ML20212Q341
| ML20212Q341 | |
| Person / Time | |
|---|---|
| Issue date: | 08/12/1986 |
| From: | Connelly S NRC OFFICE OF INSPECTOR & AUDITOR (OIA) |
| To: | |
| Shared Package | |
| ML20212F633 | List: |
| References | |
| TASK-PII, TASK-SE SECY-86-237, NUDOCS 8609040328 | |
| Download: ML20212Q341 (49) | |
Text
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ATTACHMENT y
["'%\ TO ENCLOSURE B
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\...../ " - ' ' - ' "
== u . 19 8J POLICY ISSUE ;
(Information) !
FOR: The Comissioners i FROM: Sharon R.' Connelly, Director 1 Office of Inspector and Auditor 1
SUBJECT:
STATUS OF AUDIT REPORTS OVER SIX MONTHS OLD PURPOSE: To inform the Comissioners of the status of recomendations contained in audit reports which are over six months old.
. DISCUSSION: Attached, in accordance with OMB Circular A-50 and NRC Bulletin 1201-4, is the semi-annual report to the Ccmission on the status of audit reports ever six months old.
This submission covers all recomendations in OIA audit reports over six months old as of June 30, 1986, which are either unresolved or open. Unresolved recomendations are those on which the Office of Inspector and Auditor (OIA) and the Execu-( tive Director for Operations (EDO) disagree as to the need for l
corrective action. Ocen recomendations are those which the i E00 has agreed to implement but en which either (1) corrective
. action.has not been ccmpleted, or (2) OIA has not followed up to determine whether corrective action has been taken.
This submission also covers unresolved recommendations in General Accounting Office (GAO) reports and the Division of Centracts (DC) report on unresolved questioned costs.
During the period from January 1, 1986, through June 30, 1986, 55 recomendations in OIA audit reports were resolved. There were five unresolved recomendations over six months old as of
' June 30, 1986. One of those is contained in CIA's March 12, 1985, report entitled "Use of Consultants at Waterford," one is contained in OIA's May 31, 1985, report entitled " Review of NRC's Allegations Management System," cne is in OIA's June 21, 1985, report entitled " Review of the Staff's Implementation of l
the Interim Procedures for Managing Plant-Specific Backfitting of power Reactors," and two are in OIA's October 21, 1985, report entitled " Storage of Sensitive Records at NRC's Warehouse." We did not believe these recc = endations to be significant enough to warrant referral to the Comission for
~ resolution. We therefore plan to reassess the need for corrective action in those areas during our follow-up reviews NM9 03N on those reports.
l Yf CONTACT: Fred Herr, OIA 49-24457
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During the past six months, OIA followed up on 74 open recom-mandations and closed 62 of them. The attached status contains 23 reports with 90 open recomendations. The audit reports are listed chronologically in appendices to this paper with the oldest report first.
The ED0's Office has informed us that as of June 30, 1986, there were no unresolved GA0 recomendations over six months old. Stx GA0 recomendations were resolved during the past six months.
The Division of Contracts (DC) has provided information on outside audits of NRC contracts. DC informed us that there was one audit report over six months old containing unresolved questioned costs (see Appendix X page 44). There were no audits involving questioned costs resolved and no collections, offsets, write-offs or demands for payment during the reporting period.
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[j Sharon R. Connelly, Director Office of Inspector and Auditor
Attachment:
Semi-Annual Report DISTRIBUTION: *
. Comissioners
> OGC (H 5treet)
_ OIA -
EDO SECY i
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Reports containing Open Recommendations over Six Months Old Page Appendix A Review of NRR's Operating Reactors Licensing Action 1 Program.
Review of Automatic Data Processing Security 2 8
Review of NRC's Reactor Safeguards Program 3 C
D Resfew of Controls Over Year-End Spending 5 OIA Inspection of the Travel Advance Operations and the 7 E
Related Internal Controls OIA Report on Work Hours and Premium Pay for Employees 9 F
in the NRC Operations Center Interface of the Automated Personnel and Payrcil Data 12 G
Systems 13 H Survey of Research Direction, Management and Utilization Review of the Operating License Review Process for 14 I
Power Reactors OIA's Review of NRC's Policies and Procedures Relating 17 J
- to Differing Professional Opinions 18 !
" K Federal Managers' Financial Integrity Act (1984)
Review of the Office of Inspection and Enforcement's 20 L
Materials Inspection Program 22 M Use of Consultants at Waterford 23 N Survey of the Office af the General Counsel 24 0 Review of NRC's Vehicle Use
- 25 P Review of NRC Regionalization Review of NRC's Allegations Management System 27 Q
31 R Review of the Staff's Implementation of the Interim Staff Procedures for Managing Plant-Spectfic Backfitting of Power Reactors
5 Audit of Selected Aspects of NRC's Payroll Operations 33 T Review of Anonymous Allegations Regarding the Senior 36 Executive Candidate Development Program U Storage of Sensitive' Records at NRC's Warehouse 37 Y Review of the Office of Small and Disadvantaged 39 Business Utilization and Civil Rights W Federal Managers' Financial Integrity Act (1985) 43 X Report on Outside Audits of NRC Contractors 44 e
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. . l Appendix A l Page I of 1 Review of NRR's Operatino Reactors Licensina Action Procram This report was issued on July 31, 1981, and contained eight recommendations.
On September 7, 1983, CIA issued a follow-up report closing three of the eight recomuendations. Additional follow-up work was perfomed in February 1984 June 1984, and June 1985, resulting in four additional recomendations being closed. We will follow-up on the remaining open recomendation when the staff completes action on it.
Recomendation NRR management assign a.high priority to completion of proposed changes to 10 CFR 50.36 and 50.54 to reduce the number of incoming routine operating reactor licensing actions and enable the staff to devote more effort to matters directly related to safety.
