U.S. Department of Energy 

Office of Inspector General 

Office of Audit Services 

Audit Report 

The Department's Management of 

Nuclear Materials Provided to 

Domestic Licensees 

DOE/IG-0813 February 2009 
Department of Energy 

Washington, DC 20585 

February 18, 2009 

MEMORANDUM FOR THE SECRETARY 

, 2d<22;~;14d? 

FROM: Gregory H. Friedman 

Inspector General 

SUBJECT: 1NFORMATION: Audit Report on "The Department's 

Management of Nuclear Materials Provided to Domestic 

Licensees" 

BACKGROUND 

Since the 1 9501s, the Department of Energy and its predecessor agencies have provided 

nuclear materials, including various forms of uranium and plutonium, to academic 

institutions, conlmercial facilities and other government agencies. The Atomic Energy 

Act of 1954 provided authority for these materials to be loaned or leased for research, 

educational or medical purposes, or for other projects consistent with the Department's 

mission. As of the end of September 2007, 101 domestic facilities had Departmentowned nuclear materials in their possession. 

The Department and the Nuclear Regulatory Commission (NRC) share responsibility for 

nuclear material provided to domestic licensees, including accounting for the material 

and tracking its location. Both organizations use the Department of Energy managed 

Nuclear Materials Management and Safeguards System (NIVIMSS), the U.S. 

Government's official central nuclear materials accounting system, to assist them in 

carrying out their respective responsibilities. In October 2001, we reported that the 

Department could not fully account for nuclear materials loaned or leased to domestic 

licensees, at least partly due to inaccurate and/or incomplete NMMSS record keeping. 

We made several recommendations designed to ensure that the Department confirmed 

nuclear material balances, enhanced its control over these materials, and improved its 

coordination with the NRC. The Department concurred with our recommendations and 

pledged to take a number of actions designed to improve accountability. We initiated this 

follow-up audit to determine whether the Department was adequately managing its 

nuclear materials provided to domestic licensees. 

RESULTS OF AUDIT 

Our review disclosed that the Department could not always accurately account for, and, 

had not adequately managed, significant quantities of nuclear material that had been 

provided to domestic licensees. For about 37 percent (15 of 40) of the domestic facilities 

we reviewed. the Department could not accurately account for the quantities and 

locations of certain nuclear materials. In a number of cases, the Department had also 

agreed to write-off large quantities without fully understanding the ultimate disposition of 

these materials. In particular: 
Waste processiilg facilities we visited were unable to verify that 6,71 1 grams of 

special iluclear material and 35,269 kilograms of depleted and/or normal uranium, 

recorded in NMMSS as being in their custody, were either still under their control 

or had been treated and disposed of as waste; 

During 2004, a number of domestic licensees reported that their actual holdings of 

Ilepartment-owned nuclear materials were less than the quantities recorded in 

NNIMSS. Rased on that information, the Department agreed to write off over 

20,000 grams of special nuclear material and over 194,000 kilograms of depleted 

and/or normal uranium without investigating the whereabouts or actual 

disposition of the material; and, 

A 32 gram plutonium-beryllium source on loan to a college and subsequently 

transferred to another academic institution was not accounted for in NMMSS. 

Except for a few instances, the Department had also not regularly contacted domestic 

licensees to determine whether they had a continuing need for or wished to return nuclear 

materials in their possession. For example, three licensees with Department-owned 

nuclear materials told us that they no longer needed and wanted to return materials, but 

had not been contacted by the Department. Additionally, two of these licensees were 

confused about how to execute such a return. 

The Department's management of its nuclear materials held by domestic licensees was 

less than fully effective because of deficiencies in monitoring and control practices. We 

found that certain corrective actions had been taken in response to our October 2001 

report, such as the one-time confirmation of inventory balances in 2004. While these 

actions resulted in some programmatic improvements, a few key commitments made by 

the Department were not completed nearly eight years after our earlier audit. In 

particular, although the Department established requirements for periodic confirmations 

of these nuclear materials inventories after the 2004 exercise, additional confirmations 

had not actually occurred. Additionally, the Department's guidance to licensees on 

preparing and reporting inventory transactions was insufficient, leading to inventory 

recordkeeping concerns. These and other weaknesses affected the Department's ability to 

accurately account for its nuclear materials inventories that had been provided to others. 

