Army Inventory:

More Effective Review of Proposed Inventory Buys Could Reduce Unneeded Procurement

NSIAD-94-130: Published: Jun 2, 1994. Publicly Released: Jun 2, 1994.

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GAO reviewed the Army Tank-Automotive Command's (TACOM) termination of planned procurements, focusing on whether TACOM terminated the procurements as early in the procurement process as possible.

GAO found that: (1) TACOM is missing opportunities to terminate or reduce planned procurements because item managers and procurement specialists do not always confer before awarding contracts; (2) item managers often arbitrarily change requirements data to bring their requirements and inventory into balance and rely on invalid, out-of-date, or unverified data; and (3) TACOM procurements could be reduced by as much as $21.5 million annually if recommended commitment cutbacks are made when they first appear.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Army Materiel Command issued 2 policy letters dated September 30, 1994, and November 23, 1994, providing guidance as recommended.

    Recommendation: To help TACOM ensure that commitments are being reduced appropriately, the Commander, Army Materiel Command, should issue policy guidance and instructions that require, before awarding a contract, procurement personnel check with item management personnel to ensure that the current requirements and inventory data are correct and that factors have not changed that would obviate the need for the contract.

    Agency Affected: Department of Defense: Department of the Army: U.S. Army Materiel Command

  2. Status: Closed - Implemented

    Comments: The Army Materiel Command issued revised requirements on February 29, 1994, that required item managers to document all actions taken in response to a recommended cutback of a proposed procurement. In addition, review levels were established for all actions taken on recommended cutbacks.

    Recommendation: To help TACOM ensure that commitments are being reduced appropriately, the Commander, Army Materiel Command, should issue policy guidance and instructions that require inventory management officials to ensure that their item managers do not arbitrarily change the requirements data to bring the requirements and inventory positions into balance and thereby avoid having to terminate or reduce a proposed procurement.

    Agency Affected: Department of Defense: Department of the Army: U.S. Army Materiel Command

 

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