The Office of Inspector General audit report on the U.S. Department of Energy`s efforts to increase the financial responsibility of its major for-profit operating contractors

Technical Report · Sun Nov 01 04:00:00 EST 1998

DOI:https://doi.org/10.2172/290894· OSTI ID:290894

In 1994, the Departmental contract reform team recommended that the Department`s major for-profit operating contractors assume greater financial responsibility. IN response, the Department developed model contract provisions to increase contractor financial responsibility and accountability. The objective of the audit was to determine if the Government is protected from liabilities such as fines, penalties, third-party claims, and damage to or loss of Government property incurred by contractors who manage and operate Department facilities and sites. The Government was not adequately protected against contractor created liabilities on 16 of its 20 major for-profit operating contracts awarded by the Department of Energy. The auditors recommend that the Director for Procurement and Assistance Management negotiate changes in major for-profit operating contracts to include contract reform liability provisions and ensure that performance guarantees with indemnification provisions are executed with subsidiary contractors` parent or corporate business entities. They also recommend that the Director for Procurement and Assistance Management issue regulatory rulemaking that requires indemnification provisions be included in performance guarantees signed by the parent or corporate business entity of subsidiary contractors.

• Research Organization: Dept. of Energy Office of Inspector General, Office of Audit Services, Washington, DC (United States)
• Sponsoring Organization: USDOE Office of Inspector General, Washington, DC (United States)
• OSTI ID: 290894
• Report Number(s): DOE/IG--0432; ON: TI99000458; NC: NONE
• Country of Publication: United States
• Language: English

Related Subjects

99 GENERAL AND MISCELLANEOUS
AUDITS
CONTRACTORS
INDEMNIFICATION AGREEMENTS
LIABILITIES
LIABILITY LIMITATIONS
RECOMMENDATIONS
US DOE