We recognize the difficulty the Department faced during 2004 when attempting to 

reconcile balances and resolve accounting and tracking errors that accumulated over a 

number of years. These difficulties were, however, a direct result of long-standing 

material monitoring, control and tracking concerns. Without improvement, the 

Department cannot properly account for and effectively manage its nuclear materials 

maintained by domestic licensees and may be unable to detect lost or stolen material. 

Accordingly, we made several recommendations designed to improve the Department's 

management of nuclear inaterials provided to domestic licensees. 

MANAGEMENT REACTION 

Management generally agreed with the recoinmeildations in the report and agreed that the 

Department, through its prograin offices, needs to filrther enhance ils oversight and 
management of nuclear materials provided to domestic licensees. Management's planned 

corrective actions are generally responsive to our recommendations. Management's 

comments and our responses are summarized in the body of the report and are attached as 

Appendix 3. 

Attachment 

cc: Office of the Deputy Secretary 

Office of the Under Secretary 

Office of the Under Secretary for Science 

Administrator, National Nuclear Security Administration 

Chief of Staff 

Director, Policy and Internal Controls Management, NA-66 

Team Leader, Audit Liaison Team, CF- 1.2 
REPORT ON THE DEPARTMENT'S MANAGEMENT OF NUCLEAR 

MATERIALS PROVIDED TO DOMESTIC LICENSEES 

TABLE OF 

CONTENTS 

Management of Department-owned Nuclear Materials 

Iletails of Finding ............................................................................................................. 1 

I<ecommendations and Comments .................................................................................... 8 

Appendices 

1. Ob.jective, Scope, and Methodology ......................................................................... 1 1 

2. I'rior Report .............................................................................................................. 13 

3. Management Comments ............................................................................................ 14 
MANAGEMENT OF DEPARTMENT-OWNED NUCLEAR 

MATERIALS 

________________________________________________________________ 

Page 1 Details of Finding

Nuclear Material Department of Energy (Department) could not always 

Control and accurately account for and had not adequately managed 

Accountability significant quantities of nuclear material that had been 

provided to domestic licensees. For 15 of the 40 (about 37 

percent) non-Departmental domestic facilities we reviewed, 

the Department: (1) did not have an accurate accounting of 

its nuclear materials held by or removed from a licensee's 

site; or, (2) agreed to write off large quantities of nuclear 

materials from its tracking system without sufficient 

knowledge of the ultimate disposition of the materials. We 

also found that a few domestic licensees had nuclear 

materials on site but had no regular contact with 

Department officials and were unaware of procedures to 

return unneeded Department-owned materials. While the 

specific issues varied from facility to facility, each 

illustrates problems the Department has with control of its 

nuclear materials held by domestic licensees. 

Accountability over Department-owned Nuclear Materials

The Department had not maintained accountability over its 

nuclear materials at some domestic licensees. While the 

tracking system utilized by the Department, the Nuclear 

Materials Management and Safeguards System (NMMSS), 

showed quantities of nuclear materials in domestic 

licensees' inventories, some of these materials were no 

longer maintained by the licensee and/or their ultimate 

disposition was uncertain. Specifically, the waste 

processing facilities we visited were unable to verify that 

the 6,711 grams of special nuclear material or the 35,269 

kilograms of depleted and/or normal uranium (source 

material1

), currently being tracked in the NMMSS, were 

either still on site or had been treated and disposed of as 

waste. As an example, one facility's NMMSS inventory 

included 6,000 kilograms of depleted uranium that was 

transferred to the site nearly ten years ago. Licensee 

officials indicated that the material would not still be at 

their facility because they were in the business of 

processing waste. However, those same officials could not 

verify the ultimate disposition of the materials. Similarly, 

the Departmental program element with original 

responsibility for the material was also not aware of the 

actual disposition, nor did the program know why the 

material was transferred to the licensee in the first place. In 

 

1

 Includes depleted uranium, normal uranium, thorium, or any other nuclear material determined to be 

source material. 
 

