GAO's Comments on the Defense Contract Profit Policy Act of 1988

GAO discussed the proposed Defense Contract Profit Policy Act of 1988. GAO noted that it supported the act, since it encompassed the major aspects of a GAO proposal for a Profitability Reporting Program, including requiring: (1) Department of Defense (DOD) contractors to report financial data regarding realized profits; and (2) DOD to analyze the results of these profits on government business. GAO also noted that the act's provisions would: (1) give DOD better and more timely assurance that its profit policies are producing the intended results; (2) protect individual contractors by dealing only with aggregate data; and (3) establish an advisory council to address data analysis methodology issues.