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Federal Bureau of Prisons Management of Construction Contracts

Report No. 02-32
August 2002
Office of the Inspector General


APPENDIX II

STATEMENT ON MANAGEMENT CONTROL STRUCTURE

In planning and performing our audit of the BOPís management of construction contracts, we considered the management control structure for the purpose of determining our audit procedures.† This evaluation was not made for the purpose of providing assurance on the BOPís overall management control structure.†However, we noted certain matters involving the management control structure and management of the BOPís construction contracts that we consider to be reportable conditions under generally accepted government auditing standards.

Reportable conditions involve matters coming to our attention relating to significant deficiencies in the design and operation of the management control structure that, in our judgment, could adversely affect the BOPís ability to manage new prison construction contracts.† We identified the following deficiencies: (1) the BOP did not always document the necessity for a contract modification, and (2) the BOP did not always justify why it negotiated modifications for a higher amount than the Independent Government Estimate.