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Page 2 Details of Finding

another instance, a manufacturing company we visited 

acknowledged possessing only a small portion (13 

kilograms) of the 533 kilograms of Department-owned 

depleted uranium reported in its NMMSS balance. The 

company indicated that the rest of the depleted uranium in 

its custody was privately-owned and was being treated as 

such for reporting requirements. 

Materials Written Off From NMMSS Inventories

The Department also agreed to write off large quantities of 

nuclear materials at domestic licensees without confirming 

the disposition of those materials. In response to our 

October 2001 report, the Nuclear Regulatory Commission 

(NRC), in coordination with the Department, undertook a 

one-time comprehensive confirmation of NMMSS 

inventory balances in 2004. This effort was used to 

rebaseline all of the NMMSS information related to the 

Department's nuclear materials at domestic licensees. To 

rebaseline the inventory levels in the NMMSS, the 

Department agreed to write off significant amounts of 

nuclear materials based on the licensees' reported nuclear 

materials on-hand. The Departmental elements with 

original programmatic responsibility for the materials that 

had accumulated at the licensees over many years were not 

contacted for additional explanations, justifications, or 

approvals before the changes were made. 

During this effort, the Department agreed to write off the 

following quantities of its nuclear materials from the 

NMMSS inventories of just the 40 facilities we reviewed: 

• 20,580 grams of enriched uranium; 

• 45 grams of plutonium; 

• 5,001 kilograms of normal uranium; and, 

• 189,139 kilograms of depleted uranium. 

Considering the potential health risks associated with these 

materials and the potential for misuse should they fall into 

the wrong hands, the quantities written-off were significant. 

For example, even in small quantities normally held by 

individual domestic licensees, special nuclear materials 

such as enriched uranium and plutonium, if not properly 

handled, potentially pose serious health hazards. Normal 

and depleted uranium are also hazardous in that they are 

chemically toxic heavy metals that, if inhaled or ingested in 

high doses, can have adverse health effects. 
 

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Page 3 Details of Finding

During physical verification of inventory, we also 

discovered that an academic institution (College A) held a 

Department-owned 32 gram plutonium-beryllium source 

that was not being tracked in NMMSS. This source had 

been transferred to College A from a different institution 

(College B) in 1986 without the appropriate transaction 

reported to the NMMSS. Despite the actual physical 

transfer, this source remained in College B's NMMSS 

inventory until 2004. A College B official was questioned 

about this source in 2001, and a NMMSS official 

confirmed with College B that, in 1986, the source had 

been transferred to College A. Based on the information 

provided by College B, a miscellaneous shipment 

transaction was prepared by the Department's NMMSS 

contractor to write off the source from College B's 

inventory balance. However, due to a reporting error in 

this transaction, the source was not actually written off 

College B's NMMSS inventory until 2004. More 

importantly, no transaction was made to record the receipt 

of the source at College A. We physically verified that the 

unaccounted for plutonium-beryllium source existed in a 

storage area at College A during our site visit. This 

Department-owned source had been at College A for over 

20 years without any Departmental monitoring or control. 

According to the Office of Health, Safety and Security 

(HSS), plutonium-beryllium neutron sources can have high 

neutron dose rates, and if one of these sources was removed 

from its shielding and placed in close proximity to 

individuals for an extended period of time, there could be 

adverse health effects. 

Excess Nuclear Materials at Domestic Licensees

We also identified several domestic licensees that had 

custody of loaned nuclear materials but had no regular 

contact with Department officials and were unaware of 

procedures to return materials they no longer needed. 

According to the original loan agreements, the material 

remains the property of the Department and must be 

returned once the agreement is terminated. The facility is 

responsible for costs associated with the return of the 

materials. The materials these licensees wished to return to 

the Department, which in one case has been in storage at a 

facility and never used for over 30 years, included 

quantities of enriched and depleted uranium. These 

facilities had not been contacted by the Department for 
 

________________________________________________________________ 

Page 4 Details of Finding

periodic confirmation of balances or inquiries as to whether 

they still had a need for the materials in their custody. As 

such, current licensees told us that they were confused 

about their return options. The names of these facilities 

have been provided to the Department so that they can 

decide which organization needs to coordinate the return or 

disposition of these materials. 

