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Overbilling and billing without the knowledge or approval of Los Alamos National Laboratory officials by its largest subcontractor are key findings in an Office of Inspector General report released Monday.
Without alleging fraud, the IG's inspection identified accounting procedures that allowed KSL Services to bill some $41 million in charges above initial estimates in 2006. Inspectors found a regular pattern of projects coming in substantially over budget, according to the report.
Inspectors reviewed 94,561 estimates of work-order tasks from January 2005 through April 2007 and revealed what they considered a systemic problem where actual costs frequently exceeded estimates, often by significant amounts.
"This can negatively impact the ability of KSL and LANL facility personnel to effectively manage the cost of work performed and the allocation of labor and material charges," they wrote.
Inspectors found internal control weaknesses associated with the accounting program called PassPort, which may have contributed to problems with work order charges and costs. PassPort has the capacity to accept monetary ranges on all work orders to limit work order charges and to alert LANL when potential problems arise. But according to the report, these capabilities had not been utilized.
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