E00 Response A proposed rule will be submitted to the Comission in August 1981, which will recossend revisions to 10 CFR 50.36 and 50.54 that would include a redefini-
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tion of a Limited Condition for Operation and remove certain administrative and surveillance requirements from the technical specifications of future licensed facilities. These changes would be optional for those plants which are presently licensed. The effects of these changes would be expected to reduce the number of incoming routine, non-safety related licensing actions.
Current Status j
Proposed changes to 10 CFR 50.36 and 50.54 were issued for public coment in i
1982. A study perfomed by the Technical Specification Improvement Project l concluded that the objectives of the rule changes could be achieved more .
- l. . expeditiously through a policy statement. This Policy Statement is scheduled
- to go to the Comission for review in August 1986 and is expected to be issued '
in late January 1987.
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. . Appendix C Page 1 of 2 i
Review of NRC's Reactor Safecuards Procram This report was issued on April 6,1983, and contained 24 recomendations.
Based on our follow-up work in June and December 1984, 22 of the recossendations have been closed. Follow-up work on the remaining open recomendations' is scheduled for FY 1987.
Recommendation In order to ensure more consistent review and application of NRC's safeguards requirements we recessend that the Office of Nuclear Material Safety and Safeguards:
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-- more clearly define in the guidance documents the minimum safeguards program required by 10 CFR 73.55 and related appendices to reduce the degree of judgment and uncertainty now prevalent in the licensing process; and
-- assign a high priority, with established due dates, to upgrading the existing guidance to make it more useful to the staff and responsive to
. licensee needs.
E00 Response With the exceptions of additional guidelines regarding compensatory measunes, and certain revisions to Regulatory Guides 5.12 and 5.44, we continue to believe that the guidance available during the audit period satisfies present needs. NUREG-0908, " Acceptance Criteria for the Evaluation of Nuclear Power Reactors Security Plans," which was developed in early 1982 and published in August of that year, consolidates into one document the guidance previously contained in multiple sources. -
5 A guidance document for compensatory measures will be. completed by ,
" September 30, 1983. Revisions to Regulatory Guides 5.12 and 5.44 will be !
completed by February 1, 1985.
Current Status Draft revisions to Re;alatory Guides 5.12 and 5.44 are being reviewed within NRC and are expected to be issued in August 1986 and April 1987, respectively.
Recomendation l
l In order to standardize inspection techniques so as to ensure consistent application of requirements, .+ recommend that the Office of Inspection and Enforcement (IE) provide trair workshops for inspectors to gain a fuller understanding of the modules and to share inspection experiences with inspectors from other regions.
ECO Response IE agrees that training workshops for the cur;ose of understanding modules and sharing experiences would be worthwhile. To date, due to staff time and 3
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Appendix 0
- Page 1 of 2 Review of controls Over Year-End Soending This report was issued on September 15, 1983. It contained six recomen-dations to facilitate improvements in the canagement of year-end spending. We are following up on these recomendations as part of our current review of NRC's contracting operations.
1 Recomendation '
The ED0 deobligate unneeded funds by:
a) Continuing to close out expired contracts, emphasizing contracts with the greatest uncosted balances; and b) Requiring justification of uncosted balances with limited activity prior to the end of the fiscal year.
E00 Response a) We agree. We estimate that during FY 1983 we will de-obligate $600,000
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in unneeded funds. We will revise our May 11, 1982 policy statement on this subject to emphasize uncosted balances as a factor in determining l
l which contracts to close out first. This will be accomplished by September 30, 1983.
b) We disagree. As contracts continue to expire each month, a backlog natural'y develops. These are then addressed in the priority established in our May 11, 1982 policy statement. We would prefer to use our staff resources to actually close out the contracts rather than " justify" why uncosted balances remain at the end of each fiscal year. -
Recomendation The EDO should coordinate with institutions and other Government agencies to assure financial reports are submitted promptly and assets and uncosted balances are more accurately reflected in agency financial reports.
EDO Response We agree. Although no specific contracts were mentioned in the report as requiring correction, we agree with the principle stated and will continue to comply.
Recomendation The EDO improve grant management by:
a) Developing a system to assure grantees submit required financial reports within the time limits specified by the unifonn administration require-ments for grants OMB Circular A-110; l b) Basing the method of payment for grants on the financial requirements of l
the grantee.
5
Appendix Pagel of 2 i OIA Inspection of the Travel Advance Operations and the Related Internal controls This report was issued to the EDO on January 30, 1984, and contained nine recossendations. One of the recossendations was closed at the time the
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inspection report was issued. During June 1986 we followed up on this report and found that six of the remaining eight recommendations had been implemented. Follow-up work on the remaining open recommendations will be performed in the near future.
Recommendation The Dirtetor, RM, require RM/A to assign alternate cashier responsibilities to an employee that does not have related travel advance duties.
E00 Response Allowing the same person to be an alternate cashier and perform travel advance duties could possibly compromise intarnal controls. Consideration has been given to the complete segregation of these two duties but due to staffing
- limitations this is not practicable. However, all cash advances made by an alternate cashier will be listed by the principal cashier and provided to the Travel Accounts Unit supervisor.
Current Status Because cash advances by alternate cashiers are not being listed by the principal cashier as the E00 indicated would be done, this recomendation remains open.
Recomendation
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The Directer, RM, require RM/A to determine which employees have left the ,
agency owing travel advance funds, and what action can be taken to collect these fundr.
E00 Response Nomally, a terminating employee's final pay check is recuced by the amount of any outstanding travel advance balance. OIA provided a schedule of 15 teminated Headquarters employees with outstanding travel advance balances aggregating $2,599.87. The balances of three of these terminated employees have recently been settled. RM/A will take the following actions:
- a. Pursue collection of travel advance balances from the remaining 12 terminated Headquarters employees,
- b. Identify travel advance balances due from teminated regional office employees and pursue collection of such balances.
- c. Identify weakness in internal controls and take action to correct such weaknesses. Review will be completed by June 30, 1984, and your office will be so advised.
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Appencix F Page 1 of 3 OIA Report on Work Hours and premium Pay for Employees in the NRC Operations Center This report was issued on June 14, 1984, and contained six recommendations.
