Twenty-Seven Years' Experience with Defense Industrial Funds

FGMSD-76-51: Published: Oct 5, 1976. Publicly Released: Oct 5, 1976.

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An overview of 27 years of Department of Defense use of industrial funds indicates that some hoped-for objectives were achieved, but there are shortcomings. The funds were authorized by Congress to provide working capital for the operation of Defense industrial and commercial activities.

The funds have simplified financing, promoted the use of cost accounting, fostered efficiency, and provided managerial incentives. However, flexibility in manpower is not always available; financing arrangements have not enhanced productivity; and systems for measurement of costs and productivity are inadequate.

Matter for Congressional Consideration

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Matter: Guidelines for identifying and funding the cost of maintaining unused plants and equipment should be established, and cost controls should be periodically reviewed. Cost data should be included in reports to Congress.


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