Monitoring and Management of the Department's nuclear materials at 

Control domestic licensees had not been fully effective because of 

deficiencies in its monitoring and control. Corrective 

actions taken in response to our October 2001 report 

resulted in some improvements. For example, a process 

was established to manually identify and address negative 

balances on a monthly basis. Action was also taken to 

improve coordination between the Department and the 

NRC, which included a one-time effort in 2004 to confirm 

the NMMSS inventory data. A few key steps, however, 

were never implemented. 

Specifically, the Department had not performed or 

scheduled periodic confirmations of its nuclear materials 

held by domestic licensees as we recommended in our 2001 

report. These confirmations have not been performed even 

though the Department formally made them a requirement 

in August 2006. Without periodic updates, inventory 

information can become outdated due to the changing 

nature of these nuclear materials inventories. While a onetime, comprehensive confirmation of the NMMSS 

inventory data was performed in late 2004, it did not 

identify the differences that existed prior to this 

confirmation, which we noted during 2 of our 13 site visits. 

On the date we performed our site review, these differences 

had not been resolved. Notably, the unreported plutoniumberyllium source identified at an academic institution was 

still not being tracked in NMMSS as of July 2008. We also 

found additional differences at other sites that we visited. 

However, with one exception, we could not specifically 

determine whether they originated before or after the 2004 

confirmation. 

We also found that inconsistencies existed in the NMMSS 

information because the Department's guidance to licensees 

on preparing and reporting inventory transactions was 

insufficient. A number of licensee officials at facilities we 

reviewed stated that they needed such guidance because of 

the complexity of the process. One such circumstance that 
 

________________________________________________________________ 

Page 5 Details of Finding

exemplifies this issue is the reporting of nuclear materials 

at waste processing facilities. In most cases, transactions 

from the Department were reported to the NMMSS to send 

the nuclear materials to these facilities, but transactions to 

record their ultimate disposition have not been consistently 

reported. Additionally, in the case of the manufacturing 

company previously mentioned, further guidance is 

necessary to clarify whether the depleted uranium in its 

possession should be treated as Department-owned, as 

reported in the NMMSS, or privately-owned, as it is 

currently considered by the company. 

Sites also need to be made aware of the Department's 

reporting requirements, which differ from NRC 

requirements for some of the Department-owned nuclear 

materials held by licensees. For example, the Department 

requires all of its reportable depleted uranium to be tracked 

in the NMMSS through the regular transaction reporting 

process whereas NRC does not. The inconsistent 

application of NMMSS transaction reporting has caused 

large quantities of nuclear materials to accumulate in 

NMMSS inventories, when it is possible that the materials 

have been disposed of, transferred to another company, or 

even returned to the Department. Additionally, many of 

the licensees with smaller inventories of nuclear materials 

had not updated the NMMSS for several years or even 

decades, because the materials they possessed did not meet 

NRC's minimum reporting thresholds. Without accurate 

transaction recording, the Department will not be able to 

properly track these nuclear materials inventories. While it 

is possible that changes in NRC reporting requirements that 

took effect in January 2009 could reduce some of the 

inconsistencies, the effect of these changes are not yet 

determinable. 

 

Additionally, while the 2004 confirmation appeared to 

eliminate most of the questionable data in the NMMSS, 

there were quantities of nuclear materials that were 

removed from NMMSS inventories without justification 

and approval by the responsible program element. This 

occurred because, according to Departmental officials 

responsible for tracking the material, programmatic 

responsibility for many of the nuclear materials was not 

maintained over the years due to numerous programmatic 

reorganizations and changes in the program/project 

identifiers in the Department's accounting system. 

