Audit Report: DOE-OIG-22-21

January 12, 2022

Personal Property Items Held by Subcontractors at Lawrence Berkeley National Laboratory

The Regents of the University of California (UC) have managed and operated Lawrence Berkeley National Laboratory (LBNL) under contract with the Department of Energy and its predecessors since 1943.  UC’s contract with the Department incorporated a requirement to manage property. Specifically, UC’s contract includes Department of Energy Acquisition Regulation 970.5245–1, Property, to establish, administer, and properly maintain an approved property management system of accounting, and to control, utilize, maintain, repair, protect, preserve, and dispose of Government property in its possession under the contract.  Accountable property records are managed and maintained using the Sunflower Asset Management System.  We initiated this audit to determine whether LBNL was identifying, tracking, and recording personal property items held by its subcontractors in accordance with applicable laws, regulations, and policies.  We found that LBNL’s Procurement & Property Management Group is not identifying, tracking, and recording personal property items held by its subcontractors in accordance with applicable laws, regulations, and policies.  Specifically, we found three subcontractor-acquired personal property items worth $25,961 that were not authorized by LBNL’s Procurement teams prior to acquisition.  In addition, we found six personal property items amounting to approximately $1.6 million that were not barcoded, as required.  Finally, we determined that LBNL did not always consistently administer controls on 30 administratively controlled items worth $62,791.  The issues occurred, in part, because there were no effective controls other than the subcontract itself to ensure subcontractors notified LBNL’s Procurement teams if there were any changes or purchases of personal property items.  Management concurred or partially concurred with the report’s recommendations and identified corrective actions to address the issues in the report.  Management also concurred with our suggested action.