DOE Management:

DOE Needs to Improve Its Analysis of Carryover Balances

RCED-96-57: Published: Apr 12, 1996. Publicly Released: Apr 12, 1996.

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GAO reviewed the Department of Energy's (DOE) approach for identifying carryover balances from previous years' budgets that may be available to reduce budget requests for new fiscal years.

GAO found that: (1) DOE does not use a uniform, effective method of identifying carryover balances; (2) DOE makes separate, general estimates of excess funds in its individual programs; (3) some DOE programs have reduced their carryover balance while others have allowed their carryover balances to increase; (4) the DOE annual report on uncosted obligations is not used to identify potential carryover balances because it does not identify all of the carryover balances, identify all of the uncosted obligations that are available to reduce DOE budget request, or include enough information to be useful during the formulation of DOE budget; (5) within DOE, the Office of Waste Management has studied the operations of DOE programs and developed standard expectations for their levels of uncosted obligations; (6) the Office of Waste Management has determined that balances in excess of one month's worth of operating activities funding may indicate carryover balances and should be investigated; (7) within DOE, the Office of the Chief Financial Officer has suggested estimating the uncosted obligations at the start of each fiscal year using estimates of yearly costs or past costs; and (8) the various plans developed in DOE have not been implemented departmentwide and would need to be altered to fit individual programs.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: In response to the GAO recommendation, DOE issued a policy on uncosted balances on November 8, 1996. The policy established thresholds for balances to highlight those areas where balances appear high and require greater scrutiny. The policy also formally defines procedures and analytical criteria by which DOE can evaluate balances to determine if any portion of the balances are available. This policy was used to analyze uncosted balances as part of DOE's preparation of its fiscal year 1998 budget request.

    Recommendation: The Secretary of Energy should develop a more effective approach for identifying the carryover balances that exceed the requirements of DOE programs and are thus available to reduce the annual budget request.

    Agency Affected: Department of Energy


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