In an August 8. 1984, memorandum, the EDO provided OIA with supplemental coments on CICs recomendations. We have completed a follow-up on the recomendations in this report and expect to issue a report in July 1986. j Recommendation We recomend that the Director, IE, ensure that work schedule practices for the NRC Operations Center are in compliance with the applicable NRC regula-tions on minimizing premium pay.
ED0 Response ,
The current work schedule practices minimize overtime and use of compensatory time. Overtime for shift overlap, premium pay for holidays, weekends and '
night differential pay is inevitable for 24-hour duty assignments. The current use of compensatory time and overtime has been examined and the usage and controls applied are consistent with the regulations.
Occasional and irregular overtime, under current practices, is at the direc-tion of the supervisor to provide coverage of meetings or activities and to meet required due dates for work products. Compensatory time may be granted for this overtime, instead of pay, consistent with the regulations and to minimize cost.
Recomendation We recomend that the. Director, IE, tighten management controls over the
, scheduling of employees in the Center, particularly at year end, and ensure ~
that only qualified employees staff the center. .
EDO Response There clearly was difficulty at the end of CY 1983 scheduling individuals who have job descriptions as Operations Officers. This difficulty was because IE was understaffed with personnel with that job description due to attrition and l difficulty maintaining a hiring pipeline. I emphasize that qualified person-nel were on duty in the Operations Center during this time despite the scheduling difficulties and personal inconveniences.
! Recenmendation We recodmend that the Director IE ensure that duty officers discontinue the practice of compressing their workweek on a regular basis by using compensa-tory time / annual leave.
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Appendix F
. Page 3 of 3 available. The Office of the Executive Legal Director's interpretation of 5 CFR 550.122(d) cited in that decision provides that for pay purposes, an employee may receive premium pay when he or she is temporarily assigned during the administrative work week to a daily tour of duty which includes night, Sunday or holiday work. This temporary change in a daily tour of duty within the employee's' regularly scheduled administrative workweek is distinguished from a period of irregular or occasional overtime work in addition to the employee's regularly scheduled administrative workweek.
Prior to the Comptroller's decision, our practice was to allow night. Sunday and holiday premium pay only if scheduled prior to the beginning of the workweek. The decision allows these payments when temporary changes to the administrative workweek'are made even after the beginning of the workweek.
Even if updated schedules are submitted there would be instances where the T&A card did not match the schedule. Thus, it appears that nothing is gained by sending revised schedules to Division of Accounting and Finance after the beginning of the workweek. The T&A cards will be used to document the employees' actual hours of work and leave.
9 11
Appendix H Page 1 of 1 Survey of Research Direction. Manaaement and Utilization The results of our survey of the Office of Nuclear Regulatory Research were '
issued in a report dated August 3,1984, which contained two recomendations.
A follow-up review in June 1985 found that one recomendation had been implemented. We will follow up on the remaining recoemendation within the next six months.
Recossendation The Director, RES, establish Office Project Files using the alternate plan provided by NRC Sulletin 1401-3 which allows the components of this file to be maintained in more than one location.- An analysis should be perfomed to detemine the organizational unit requiring frequent access to specific components of the file. Responsibility for that component (s) should then be
. placed with that organizational unit. The analysis should include a review of all of RES' existing files regarding 00E projects to detemine if they are duplicative and should be eliminated, or if their refomatting could provide a portion of the Office Project File.
E00 Response -
RES is preparing the established Office Project Files using the alternate plan provided by NRC Bulletin 1401-3 which allows the components of this file to be maintained in more than one location.
Current Status During our follow-up, we found little had been done in establishing Office Project Files using the alternate plan in Manual Chapter 1401-3. This was partly due to a change in personnel within RES. RES estimated that resolution ~
of this recomendation would occur in December 1985.
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. Appendix I Page 2 of 3 successfully taken such reviews through the ACRS,.the hearing processes, and Cosmission reviews.
Open issues in the SERs are adequately tracked and controlled in each SER and succeeding supplements. All significant issues requiring follow-up subsequent to licensing are tracked by conditions of licenses. Coordination between NRR and IE (and in fact Regions and NMSS) has improved and responsibilities are now better defined.
Current Status ,
The Cassiission asked CIA and the EDO to work together to resolve this issue by assuring proper execution of the present (or an improved) tracking system.
The Consiission also directed the staff to review its criteria for open issues j to ensure open safety issues and the number of allegations are consistently enumerated in a meaningful and standardized manner.
On May 30,1985, the ED0 advised us of the following:
The staff has reviewed its criteria to ensure that open issues and
. the number of allegations are consistently enumerated in a meaningful and standardized manner. The new Allegations Management System for tracking allegations was implemented on April 1, 1985.
With respect to open safety issues, open items are combined when it is clear that the items are related and that a single issue is affected (e.g., diesel generator reliability). Although several open i items may be grouped under one general heading, the subsections of the SER addressing those items are orovided next to the general heading. The open item is not closed until all subsections have been closed. Therefore, we do not feel that this masks the number of issues that need to be closed out.
Currently, all open items are listed in the SER, and the disposition of the open items is provided in subsequent SSERs. Additionally, open items for plants within a year of licensing are tracked in the monthly OL Review Management Report. This report lists open items, categorizes their importance and identifies the responsible review Division / Branch. All open items are resolved prior to licensing or i are included in the license ccnditions or technical specifications.
For those open items which require Regional follow-up, a memorandum identifying the item and the action required to close it out is sent to the Region. The Regional actions are then documented in istspection reports and referenced into the SSER to close out the item. Open items identified by the Regional inspectors are tracked in the Region. Ninety days prior to the issuance of the license, the Region provides the list of the remaining Regional open items to. NRR via the 94300 letter. Closure of the Regional open items is documented prior to the issuance of the license and any outstanding open items are included as license conditions.
