Defense Contracting: Terminating Major Weapons Contracts for the Government's Convenience
NSIAD-91-255
Published: Aug 30, 1991. Publicly Released: Aug 30, 1991.
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Highlights
Pursuant to a congressional request, GAO provided information on the Department of Defense's (DOD) procedures for terminating contracts for the convenience of the government.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | Although the Contract Fund Status Report provides some information on potential termination costs, the Secretary of Defense should modify it to provide DOD management more accurate information for decisionmaking. To obtain more reliable contract termination cost estimates, the Secretary of Defense should identify and adopt the necessary cost-effective improvements to the existing cost reporting system. As a minimum, consideration should be given to expanding the reporting coverage and identifying the types of termination cost information from contractors. |
DOD disagreed with the recommendation. For the vast majority of DOD contracts that proceed normally to completion, rough estimates are considered adequate. Further, it is DOD's position that no additional coverage is necessary for the report. In light of DOD's response, GAO plans no further action.
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Topics
Weapons systemsContract terminationContract termination costsDefense cost controlDefense procurementProcurement regulationsTermination costsMilitary forcesFederal regulationsWeapon systems