However, as noted in Departmental regulations, 
 

________________________________________________________________ 

Page 6 Details of Finding

responsibility for verifying NMMSS inventory balances is 

vested in either the Departmental program office 

responsible for the materials or the Departmental element 

responsible for NMMSS when no programmatic owner has 

been assigned. Thus, although the element responsible for 

NMMSS should have taken steps to justify the write off of 

material, program offices were not contacted to provide 

justifications for the changes or explanations of the 

differences. Therefore, it is not possible to determine what 

the differences represented or what ultimately became of 

the materials. Much of the materials that were written off 

were those that had been provided to the previously 

discussed waste processing facilities for disposal. In 

responding to our draft report, HSS asserted that materials 

at disposal facilities were appropriately dispositioned 

within NMMSS during the 2004 confirmation. However, 

while we agree that the transaction entries effectively 

eliminated the materials from NMMSS inventories, we 

disagree that they should have been eliminated without 

explanations of the differences and Department knowledge 

of the ultimate disposition of the materials. 

We recognize the difficulty the Department faced during 

2004 when attempting to reconcile balances and resolve 

accounting and tracking errors that may have accumulated 

over a number of years. Indeed, HSS officials told us that 

they believed the NMMSS accounting inaccuracies were 

most likely the result of the non-Department facilities' 

issues with changes in the reporting requirements, lost or 

inaccessible records, inaccurate reporting or reporting 

omissions. These difficulties were, however, exacerbated 

by long-standing issues with monitoring, control and 

tracking of materials. HSS officials indicated, in their 

comments to the draft report, that one way to address these 

issues would be to add language in future Departmental 

contracts to spell out inventory and transaction reporting 

requirements for government-owned nuclear materials, 

since the Department had no authority to conduct on-site 

confirmations of physical inventories. Adding this 

language to future contracts should help the Department 

monitor their materials at facilities that enter into future 

agreements with the Department. However, as the owner 

of the nuclear materials in question, the Department is 

responsible for their control, accountability, and final 

disposition, and under regulation, is required to annually 
 

________________________________________________________________ 

Page 7 Details of Finding

obtain written verifications from existing licensees that 

they continue to possess the materials and that the NMMSS 

records are correct. 

Finally, we noted during most of our reviews of academic 

institutions and other non-Departmental facilities that the 

Department had not contacted them at regular intervals to 

inquire as to the status of these materials or whether they 

were still needed and/or wanted. While some Departmental 

elements made an effort to contact domestic licensees, 

officials from several of the licensees we reviewed 

indicated that, with the exception of the 2004 NMMSS 

confirmation, they were not regularly contacted to verify 

the status of the nuclear materials. In responding to our 

draft report, HSS questioned why some of the excess 

materials discussed earlier in this report were not brought 

to their attention by the sites during the 2004 NMMSS 

confirmation, but agreed that regardless of this, the 

Department needed to continue to improve in this area. 

Control over Without adequate control and accountability, the Department 

Nuclear Material cannot effectively manage its nuclear materials at domestic 

licensees. The Department's nuclear material 

accountability programs must ensure that nuclear materials 

are accounted for and that unauthorized acts are detected. 

Insufficient accountability over nuclear material inventories 

results in a reduced ability to detect lost or stolen material 

and may adversely affect the Department's ability to 

manage the disposal of these nuclear materials. Due to the 

inconsistencies documented in our report, it would be 

extremely difficult, if not impossible, for the Department to 

accurately identify the type and quantity of its nuclear 

materials affected if an incident occurred at one of the sites 

whose NMMSS inventory we could not verify. Because of 

the potential health risks and negative public perception 

associated with nuclear materials management, the 

Department should give this area increased priority. 

In addition to the security aspects of this issue, these 

inventories are essentially a liability that the Department 

must eventually address. Unreliable records limit the 

Department's ability to ensure that materials held by nonDepartmental sites are ultimately disposed of or reused 

safely and effectively. At some point in the future, this 

material should be returned to the Department and either 

disposed of as waste or, if possible, reutilized in support of 

Departmental missions. Unless the associated NMMSS 
 

________________________________________________________________ 

Page 8 Recommendations and Comments 

records are complete and accurate as to material quantities 

and locations, the complexity and cost of the Department's 

disposal or reutilization tasks could be difficult to estimate. 

