Management of the petroleum pricing violation escrow account

Technical Report · Thu Oct 31 00:00:00 EST 1985

OSTI ID:6503112

The objectives of review were to determine if internal accounting and administrative controls over the escrow account were adequate to ensure that (1) monies due were collected and properly accounted for, and (2) distribution of funds was in accordance with legal requirements. DOE does not have a unified accounting system to control the escrow fund. ERA was given the responsibility for ensuring that payments and interest are collected and has assumed the responsibility for maintaining associated accounting and reporting systems. The Controller was given the responsibility for overall financial management of the monies in the escrow account. Because of the division of responsibilities, the Controller's system was not designed to provide accurate information on the amounts of principal and interest due and collected. Since the Controller lacks responsibility for escrow account receivables, the program office's actions are not subjected to certain internal control features inherent in good accounting systems. Also, the Controller maintains dual accounting systems to control disbursement from the escrow funds. The need to consult different source records, together with communication problems among the parties involved in administering refunds, contributed to a pattern of incorrect payments from the escrow account. We consider the current assignment of responsibilities and the awkwardness of accounting for the $200 million disbursements to constitute significant weaknesses in internal controls over the escrow account. We believe the accounting systems and procedures should be modified to: more accurately account for receivables, generate more meaningful reports, validate the accuracy of refunds to claimants, and properly reconcile the amounts in subsidiary accounts. As a first step, DOE needs to identify which escrow sub-accounts should absorb the $200 million congressionally mandated disbursement.

• Research Organization: USDOE Office of Inspector General, Washington, DC
• OSTI ID: 6503112
• Report Number(s): DOE/IG-0221; ON: TI86001562
• Country of Publication: United States
• Language: English

Related Subjects

02 PETROLEUM
29 ENERGY PLANNING
POLICY AND ECONOMY
ESCROW ACCOUNTS
AUDITS
PETROLEUM
PRICING REGULATIONS
US DOE
ACCOUNTING
ADMINISTRATIVE PROCEDURES
CHARGES
VIOLATIONS
ENERGY SOURCES
FOSSIL FUELS
FUELS
NATIONAL ORGANIZATIONS
REGULATIONS
US ORGANIZATIONS
020700* - Petroleum- Economics
Industrial
& Business Aspects
294002 - Energy Planning & Policy- Petroleum
290200 - Energy Planning & Policy- Economics & Sociology