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Audit Report: OAS-RA-L-11-12

September 29, 2011

Implementation of the Recovery Act at the Savannah River Site

Overall, we found that Savannah River Site (SRS) generally complied with American Recovery and Reinvestment Act of 2009 (Recovery Act) requirements such as reporting, flow down of requirements to subcontracts, and segregation of funds.  According to SRS officials, Recovery Act projects are on schedule, within estimated costs, and goals and objectives are being met.  However, we identified a concern regarding the accurate distribution of costs associated with staff augmentation contractors working on Recovery Act Projects.  Our analysis of a judgmental sample of cost transactions disclosed that Savannah River Nuclear Solutions, LLC (SRNS) did not always properly distribute costs invoiced under staff augmentation contracts to appropriate accounting codes.  The system used to track staff augmentation invoices did not have controls in place to ensure that all timesheets for the invoiced period were selected for inclusion in the distribution calculation.  Additionally, the system did not take into account the difference between standard and overtime rates in distributing costs to manhours.  As a result, invoiced costs were not always accurately distributed to correct project activity codes.  When we brought this matter to SRNS's attention, we were informed that steps had been taken to correct some misapplied distributions and prevent future errors.  SRNS management also indicated that they planned to implement a new accounts payable system that would automate the process and better align staff augmentation invoicing with cost distribution.  Management's planned actions appear reasonable.  However, until the new system is in place, we suggest that SRNS and Department of Energy management review manual adjustments to the current system, as necessary, to ensure the accuracy of staff augmentation cost distributions.

Topic: Environmental Cleanup