I 15
Appendix J Page1 of1 OIA's Review of NRC's Policies and procedures Relating to bifferino-Professional Opinions This report was issued on December 20, 1984, and contained five recomen-dations. As a result of our follow-up, we closed three of the five recommendations on December 5, 1985. We plan to follow up on the remaining recomendations as time permits. ;
Recomendation .
That the ED0 annually appoint a special review panel to review the DP0 program, and disseminate the results of the panel's review and any recomendations as required in the Manual Chapter.
EDO Respons_e As soon as the staff is able to revise the current. draft policy to take into account OIA comments in this audit, and the Comission has approved a new policy, the annual review panel will be put back on r-hedule. We would anticipate the review would be initiated after nine ('s) months' experience with
- the revised Manual Chapter.
Current Status This recomendation will not be closed out until the EDO appoints the next Special Review Panel to review the Differing Professional Opinion program.
Recomendation That the EDO distribute the recomendations of the 1982 Special Review Panel to revise the MC to the public and NRC employees. ,
. EDO Response Recomendations of the 1982 Special Review Panel will be distributed within.60 days of the time the Comission acts on the revisions to the Manual Chapter proposed by that panel. (These revisions will include OIA's suggestions as noted herein.) Any future panel's recomendations will be distributed to NRC employees when that panel's deliberations are complete and before a revision is initiated.
Current Status After our December 5,1985, follow-up report was issued we were informed that a copy of 'the Special Review Panel's recomendations were placed in the Public Document Room. We have not followed up to determine if this was done.
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Page 2 of 2 Current Status _
Because NRC did not complete all the tasks set out in OM8's evaluation guidelines for reviews of accounting systems, this recomendation will remain open.
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. . Appendix L Page 2 of 2 the regions have made rational and coordinated adjustments to the goals in view of reactive program demands.
Recommendation Require that periodic (at least yearly) meetings of Materials Inspection !
Program first line supervisors be held for the purpose of discussing mutual problems and concerns related to the materials inspection program.
ED0 Response We agree that there is a need to hold meetings between regional first-line supervisors and IE staff. An Interface Meeting of this type was held in 1983 and again in 1984. These meetings will continue on an approximately annual basis. We do not believe that there is a need for a specific written policy on the frequency of counterpart meetings. In addition, there are periodic meetings of the Interoffice Working Group, sponsored by NMSS, that is made up of fue' facility and materials representatives of the regions and the program offices. ...
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AppendixN l Page 1 of1 Survey of the Office of the General Counsel This report was issued on March 14, 1985, and contained 17 recomendations to the General Counsel. During May 1986 we followed up on this report and found that 16 of the 17 recommendations had been implemented.
Recommendation -
Er.sure that internal management review processes are in place; originators, reviewers and managers formally concur in and approve documents prior to release by OGC; and the concurrence copy of documents is maintained.
0GC Response We agree. OGC intends to review its internal management review processes and institute improvements as appropriate. Related to this, OGC will institute a process of formal concurrence for originators, reviewers and managers prior to a document's dispatch from the office. Concurrence copies of documents will be maintained.
Current Status During our follow-up we found that OGC h'ad made a determination that documents which were litigation, conflict of interest, routine or trivial, or signed by the writer did not require concurrence copies. We did not agree that all litigation documents and memoranda requesting extentions of target dates should be excluded. We will follow up on the reccmendation within the next six months.
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' - . Appendix p Page 1 of 2 Review of NRC Regionali24 tion This report was issued on April 30, 1985, and contained seven reconmendations intended to correct the specific problems addressed in our report and to enhance the overall effectiveness of the program areas reviewed. To date no follow-up work has been performed. Follow-up work for the seven recossendations is scheduled for FY 1987.
Recommendation The Cosmissidh, through the EDO, clarify the authority of the Regional Adminis-trators. ,
EDO Response We believe the authority of the Regional Administrators, asr specified in NRC Manual Chapter 0128 is sufficiently clear. Nonetheless, I have asked OEOR0GR to reexamine the authorlty of the Regional Administrators to ensure it is connensurate with their responsibilities.
Reconnendation .
The EDO, where feasible, encourage greater use of the oversight approach used by NMSS in its National Program Reviews to make oversight more of an ongoing
- and integrated process.
E00 Response Agree that we should achieve a better integration of our Headquarters program audits. The NMSS National Program Review process might have further applic-ability in other areas such as emergency preparedness and fuel facility licensing and inspection. IE will specifically examine ways to better inte-grate the overview process. ,
Recomendation The Director, NMSS, give high priority to finalizing the remaining guidance for materials licenses transferred in Phases II and III and assure that guidaice for Phase IV is completed before the licensing responsibility is transferred to the regions.
' E00 Response No additional guidance is necessary for Phase IV since no new types of licenses or licensing actions are required. NMSS has given high priority to the com-plation of materials licensing guidance which is now nearing completion. NMSS has performed well in keeping the regions informed through workshops, seminars and biweekly conference calls, a practice which they will continue. We do not believe additional effort is needed.
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AppendixQ
- Page 1 of 4 Review of NRC's Alleottions Manacement System This report, issued on May 31, 1985, focused on the systems NRC has in place to account for, control, track and manage allegations. The report contained twelve recommendations designed to improve NRC's processing of allegations.
The ED0 disagreed with 1 of our 12 recomendations. This reconsnendation wss not elevated to the Comission and remains unresolved. OIA has not yet followed-up on the ED0's progress in implementing the recomendations. We will place specific amphasis on the unresolved reconsnendation during our follow-up to determine if Comission action is warranted.
Reconsnandation We reconsnend that the EDO develop standardized documentation for use in 4
recording the resolution of allegations. The format could be the one used in the SER's or another acceptable fonnat. Using standard documentation will preclude the necessity for having to expend resources to prepare such documen- ,
tation at a later time.
