U.S. Environmental Protection Agency	15-P-0007
~	October 29, 2014
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At a Glance
Why We Did This Review
The U.S. Environmental
Protection Agency (EPA),
Office of Inspector General
(OIG), received a hotline
complaint about a U.S.
Chemical Safety and Hazard
Investigation Board (CSB)
contract awarded for about
$1 million. In response to the
complaint, the OIG initiated an
audit to determine whether
CSB effectively manages its
contracts. The EPA Inspector
General is also the Inspector
General for CSB. While our
audit work continues, this early
warning report addresses
issues of concern that we
believe need immediate
attention.
This report addresses the
following CSB goal:
• Preserve the public trust by
maintaining and improving
organizational excellence.
Early Warning Report: Not Following Internal Controls
Put Acquisitions at Risk
Send all inquiries to our public
affairs office at (202) 566-2391
or visit www.epa.gov/oiq.
The full report is at:
www.epa.aov/oia/reports/2014/
20141029-15-P-0007.pdf
What We Found
CSB did not implement internal controls designed to
ensure that acquisitions (interagency agreements,
contracts and purchase orders) over $50,000 receive
Board approval. In addition, CSB did not maintain
records in its acquisition files. Our findings indicated
the following:
Over $1.9 million in
CSB acquisitions are
at risk because the
Board did not approve
the acquisitions.
•	CSB had 14 acquisitions over $50,000 that did not obtain the required
Board approval. In addition, we identified one contract that had
modifications totaling over $100,000 that were not Board approved.
•	CSB did not record its market research actions for two contracts that
totaled over $380,000.
•	CSB did not record its quality assurance surveillance plan actions for
seven sampled contracts that totaled over $1.4 million.
By not following internal controls defined in Board orders, the CSB put funds at
risk. In addition, by not recording its compliance with federal acquisition
regulations, CSB acquisition files show limited evidence that the agency has
awarded contracts that are the best value for the government and that the
agency has received goods and services for which it paid.
Agency Positions
There were dissenting views within CSB. A management official stated,
"...B[oard] 0[rder] 028 has been removed from the CSB's website, and the
agency is currently reviewing the order to determine which provisions remain
legally operative. Provisions of the Order requiring Board [']approval['] for the
awarding of contracts, functions, other activities required by law, or other valid
executive agency requirements, are not in force." A Board member stated
"...Board Order 28 can be modified but any modification would be subject to
Board approval. Also,"... [unilateral invalidation of Board Order 28 not only
touches contracting issues but also impacts the core issue of agency
governance."
CSB stated it registered all contracts over $150,000 in the Contractor
Performance Assessment Reporting System database and developed forms for
documenting market research and quality assurance. In addition, it stressed
quality assurance surveillance in its contracting officer representative training
held in June 2014.

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