Consolidated Financial Statements

As required by the Government Management Reform Act of 1994, we audited the
U.S. Department of Energy's (Department) consolidated financial statements as of and for
the years ended September 30, 1998 and 1997 to determine whether they presented fairly,
in all material respects, the Department's financial position, net cost, changes in net
position, budgetary resources, financing activities, and custodial activities in conformity
with Federal accounting standards. As part of this Departmentwide effort, we examined
internal controls, assessed compliance with applicable laws and regulations, and tested
selected account balances at Headquarters and at a number of field activities. The results of our audit are included in Audit Report No. IG-FS-99-01 issued February 25, 1999. Additional management-level reports addressing local issues are being issued to field elements.

The Government Management Reform Act of 1994 requires that audited financial statements covering all accounts and associated activities of the Department be submitted annually to the Office of Management and Budget. A Departmentwide audit of the consolidated Fiscal Year 1998 financial statements was conducted by examining internal controls, assessing compliance with laws and regulations, evaluating accounting transaction cycles, and testing selected account balances at various Department facilities. The objective of the Departmentwide audit was to determine whether the Department’s consolidated financial statements presented fairly, in all material respects, the financial position of the Department as of September 30, 1998 and 1997, and its consolidated net cost, changes in net position, budgetary resources, financing activities, and custodial activities for the fiscal years then ended in conformity with Federal accounting standards. Departmentwide issues are addressed in Audit Report No. IG-FS-99-01, issued February 25, 1999.

The Government Management Reform Act of 1994 requires that audited financial statements covering all accounts and associated activities of the Department be submitted annually to the Office of Management and Budget. A Departmentwide audit of the consolidated Fiscal Year 1998 financial statements was conducted by examining internal controls, assessing compliance with laws and regulations, evaluating accounting transaction cycles, and testing selected account balances at various Department facilities. The objective of the Departmentwide audit was to determine whether the Department’s
consolidated financial statements presented fairly, in all material respects, the financial position of the Department as of September 30, 1998 and 1997, and its consolidated net cost, changes in net position, budgetary resources, financing activities, and custodial activities for the fiscal years then ended in conformity with Federal accounting standards. Departmentwide issues are addressed in Audit Report No. IG-FS-99-01, issued February 25, 1999.

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 DOE-wide audit was conducted to determine whether there was reasonable assurance that DOE's consolidated Fiscal Year (FY) 1998 financial statements were free of material misstatements. We conducted a portion of the DOE-wide audit at the Oakland Operations Office (Oakland) and its management and operating contractors.