EDO Resoonse We disagree. We appreciate the value of a comon format. At the present time, however, most allegations require an on-site inspection, are closed out in Inspection Reports (IR), and are not placed in SER Supplements (SSER). The IR provides a written characterization of the allegation and the agency action to resolve it, if substantiated. On plants having large numbers of allegations, such as Diablo Canyon, Waterford and Comanche Peak, the staff found that an SSER was required to compile all the necessary analysis ahd inspection work in i one complete document. While it may be possible to revise the IR fonnat to allow the allegation description and resolution to be lifted in its entirety and placed in an SSER, the resources required to do that in all cases do not justify the few cases in which it would be utilized.
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Current Status This recommendation is unresolved.
Recom6ndation We recomend that the EDO clarify to the staff the implementation of draft Manual Chapter 0517 pertaining to confidentiality for allegers, pending approval by the Comission of a policy statement on confidentiality.
E00 Resoonse We agree. As you know this question is presently before the Comission. When the Comission reaches a policy decision on this matter, it will be issued to r the staff with implementing guidance, and will also be incorporated in the I final version of NRC Manual Chapter 0517. We do not believe it would be I helpful to issue additional interim instructions pending a decision on this matter by the Comission, since that decision is expected momentarily.
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Appendix Q
- Page 3 of 4 (a) Change the ATS reporting guidelines to require a separate ATS number be assigned for each separate technical issue; or (b) Modify the AT5 to allow suffix numbers to be included in the ATS.
We understand tihat the EDO currently has plans to modify the ATS and we believe this recossendation should be considered in conjunction with these changes.
ED0 Resoonse .
We agree. The new AMS computer system, and the new Allegation Data Input form (307) allow for the entry of multiple concerns under one allegation number and require that this information (numoer of concerns) be provided for each allegation opened. This was also covered in the March meeting.
Recommendation We recomend that the EDO reinforce to the technical staff the policy about turning allegations over to licensees for their follow-up.
ED0 Response We agree. This guidance is presently a part of 0517 and requires that action offices assure that turning the allegation over to the licensee will not (1) reveal the identity of a confidential alleger or (2) compromise an ongoing or planned inspection or investigation. This will be reinforced to Office Directors and Regional Administrators at the issuance of the final version of 0517. It is also a standard audit item when 0517 implementation is reviewed and was also covered in the March counterpart meeting.
Recomendation -
As it appears that the task force approach may continue to be used in cases where a large number of allegations are pending against a specific licensee, se (OIA) recomend that the ED0 consider using alternative approaches to estab-lishing task forces. One such approach could be designating specific NRC officials who have been involved with previous task forces and would have the necessary experience regarding workload planning and supervision of task force resources. This should alleviate some of the problems encountered by earlier task forces.
ED0 Response We agree with the thrust of this recommendation, but we do not believe that the designation of NRC officials on a permanent basis to handle any task force effort that might arise is feasible. The regular workload of potential task force leaders must be considered at the time of the assignment. If tr..ik forces are necessary in the future, we intend to draw upon the experience of success-ful task force leaders. If they are not available by reason of workload to head the effort, we will make them available on a consultation basis during the start-up of any new task force.
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f Appendix R
. Page 1 of 2 Review of the Staff's Imolementation of the Interim Procedures for Managin1 Plant-5pecific Backfitting of Power Reactors This report was issued on June 21, 1985, and contained five recomendations to l
improve the procedures contained in draft Manual Chapter 0514 and NRC's manage-ment of plant-specific backfits. In comenting on our report, the E00 dis-agreed with one of our recomendations. After our report was issued, we discussed the recomendation with which the EDO disagreed with the Director, -
Regional Operat. ions and Generic Requirements Staff. That meeting clarified the issues to both parties but did not resolve the disagreemer.t. This recommendation remains unresolved. We agreed to relook at this recomendation during our follow-up. To date no follow-up work has been performed.
Recommen'dation We recommend the EDO assure tnat the additional improvements to MC 0514 we
- identify on pages 7 and 3 of our report are included in the revisien to ,
i MC 0514.
ED0 Response j The E00 generally agreed with three and disagreed with two of the five additional improvements to MC 0514 recomended to effectively control the imposition of plant specific backfits by the NRC staff. -
Recomendation We recomend that the EDO provide guidance to Office Directors / Regional Administrators as to how issues which would be backfits under the current definition in 10 CFR 50.109 but which will not be backfits under the revised
. definition of backfits in revised MC 0514 are to be handled.
5 EDO Response ,
i.
The revised MC 0514 is the guidance to Office Directors / Regional Administrators referred to in the recomendation. The April 12, 1985, directive signed by V. Stallo, Jr., DEDROGR, clearly states that staff practice shall, as of May 1, 1985, be consistent with the policy expressed in MC 0514, and that detailed office procedures will be written and approved by E00 to implement that policy.
MC 0514 clearly describes that the licensing milastone from which changes will be backfits is, for plants in the operating license review stage, 6-months prior to docketing for operating license review. This milestone is clearly established in the backfit definition in MC 0514 and is different from the current 50.109. We feel there is no ambiguity and no further need for clarifi-cation.*as the staff has been directed to use MC 0514 and has been trained in its use.
Current Status, This recomendation is unresolved.
31
- Appendix 5 Page 1 of 3 Audit of Selected Aspects of NRC's Payroll Operations This report was issued on July 5,1985. and contained 27 recomendations. In May 1986 we followed up on this report and found that 19 of the 27 recomen-dations had been implemented. We expect to follow up on the eight open recomendaticas during the next six months.
Recommendation Ensure a fully operational control desk function is established and that the individual assigned this function is not given other responsibilities which would negate the controls.
EDO Response Increased attention is being given to assure the performance of control desk functions described in the Automated Payroll Systems Users Manual. However, the current staffing and staff experience levels in RM/A impose limitations as to the manner in which the control desk functions are performed. The -
performance of the control desk functions should still satisfy the General
~
Accounting Office that there is a reasonable assurance that payroll documents
- are processed properly.
Current Status The Director, RM/A, plans to reevaluate everything the control desk function needs to perform in light of other internal control mechanisms which are now in place.
