GAO Cites Army's Sloppy Record
Keeping
Yahoo News/AP
By ELISABETH GOODRIDGE, Associated Press Writer
December 29, 2005
WASHINGTON - Due to sloppy record-keeping, the Army cannot confirm that $68
million worth of shipped parts and tools ever made it into the hands of repair
contractors, congressional auditors say.
The Government Accountability Office, the auditing arm of Congress, released
a report Wednesday showing that the Army in 2004 failed to consistently record
shipment receipts to such contractors. That is one of many issues, the GAO
says, that leads to weak inventory oversight.
The report noted that Defense Department policy requires each service to
confirm the receipt of all assets shipped to contractors. But, the report said,
"the Army is not consistently recording shipment receipts in its inventory
management systems."
The Army is the third military branch to be admonished for faulty oversight.
In earlier audits, the GAO found a similar oversight problems with the Navy's
and Air Force's parts and tool shipments.
Each year, the Army ships thousands of items, from small tools to turbine
engines, to private contractors for repair, alterations or modifications.
Looking at data from two inventory control points, GAO investigators
estimated that 15 percent — or $68 million — of the unclassified
shipments they analyzed "could not be confirmed as being received."
Additionally, the GAO said receipt records for $481.7 million in
unclassified items shipped for repair — about 42 percent — could
not be reconciled with shipping records. Discrepancies also were found in
records for 37 percent, or about $8.1 million shipments, of classified parts
and tools.
"These data show that the Army, on the basis of records receipts maintained
in its inventory management systems, cannot confirm that a substantial portion
of its inventory items shipped to repair contracts were in fact received," the
audit said.
The GAO said the head of the Army's Materiel Command should look at
providing contractors advance notice of shipments, require quarterly status
reports and better document contractors' receipt of shipments.
Jack Bell, the deputy under secretary of defense for logistics and materiel
readiness, said in a Nov. 29 letter in response to a draft of the report that
he would agree to put in place the GAO's recommendations.
Michelle McCaskill, a spokeswoman for the Army Materiel Command, said
Wednesday the command "will ensure there are consistent, systematic procedures
in place to obtain and document contractors' receipt of repair items and follow
up promptly on unconfirmed receipts."
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