Defense Inventory:

DOD Needs to Continue Efforts to Improve Its Requirements Determination and Ordering Processes

T-NSIAD-92-16: Published: Mar 11, 1992. Publicly Released: Mar 11, 1992.

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GAO discussed: (1) inventory management issues at the Department of Defense (DOD); and (2) its conclusion that Congress needs to encourage DOD to stop buying items it does not need. GAO noted that: (1) it has identified defense inventory management as 1 of 16 areas of government activities that are highly vulnerable to mismanagement, fraud, and abuse; (2) problems with the requirements determination process include inventory requirements, inadequate consideration of an item's essentiality when inaccuracy in ordering spare parts, failure to cancel unnecessary or excess on-order material, and a lack of effective management controls; (3) wholesale level activities sometimes buy items that retail level activities have in excess stock; and (4) other long-standing inventory management problems include buying spare parts too early, excessive lead times resulting in excessive purchases, and failure to repair unserviceable assets instead of buying new items. GAO believes that: (1) DOD needs to establish goals for reducing the inventory it is storing and maintaining; and (2) Congress needs to maintain close oversight of DOD inventory management improvement efforts.

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