Energy Management: Inadequate DOE Monitoring of Contractors' Acquisitions
From Affiliates (Testimony, 03/17/94, GAO/T-RCED-94-128).
The Energy Department's (DOE) monitoring of its main contractors at the
Savannah River Site in South Carolina--Westinghouse and Bechtel--do not
ensure that DOE pays fair and reasonable prices for acquisitions of
goods and services from the contractors' subsidiaries. GAO's review of
Westinghouse and Bechtel acquisitions uncovered inadequate cost controls
and performance problems, unallowable and questionable costs, and
inappropriate contract approvals and contract payments. Poor
Westinghouse management and limited DOE internal controls were
contributing factors. DOE has not complied with its own regulations
requiring competition for acquisitions from affiliates. Furthermore,
Westinghouse and Bechtel have been able to acquire items from its
subsidiaries without the same level of scrutiny that DOE would apply if
the purchases were made from nonaffiliated third parties. Various DOE
studies point out that problems with acquisitions from affiliates exist
elsewhere in the agency.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: T-RCED-94-128
TITLE: Energy Management: Inadequate DOE Monitoring of
Contractors' Acquisitions From Affiliates
DATE: 03/17/94
SUBJECT: Contract monitoring
Internal controls
Prime contractors
Financial management systems
Irregular procurement practices
Competitive procurement
Nuclear facilities
Contractor performance
Subcontractors
IDENTIFIER: Government Reform and Savings Act of 1993
------------------------------------------------------------------------
We regret that electronic text of GAO Testimony is not available at
this time.
See the GAO FAQ - Section 2.0 for printed copy ordering information.
The FAQ is automatically retrieved with all WAIS search results or
can be obtained by sending e-mail to: info@www.gao.gov