The paper that becomes a U.S. banknote starts, administratively, as a contract. In 2020 the Bureau of Engraving and Printing was working through a ten-year deal for that paper, and a routine audit of the winning bidder’s own numbers flagged problems the government’s inspectors did not fully resolve in the document they produced. The report surfaced publicly years afterward, and it stops well short of saying what those problems actually cost.
A Report Surfaces
On November 15, 2023, a document with the designation Audit Report No. 1901-2020A21000003 became visible to the public through The Black Vault, the Freedom of Information Act archive maintained by researcher John Greenewald. Its full title is “Independent Audit Report on Proposed Amounts in Crane & Co. Inc.’s Price Proposal dated February 19, 2020.” It was issued by the Department of the Treasury Office of Inspector General, the office that provides independent oversight of Treasury bureaus and their contracts. The report concerns a proposal Crane & Co. submitted on February 19, 2020, in response to a Bureau of Engraving and Printing solicitation for a ten-year currency and security-paper contract. The record states what the document is, who produced it, and the date it reached public view. It does not explain how it came to be released, or why that particular date.
Who Was Bidding, and For What
Crane & Co. operating as Crane Currency, is a subsidiary of Crane Co. and one of the principal suppliers of the paper used to print U.S. banknotes, alongside work it does supplying paper and security features to central banks elsewhere. The contract at stake was not a small one. Ten years of currency and security paper covers a large share of what the BEP needs to keep printing money. Crane’s February 2020 submission was a firm-fixed-price proposal, meaning the company agreed in advance to set prices for the life of the contract regardless of what its own costs turned out to be. Under the terms of the solicitation, responsibility for those figures, and for the internal controls meant to catch errors in them, sat with Crane’s own management. The auditors’ job was narrower: to check that work against federal rules, not to build the pricing themselves.
What the Inspector General Checked
The examination followed Generally Accepted Government Auditing Standards (GAGAS), the federal framework governing how such audits are planned and documented. Those standards required the auditors to obtain reasonable assurance, not certainty, that Crane’s proposed amounts complied with the pricing terms of the Federal Acquisition Regulation (FAR), the body of rules governing how federal agencies buy goods and services. The auditors assessed the proposal as it stood on August 19, 2020, about six months after Crane submitted it. The scope was procedural: whether the numbers followed the rules, not whether the price was a good deal for the government.
Compliant, With Exceptions
The auditors’ conclusion, as written, was that Crane’s proposed amounts complied in all material respects with the solicitation’s pricing terms as of August 19, 2020, except for the noncompliances described. Those fell into four named categories: costs undermined by errors in the proposal itself, costs for which Crane had not supplied supporting documentation, costs unrelated to the proposal, and costs built on estimating methods the auditors judged unreasonable. That is a qualified pass. The report does not call the proposal noncompliant, and it does not call it clean. Nothing in the available material indicates the finding was appealed, revised, or restated after it was issued.
The Five Missing Pieces
The report names the four categories of exception without naming what fell inside them. It gives no dollar figure or percentage for the questioned costs. It does not identify which line items or cost elements were affected. It is silent on whether Crane took any corrective action afterward. It does not state whether the ten-year contract was ultimately awarded on the pricing that had just been qualified. And it never records the date on which Treasury’s Inspector General was first asked to conduct the audit at all. Each of these is an absence in the document, not a claim about what the absence conceals.
After the Report
Treasury’s Inspector General has examined Crane & Co.’s currency-paper pricing repeatedly, before and after this proposal. Audit Report OIG-07-001, dated October 5, 2006, covered an earlier BEP solicitation. Audit Report OIG-11-026, dated November 15, 2010, covered a different one and listed questioned costs of $0. Audit Report OIG-13-041, dated June 18, 2013, covered another. A later examination, Report OIG-CA-25-058, found questioned costs of $49,146,917 on a separate paper solicitation. In the same window as the report discussed here, Treasury’s OIG also completed a related review, dated August 10, 2020, of Crane’s Cost Accounting Standards disclosure statement, the filing contractors use to describe how they allocate costs, addressed to the BEP’s contracting officer. Those documents exist in the public record with outcomes and dates attached to them. Audit Report No. 1901-2020A21000003 does not. There is no public record, in The Black Vault’s release or elsewhere in the available material, of a follow-up finding, a reference to Congress, a notice that the ten-year contract was awarded on this pricing, or a statement from Crane & Co. responding to the exceptions. The trail, as far as the documents show, ends with the audit itself.