Inadequate Controls over DOD Subcontracts Cost Government Millions of Dollars

T-NSIAD-91-37: Published: May 22, 1991. Publicly Released: May 22, 1991.

Additional Materials:

Contact:

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

GAO discussed Department of Defense (DOD) subcontracts, focusing on DOD vulnerability to inflated subcontract prices. GAO noted that: (1) subcontract costs often comprised more than 50 percent of prime contract costs; (2) subcontractor overpricing was frequent and pervasive; (3) DOD did not have direct management control over subcontracts because its contractual relationship was with the prime contractors, not the subcontractors; (4) subcontractors frequently did not disclose accurate, complete, or current cost pricing data; (5) administrative contracting officers had the authority to take whatever action necessary to ensure that contractors correct unacceptable systems; (6) regulations required contractors to evaluate noncompetitive subcontracts and include results of evaluations as part of their contract proposals; (7) prime contractors used one set of competitive subcontract prices to support their bids, but subsequently solicited and obtained significantly lower prices for negotiating their subcontracts; and (8) defense subcontract pricing was highly vulnerable to fraud, waste, and abuse.

Oct 11, 2018

Oct 10, 2018

Oct 9, 2018

Sep 24, 2018

Sep 20, 2018

Sep 10, 2018

Sep 6, 2018

Sep 5, 2018

Sep 4, 2018

Looking for more? Browse all our products here