You are here

Audit Report: OAS-M-14-03

March 12, 2014

Fiscal Year 2012 Work Performed Under the Work for Others Program at Los Alamos National Laboratory

The Office of Inspector General contracted with an independent certified public accounting firm, KPMG, LLP (KPMG), to assess the internal control structure at Los Alamos National Laboratory (LANL) and determine whether it is effective in achieving the current goals and objectives of the Work for Others (WFO) Program for Fiscal Year (FY) 2012.

KPMG concluded that, except for the finding detailed in the report, LANL implemented internal controls and compliance procedures in FY 2012 that met the Department of Energy's (Department) WFO Program requirements, as stated in Department regulations, guidance and applicable contract provisions.  However, KPMG found that labor costs of certain personnel who primarily supported the WFO Program were not allocated to WFO projects.  KPMG estimated that during FY 2012, the Department would have an annual savings of approximately $2 million by implementing a separate indirect rate for these support organizations. 

Further, KPMG noted that LANL's Ethics and Audit Division performed audits of the LANL timekeeping policies in FY 2009 and FY 2011, and both audits identified employees who did not allocate time proportionately benefiting projects.  Because LANL had taken corrective action and implemented additional policies and procedures for timekeeping, KPMG did not repeat the related findings and recommendations in its report.  The National Nuclear Security Administration generally concurred with the finding and recommendation.

Topic: Management & Administration