Recomendation
. Assign a high priority to the updating of the Automated Payroll System Users ~
Guide. The Users Guide should also be revised as necessary to improve the
[ guidance available to the staff. It should include detailea procedures to be.
followed by the staff for performing the control desk function; balancing and-reconciling output reports; handling and distributing output reports; processing and documenting supplemental payments; processing military leave; and documenting miscellaneous earning and deductions and evidence that Forms W-4 for employees claiming allowances in excess of 14 are sent to IRS. i EDO Response The Payroll Section Chief will establish a framework for a desk procedures manual and will commence writing sections for the manual as time pemits. As additional staff positions become available, they will be assigned to the document'ation effort which will require four to five months of full-time effort by an experienced accountant familiar with the current automated payrc11 system. This effort should be completed by the end of fiscal year 1988.
Current Status Desk procedures to be used by the Payroll staff had been delayed and this was to be one of the first assignments of the new Payroll Section Chief once one was hired.
33
I
' Appendix S Page3 of 3 statutes and NRC policy and regulations governing payroll operations. The documents that will eventually be generated in response to a previous recommendation will serve as effective training tools. However, it is not appropriate to provide training to the entire Payroll staff on seldom used regulations governing the payroll function, as suggested on page 55 of your draft report. .
Current Status Adequate payrol1 training has not been located. The Director, RM/A, stated that he is going to rely on the new Payroll Section Chief to fulfill the staff's training needs until a suitable course can be found.
Recommendation Place the additional staff member contemplated for the payroll unit in RM/AFS until such time ~ and the realignment of the payroll staff has been assessed and the backlog of system tasks is at a manageable level.
ED0 Resoonse Due to current staffing constraints, additional staff cannot be made available to the Office of Resource Management. The Director, RM, and Director, RM/A, must determine how to most effectively allocate the positions available to the office; I have been advised that at this time there are not positions that could be reassigned to payroll functions. Every effort will be made with existing staff, and in recognition of the priorities discussed in response to Recommendation 6, to address the significant tasks for modifications to payroll system computer programs.
Current Status .
The Director, RM/A, stated that all of RM/A's operation needed to be reviewed for staffing levels. Also, he wanted to review the payroll system modification list with the Director, RM, in order to decide what modifications were in fact required.
Recommendation Develop written procedures to document the system errors, modifications which have not been rectified, and the methods to be used by the payroll staff to adjust for problems they will encounter in these areas. .
EDO Response These procedures should be limited to the methods to be used by the Payroll Section to compensate for problems in the automated payroll system and to manually handle functions which are not yet automated. These procedures will be developed on a piecemeal basis until an individual can be assigned full time to this task.
Current Status No work had been done to implement the reccmmendation.
35
, _._ _~.! - . . _ . , _ , _ , - - _ . , _ . __, . _ _ _ _ _ . _
- - Appendix (;
Pagel of 2 Storace of Sensitive Records at NRC's Warehouse This report was issued to the Office of Administration on October 21, 1985, and contained four reconmendations. Two of the reconnendations are unresolved but they will not he elevated to the Commission for resolution because of their minor nature. We will follow up on this report in the near future.
Recommendatio_n We recommend that the Division of Technical Information and Document Control (TIDC) take action to assure that all sensitive records located at the warehouse are properly stored and secured.
E00 Response After reviewing the procedures at the NRC Warehouse, NRC Manual Appendix 2101, Part IV, paragraph c. Protection of Documents When Unattended, TIDC concludes that all sensitive records, including OIA records, located at the Warehouse are properly stored and secured in accordance with the guidance in the Manual. We, nevertheless, understand OIA's special concern over storage of their records, i.e., the accessi6111ty of CIA audit and investigative records to warehouse personnel and warehouse visitors. TIDC has transferred all OIA records from the NRC warehouse to a facility accredited for classified records storage. By separate memorandum dated October 21, 1985 TIDC notified your Records Liaison Officer...about this arrangement.
Reconnendation We reconnend that the Division of Technical Information and Document Control take action to assure that the doors to the security cage are repaired and remain locked when not in use.
E00 Response There is no request to provide s locked repository for Official Use Only infonnation which is stored under a guarded area. The warehouse is guarded during business hcurs and locked up at other times. Thus the cages are not required and are not, therefore, being maintained.
Recommendation We reconeend that the Division of Technical Information and Document Control take action to insure that contact with MAXIMA for the storage and handling of NRC reco,rds is monitored in compliance with record storage requirements.
E00 Response TIDC has reviewed its contract with MAXIMA and is satisfied that it is being monitored in accordance with records storage requirements. The contractor is not required by the contract to place sensitive records inside the broken security cages or to lock the cage doors.
37
. AppendixV Page 1 of 4 Review of the Office of Small and Disadvantaged Business ut111zation and C1v11 R10Rts
{
This report was issued on October 22, 1985. It contained 16 recome9dations 1 intended to clarify the ED0's authority over the Comission staff offices for the EE0 program, to improve in the contracting process, and to improve the !
management of and reporting on the EE0 program. In addition, we made recomen- .
dations intended to improve the effectiveness of the EE0 adviscry eqmmittees and 0508U/CR's relationship with the comittees. We will follow up on all recomendations during FY 1987.
Recomendation ,
We recomend the EDO, in'his role as administrative head of the agency, clarify his authority over the Comission staff offices for the EE0 program.
E00 Coment Concur. Manual Chapter 4140, Equal Opportunity In Government Emoloyment, which
. is scheduled to be issued by December 1985, will clarify the ED0's authority for the Agency's EE0 Program.
ReconsnendaUon To improve the processing of contracts, we recommend the Director. 05080/CR, provide the Division of Contracts with a written response either recomending or not recomending a small business set-aside after the review of every RFPA package.
E00 Response .
- Concur. This procedure will be implemented effective October 1, 1985. '
i.
Recomendation The Director, OSDBU/CR, finalize Manual Chapter 4140 on the Agency's EE0 program.
