for FY 2024. Based on the site risk assessments performed in FY 2024 and consolidated at the Departmental level, the Department determined that it was not susceptible to making significant improper payments.

Although we determined that the Department met the OMB’s compliance criteria, we identified areas where continuous improvements to the underlying root cause process could result in more efficient and accurate identification of improper payments. Without properly identifying underlying root causes, the Department is unable to adequately identify trends related to improper payments and take appropriate corrective actions to mitigate recurrences.

We suggest that the Department continue to make improvements to the payment integrity process to include: (1) further development of the Root Cause Dashboard, (2) consideration to track adjustments to previously reported improper payments in the Agency Financial Report to provide greater payment integrity reporting transparency, and (3) development of enhanced guidance and training to ensure the sites identify root causes in detail for every transaction.