Contract Pricing:

Material Prices Overstated on GBU-15 Bomb Weapon System

NSIAD-89-125: Published: Apr 27, 1989. Publicly Released: Apr 27, 1989.

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GAO reviewed materiel prices under an Air Force firm-fixed-price contract for module sets for the GBU-15 Modular Guided Weapon System to determine whether the contractor complied with a statutory provision requiring it to provide accurate, complete, and current pricing data for the required materiel.

GAO found that the contractor: (1) did not disclose accurate, complete, and current cost or pricing data for 13 materiel items, resulting in estimated contract overpricing of $5,580,724; (2) stated that it inadvertently failed to disclose information regarding lower available price quotations, price negotiation position, and long-term purchase agreement; and (3) contended that the Air Force did not rely on its cost or pricing data during contract negotiations. GAO believes that the Air Force should initiate action to recover the overstated materiel prices from the contractor.

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