The Government Accountability OfficeÂ called on the Department of Energy to improve oversight of its subcontractorsÂ after a recent review found that the department had failed to audit overÂ $3.4 billion in subcontracts over the past 10 years. GAO issued a report on Tuesday highlighting the improper auditing process at DOE and the challenges inÂ tracking subcontract ownerships in the departmentâs multi-billion dollar programs.
The report cited that in 2016 many companies who had prime contracts with DOE also served as subcontractors to some deals. GAO questioned nearly 3,000 subcontracts that received up to $927 million from DOEâs fiscal year 2016 obligations. The government watchdog also found the department hasÂ failed to issue procedures or guidance for local offices to monitor contractors andÂ conduct subcontract audits in a timely manner.
âWithout such procedures or guidance, unallowable costs may go unidentified,â GAO explained. âLocal officials do not independently review information on subcontractor ownership because doing so is not required, although such information could alert officials to potential conflicts of interest.â
GAO recommends that DOE requires offices to monitor contractors for subcontract audits andÂ requires officials to independently review subcontractor ownership information. The departmentÂ agreed with most of the recommendations, expect independent reviews of subcontractor ownership information.