Millions in Losses Continue on Defense Stock Fund Sales to Foreign Customers

摘要

The Department of Defense continues to sell items to foreign customers from its stock fund inventory for less than estimated replacement cost. As a result, Defense appropriations are subsidizing foreign sales by millions of dollars each year--a practice the Congress wants Defense to avoid. This report discusses pricing problems similar to those reported by GAO in 1978. In establishing sales prices, Defense does not: (1) adequately consider the impact of inflation in determining replacement costs; and (2) update often enough the sales prices charged foreign customers. GAO is recommending actions necessary to improve Defense's pricing policies and procedures for stock fund items sold from inventory. (Author)