EPA's Contract Management

Audit Backlogs and Audit Follow-up Problems Undermine EPA's Contract Management Gao ID: T-RCED-91-5 December 11, 1990

GAO discussed its review of the Environmental Protection Agency's (EPA) contract audit coverage and follow-up of audit findings, focusing on its audits of six large contractors. GAO noted that EPA: (1) heavily relied on contractor support to accomplish its mission, with contract obligations exceeding $1 billion, about one-fifth of its total budget; (2) spent the most contract dollars on its Superfund program, with estimated obligations exceeding $600 million; and (3) spent nearly 90 percent of its contract dollars on cost-reimbursable contracts with few cost-control incentives for contractors. GAO also noted that: (1) EPA had a serious backlog of incurred cost and financial audits; (2) contract closeouts were untimely partly due to audit backlogs; (3) auditing agencies' low priority on incurred cost audits, the EPA Inspector General's (IG) audit coordination and management problems, resource limitations, and funding delays contributed to audit and closeout delays; (4) EPA needed timely audits to effectively manage contracts and to deter and detect waste, fraud, and abuse; and (5) EPA failed to develop a reliable audit follow-up system to track corrective action progress and identify weaknesses for management attention.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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