RECOMMENDATIONS To address the nuclear material accountability issues 

discussed in our report, we recommend that the Chief 

Health, Safety and Security Officer, in coordination with 

the responsible Department program officials: 

1. Conduct a confirmation of balances of Departmentowned nuclear materials held by domestic licensees 

and establish a schedule for future periodic 

confirmations. The resulting information should be 

reconciled with NMMSS data and necessary 

correcting entries made, in conjunction with the 

justification and approval of either the responsible 

Departmental program office or the Departmental 

element responsible for NMMSS. 

2. Develop and implement enhanced procedures for 

the accounting of Department-owned nuclear 

materials. Including, but not limited to, establishing 

processes to: 

a. periodically confirm the continuing need for 

Department-owned nuclear material at 

domestic licensees; and, 

b. incorporate this information into 

Departmental material disposition and 

reutilization plans. 

3. Clarify, as necessary, inventory transaction 

recording and reporting requirements and enhance 

the effectiveness and participation of the training 

offered to domestic licensees. Potential actions 

include, but are not limited to, developing and 

implementing additional guidance, and establishing 

web-based training opportunities. 

MANAGEMENT The Office of Health, Safety and Security (HSS) indicated 

REACTION that it generally agreed with our recommendations for 

increased oversight and management of nuclear materials 

provided to domestic licensees and additional coordination 

efforts with the responsible program offices and field 

entities. HSS noted that, shortly after we initiated our 

audit, the Office of Security Evaluations began using 
 

________________________________________________________________ 

Page 9 Comments 

Nuclear Materials Management and Safeguards System 

(NMMSS) generated information to routinely question the 

Departmental Material Control and Accountability program 

officials about the government-owned materials transferred 

from their facilities to domestic licensee facilities. HSS's 

intent was to ensure that the facilities and programs at the 

facilities take ownership and management responsibilities 

for licensees' continued use and disposition planning of 

these materials. 

With respect to our specific recommendations, HSS 

believed that ongoing and planned activities including the 

new January 2009 NRC reporting requirements would 

satisfy recommendations 1 and 2a. HSS also recognized 

the need for additional coordination efforts with the 

responsible Headquarters program offices and field entities 

to ensure the implementation of recommendation 2b. 

HSS's response to an earlier version of recommendation 3 

indicated that the recommendation should focus on 

ensuring licensee facilities with government-owned 

materials are made aware of available training and support 

for implementation of the existing guidance rather than 

developing and issuing additional guidance. 

Management's verbatim comments are included in 

Appendix 3. 

AUDITOR Management concurred with our recommendations and 

COMMENTS recognized that improvements and continued vigilance are 

needed to enhance the oversight and management of 

nuclear materials provided to domestic licensees. 

Management's comments are considered generally 

responsive to the recommendations. The recent efforts by 

the Office of Security Evaluations were not confirmed 

during our review and do not appear to have been added to 

its Material Control and Accountability Inspector's Guide, 

but should lead to increased communications related to the 

materials at non-Departmental sites. 

Regarding our specific recommendations, management 

asserted that ongoing and planned activities, including 

changes to the NRC reporting requirements, will satisfy 

recommendations 1 and 2a. These new reporting 

requirements should provide the Department with better 

information on the nuclear material inventory balances at 

domestic licensees. The Department will need, however, to 

evaluate the new NRC reporting requirements and 
 

________________________________________________________________ 

Page 10 Comments 

supplement them as necessary to ensure that there is 

sufficient information available to explain any inventory 

differences and determine the ultimate disposition of 

nuclear materials transferred from licensee facilities. 

We also revised our third recommendation because we 

continue to believe that the current guidance is confusing 

and that the Department should review the existing 

guidance and consider changes to clarify the requirements. 

The existing training opportunities and offers of support 

have been available to NMMSS users, but those items 

alone have not been effective. We agree that ensuring all 

licensees are aware of the training and support 

opportunities that are made available to them is a positive 

step. We also feel, however, that the establishment of 

supplemental guidance and web-based training programs, 

to be available as needed, could increase the effectiveness 

and participation rate in NMMSS training among the 

licensees. 