EDO Response Cencur. Manual Chapter 4140 is scheduled to be issued by Cecember 1985.
t Re_come,ndation The ED0' ensure that NRC complies with the EE0 briefing and reporting i
requirements of the Energy Reorganization Act of 1974, as amended, until such
! time as these requirements are rescinded.
E00 Response Concur. Comission EE0 briefings resumed in 1984 and will centinue on a l
semi-annual basis. The Agency will resume submitting quarterly reports to the Congress on hires and promotions of minorities and women, beginning the 4th l 39
Appendix V Page 3 of 4 I
Reconnendation The Director. 0500U/CR, provide the ED0 with quarterly reports on the status of the Agency's implementation of the goals contained in the Consoifdated EE0 LProgram Plan.
EDO Response Concur. The Director. OSDSU/CR, will submit the first quarterly report to the ED0 in October 1985.
Recommendation The Director. 0$08U/CR, comply with the requirements of Manual Chapter 0142 and revie e the record on any individual complaint of discrimination before a final decision is made and make reconnendations, as appropriate, to the Commission or the EDO.
EDO Response ,
- The Director, OSD8U/CR, does comply with the provisions of Manual Chapter 0142.
The purpose of this Chapter is to provide the Director, OSDSU/CR, a mechanism for rendering an opinion on a case should there be disagreement on the conditions reached by an EE0 Officer who is charged with responsibility to prepare the formal recossendation on the disposition of a case to the EDO.
OSD8U/CR participates fully in the decision making with regard to all final determinations on complaints of discrimination. The investigative file is reviewed by OSDSU/CR, ELD, and the EE0 Officer. 0$08U/CR arranges meetings with ELD staff, the EE0 Officer, and OSD8U/CR to discuss the merits of
, allegations and the possibility of settlement. Discussions with the D/ED0 on the case are also participated in. No actions regarding EE0 cases are taken .
5 without full involvement of OSDSU/CR. ,
Recommendation The Director, OSDBU/CR, improve the discrimination complaint filing system to ensure accountability and control over the files.
I EDO Response Concur. OSD8U/CR is reorganizing the discrimination complaints f.iling systcm.
New filing system should be in place by November 1995.
Recommendation The Director, OSDBU/CR, include in the complaint files, a summary schedule which shows the current status of each complaint.
EDO Response Concur. The development of a summary sheet reflecting the current status of all EE0 complaints is underway. Summary sheet should be in use by November 1985.
41 i
i
AppendixN Page 1 of i Federal Manaaers' Financial Inteerity Act (1985) on December 17.1985. 0!A issued a report on its review to detemine whether the evaluation of the system of internal accounting and administrative control, as described in Guidelines for the Evaluation and Improvement of and Reporting on Internal Control systems in the Federal Government has been carried out in a reasonable and prudent manner in the NRG for the year ended December 31, 1985.
The results of our review indicated the agency has accomplished a_ great deal during 1985 and has coripleted the two-year cycle as provided by OMB. We believe the ag4ncy now has the management infrastructure in place to enable it to comply with the requirements of Section 2 of the Federal Managers' Financial Integrity Act and OMS guidelines on evaluating internal control systems. Our report made two recomunendations to ensure that NRC complies with the intent of OMB's guidelines for evaluating the agency's accounting systems. We plan to follow up on these recosinendations as a part of our review of NRC's 1986 activities to implement tne Federal Managers' Financial Integrity Act.
Recomunendation We recomunend that the Chaircan, ICC, establish procedures to ensure that the requirements outlined in 0M3's " Guidelines for Evaluating Financial Management / Accounting Systems" are completed by mid-1986.
E00 Response The Dirzetor, RM, rather than the Chaiman of the ICC, will ensure that the requirements outlined in OM8's " Guidelines for Evaluating Financial Management / Accounting Systems" are completed by mid-1986. Except for the system for billing licensees for recoverable costs, these requirements were completed by the end of 1985.
Reconsnendation ,
" We reconenend that the Chaiman, ICC, develop a plan for the cyclical evaluation of the agency's accounting systems.
EDO Response The Director, RM, rather than the Chaiman of the ICC, will devdop a plan for the cyclical evaluation of the agency's accounting systems by Aoril 30, 1986.
43
~
. r&WM =.
Ptge 2 of 2 C. Collections, offcoto, writc-offo, demands for payment, or other monetary benefits resulting from audits closed during the report periods None D. Dette uncollected during the report period None If you have any questions regarding this matter, please let me know. .
s a -
- j. 7 ,'
b a Director Division of Contracts Office of Administration e
4 r .
e 45
\
i e . . l l
l l
l ENCLOSURE C l
CONFORMITY OF NRC ACCOUNTING SYSTEMS TO THE PPINCIPLES AND STANDARDS PRESCRIBED BY THE COMPTROLLER GENERAL I
Pursuant to Section 4 of the Federal Managers' Financial Integrity Act of 1982, the accounting systems of the U.S. Nuclear Regulatory Conunission (NRC),
in use during the fiscal year ending September 30, 1986, have been reviewed.
NRC accounting systems are identified in the financial systems inventory developed pursuant to OM8 Circular A-127, " Financial Management Systems," and are grouped according to the following functions: payroll system, administrative accounting system, system for billing licensees for recoverable costs, and prcperty accounting system. '
The results of the reviews described below, approvals already provided by the General Accounting Office for one of NRC's accounting systems, assurances given by agency officials, and other information provided indicate that NRC's accounting system, taken as a whole, generally confonn to the principles and standards developed by the Comptroller General (CG) and implemented through OMB Circular A-127, except as follows: the level of review of the system for billing licensees for recoverable costs was not sufficient to provide reasonable assurance that it generally conforms to the CG principles and standards. A detailed ICR in this area is underway at present. (See Enclosure B Section II.A.)
Payroll System The payroll system was approved by the Comptroller General on September 28, 1982. A detailed evaluation, as the tenn is defined in the OMB Guidelines, was perfonned in 1985. In 1986, the payroll system was subject to a limited review made in accordance with the Guidelines. The review gave reasonable assurance that the system is in conformance.
