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GAO examined sole-source negotiated procurements for M1 tank spare components.
Recommendations for Executive Action
|Department of Defense||1. The Secretary of Defense should direct the Director, Defense Acquisition Regulatory Council, to strengthen Defense guidance on fixed-price incentive contracts by identifying circumstances which preclude combining ceiling prices under an existing contract with those established under modifications to those contracts, especially when the contract cost will exceed, or are expected to exceed, the target prices.|
|Department of Defense||2. The Secretary of Defense should direct the Secretary of the Army to instruct M1 contracting officers of the importance of complying with the requirement in the DAR to prepare and maintain adequate memorandum records of the negotiations which demonstrate that the negotiated prices were fair and reasonable.|