Contract Pricing:

Issues Related to DCAA Staff Levels

NSIAD-93-225: Published: Jul 1, 1993. Publicly Released: Aug 4, 1993.

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Pursuant to a congressional request, GAO provided information on the Defense Contract Audit Agency's (DCAA) staff reductions and their effect on DCAA ability to protect against fraud, waste, and mismanagement.

GAO found that: (1) between 1990 and 1993, DCAA has reduced its staffing levels from 7,030 work years to 5,650 work years; (2) the President's 1994 proposed funding level would increase DCAA staffing by 70 work years; (3) although the decline in Department of Defense contracts over $25,000 has reduced the need for some types of DCAA audits, DCAA needs sufficient staff to protect the government from contract overpricing; and (4) several areas of contract risk that DCAA needs to address include reviewing subcontractors' defective pricing, reviewing contractor overhead costs, reducing the audit backlog of contractor-incurred costs, and ensuring adequate levels of transaction testing to detect unallowable contractor cost submissions.

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