Administrative Accounting Systems By the end of FY 1986, the administrative accounting systems were reduced from six to four systems: a funds control system; a gereral ledger; the plant and equipment subsidiary ledger; and a system for preparation and issuance of bills. During the year, IFMIS absorbed the two systems dealing with travel i authorizations and travel advances.
NRC recognizes that there are areas of nonconformance in the first three systems but none of these are material. All four systems should be incorporated into IFMIS within the next two fiscal years. The Comptroller General has reviewed the documentation for IFMIS and has found no issues which would prevent approval of the system.
l
, _ - , ., , . ~ , _ _ . . - , . .. , _ . - . , , , - _ - _ _ , - , _ . - . . _ _ . - , , _ . ._..m.. ., . . _-.. _.
2 ,
System for Billing Licensees for Recoverable Costs An interral control review as prescribed by CMB Circular A-123 has been placed under contract and is scheduled to be completed in July 1987 (see Enclosure B,Section II.A). The internal control review will encompass a detailed evaluation of the system as prescribed in the OMB Guidelines.
Property and Supply System (PASS)
The property and supply system was subject to a limited review in accordance with the OM8 Guidelines. The review gave reasonable assurance that PASS conforms to the OMB Guidelines.
.w, -+- ,<m--, -
4 m.,,---.v --- , - - - - . - - - , , ,
w ,,- ,, _ _ - - -- . w_ _ _--- _ _ _
- e,-Wu . , 1
- - . pip 2 cf 2 l 4 .,
l C. Callections, oHcsto, write-sf f o, comanCO for pnyment, or l other monetary benefits resulting from audits closed during the report periods None D. Debts uncollected during the report period None If you have any questions regarding this matter, please let me know. .
s e d
, 7
. __. - L a Director Division of Contracts Office of Administration l
l a
e r .
O i 45 l
l l
f Appendix W Page 1 of 1 Federal Managers' Financial Intearity Act (1985)
- On December
- 17. 1985 OIA issued a report on its review to detemine whether the evaluation of the system of internal accounting and administrative control, as described in Guidelines for the Evaluation and Improvement of and Reporting on Internal Control 5ystems in the Federal Government has been carried out in a reasonable and prudent manner in the NRC for the year ended December 31, 1985.
The results of our review indicated the agency has accomplished a great deal during 1985 and has completed the two-year cycle as provided by OMB. We believe the ag4ncy now has the management infrastructure in place to enable it to comply with the requirements of Section 2 of the Federal Managers' Financial Integrity Act and OM8 guidelines on evaluating internal control systems. Our report made two recommendations to ensure that NRC complies with the intent of OM8's guidelines for evaluating the agency's accounting systems. We plan to follow up on these recosmendations as a part of our review of NRC's 1986 activities to implement the Federal Managers' Financial Integrity Act.
Recommendation We recommend that the Chaiman, ICC, establish procedures to ensure that the requirements outlined in OM8's " Guidelines for Evaluating Financial Management / Accounting Systems" are completed by mid-1986.
.E00 Response The Director, RM, rather than the Chairman.of the ICC, will ensure that the requirements outlined in OM8's " Guidelines for Evaluating Financial Management / Accounting Systems" are completed by mid-1986. Except for the system for billing licensees for recoverable costs, these requirements were completed by the end of 1985.
~
Recomendation ,
" We recommend that the Chairman ICC, develop a plan for the cyclical evaluation of the agency's accounting systems.
EDO Response The Director, RM, rather than the Chaiman of the ICC, will develop a plan for the cyclical evaluation of the agency's accounting systems by April 30, 1986.
43 4
f e...
ENCLOSURE C CONFORMITY OF NRC ACCOUNTING SYSTEMS TO THE PPINCIPLES AND STANDARDS PRESCRIBED BY THE COMPTROLLER GENERAL Pursuant to Section 4 of the Federal Managers' Financial Integrity Act of 1982, the accounting systems of the U.S. Nuclear Regulatory Conunission (NRC),
in use during the fiscal year ending September 30, 1986, have been reviewed.
NRC accounting systems are identified in the financial systems inventory developed pursuant to OMB Circular A-127, " Financial Management Systems," and are grouped according to the following functions: payroll system, administrative accounting system, system for billing licensees for recoverable -
1-costs, and property accounting system.
The results of the reviews described below, approvals already provided by the General Accounting Office for one of NRC's accounting systems, assurances given by agency officials, and other information provided indicate that NRC's accounting system, taken as a whole, generally confom to the principles and standards developed by the Comptroller General (CG) and implemented through OM8 Circular A-127, except as follows: the level of review of the system for billing licensees for recoverable costs was not sufficient to provide reasonable assurance that it generally conforms to the CG principles and standards. A detailed ICR in this area is underway at present. (See Enclosure B Section II.A.)
Payroll System The payroll system was approved oy the Comptroller General on September 28, 1982. A detailed evaluation, as the tenn is defined in the OM8 Guidelines, was perfonned in 1985. In 1986, the payroll system was subject to a limited review made in accordance with the Guidelines. The review gave reasonable assurance that the system is in conformance.
Administrative Accounting Systems By the end of FY 1986, the administrative acccunting systems were reduced from j six to four systems: a funds control system; a general ledger; the plant and equipment subsidiary ledger; and a system for preparation and issuance of bills. During the year, IFMIS absorbed the two systems dealing with travel authorizations and travel advances.
NRC recognizes that there are areas of nonconfnrmance in the first three systems but none of these are material. All four systems should be incorporated into IFMIS within the next two fiscal years. The Comptroller General has reviewed the documentation for IFMIS and has found no issues which would prevent approval of the system.
- _ u ._ _ __. _ ._ _. _ _ _ _ . _ _ . _ _ _ . ___ _ _ _ _ _ _ _ . _ _ _ _ _ .
__