HSS also provided a more detailed management analysis 

and response to the draft report in an attachment to its 

official comments and these have been reviewed and 

incorporated into the final report as appropriate. 
Appendix 1 

___________________________________________________________________ 

Page 11 Objective, Scope, and Methodology 

OBJECTIVE To determine whether the Department of Energy (Department) 

was adequately managing its nuclear materials provided to 

domestic licenesees. 

SCOPE The audit was performed from February 2007 to September 

2008 at Department Headquarters in Washington, DC, and 

Germantown, MD; the Oak Ridge Office and the Oak Ridge 

National Laboratory in Oak Ridge, TN. In addition, we visited 

or obtained data from 40 different non-Departmental facilities 

in various states. 

 

METHODOLOGY To accomplish the audit objective, we: 

• Reviewed Departmental and Nuclear Regulatory 

Commission (NRC) requirements for the control and 

accountability of nuclear materials; 

• Analyzed a Nuclear Materials Management and 

Safeguards System (NMMSS) report with ending 

inventory balances for Department-owned nuclear 

materials dated September 30, 2007, to determine the 

amount and types of nuclear materials located at nonDepartment domestic facilities; 

• Held discussions with Department and NRC personnel 

that used NMMSS information to determine their roles 

and responsibilities related to the control and 

accountability over nuclear materials; 

• Selected a judgmental sample of 40 non-Department 

domestic facilities; 

• Met with licensee officials and sent confirmations to 

determine whether their actual inventories of 

Department-owned nuclear materials were consistent 

with inventories reported in the NMMSS; and, 

• Analyzed historical information related to the 2004 

NMMSS inventory rebaselining initiative to determine 

the quantity of Department-owned nuclear materials 

that were written off from the domestic licensees' 

inventory balances. 

This performance audit was conducted in accordance with 

generally accepted Government auditing standards. Those 
Appendix 1 (continued) 

___________________________________________________________________ 

Page 12 Objective, Scope, and Methodology 

standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis 

for our findings and conclusions based on our audit objective. 

We believe that the evidence obtained provides a reasonable 

basis for our findings and conclusions based on our audit 

objectives. The audit included tests of controls and compliance 

with laws and regulations related to managing the Departmentowned nuclear materials provided to non-Departmental 

domestic licensees. Because our review was limited it would 

not necessarily have disclosed all internal control deficiencies 

that may have existed at the time of our audit. We examined 

the establishment of performance measures in accordance with 

Government Performance and Results Act of 1993, as they 

related to the audit objective. We found that the Department 

had established performance measures related to removing or 

disposing of nuclear materials and radiological sources around 

the world. We utilized computer generated data during our 

audit and performed procedures to validate the reliability of the 

information as necessary to satisfy our audit objective. As 

noted in the report, we questioned the reliability of the 

NMMSS data. 

Management waived an exit conference. 
Appendix 2 

___________________________________________________________________ 

Page 13 Prior Report 

PRIOR REPORT

Office of Inspector General Report 

• Accounting for Government-Owned Nuclear Materials Provided to NonDepartment Domestic Facilities (DOE/IG-0529, October 2001). This audit 

found that the Department of Energy could not fully account for nuclear 

materials loaned or leased to domestic licensees. The audit identified 

substantial amounts of nuclear materials that were reported to be at two licensed 

facilities that no longer existed, several licensee facilities that carried balances 

that were not logical and that could not be adequately explained or reconciled, 

and records that were incomplete in that they did not contain information on all 

Government-owned nuclear materials provided to licensees. 

. 
Appendix 3 

___________________________________________________________________ 

Page 14 Management Comments 
Appendix 3 (continued) 

___________________________________________________________________ 

Page 15 Management Comments 
Appendix 3 (continued) 

___________________________________________________________________ 

Page 16 Management Comments 
Appendix 3 (continued) 

___________________________________________________________________ 

Page 17 Management Comments 
IG Report No. DOE/IG-0813__

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