B-118663, APR. 30, 1958

B-118663, APR. 30, 1958

TO THE SECRETARY OF THE NAVY:

ENCLOSED IS OUR REPORT ON EXAMINATION OF SELECTED ACTIVITIES OF AMERICAN BOSCH ARMA CORPORATION, ARMA DIVISION, GARDEN CITY, NEW YORK, UNDER VARIOUS DEPARTMENT OF THE NAVY NEGOTIATED CONTRACTS.

THE REPORT PRESENTS OUR FINDINGS PERTAINING TO (1) OVERSTATEMENT OF COSTS IN A PRICE-REDETERMINATION PROPOSAL, RESULTING IN NEGOTIATION OF AN EXCESSIVE CONTRACT PRICE, (2) LATE SUBMISSION OF PRICE REDETERMINATION PROPOSALS, AND (3) INADEQUATE CONTROL OF GOVERNMENT PROPERTY. THE REPORT ALSO INCLUDES COMMENTS FURNISHED BY THE DEPUTY COMPTROLLER OF THE NAVY AND THE CONTRACTOR. THESE COMMENTS SHOW THAT ACTION HAS BEEN TAKEN TO CORRECT THESE DEFICIENCIES.

WE UNDERSTAND THAT THE CONTRACTOR HAS OFFERED A REFUND TO THE NAVY IN RECOGNITION OF THE EXCESSIVE PRICE WHICH RESULTED FROM OVERSTATEMENT OF HIS PRICE-REDETERMINATION PROPOSAL. WE SHALL APPRECIATE BEING ADVISED OF ACTION TAKEN BY THE NAVY WITH REGARD TO THE CONTRACTOR'S PROPOSED REFUND.