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B-132923 1 (1973-08-01)

handle is hein.gao/gaobaafxs0001 and id is 1 raw text is: J I- I - .. . UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 PROCUREMENT AND SYSTEMS ACQUISITION DIVISION 4I IIIII 11111 I III I III LM096114 B-132923 AUG 0 1 1973 The Honorable The Secretary of Defense Attention: Assistant Secretary of Defense (Comptroller) Dear Mr. Secretary: We examined selected types of material costs charged by Bell Helicopter Company, Fort Worth, Texas, toGovernment contracts. Bell, a division of Textron, Inc., manufactures military and commercial helicopters and vertical-lift air- craft. At the time of our review, Bell held open Government contracts totaling $1.8 billion. Of this amount, about $1.5 billiolt, or about 87 percent, were fixed-price incentive contracts negotiated on a noncompetitive base. About 70 per- cent of this amount, or $1 billion, was for fully delivered contracts administered as open contracts because final price negotiations had not been conducted. The Army's Aviation Systems Command (AVSCOM), St. Louis, Missouri, administers these contracts through its resident personnel at the Bell plant. A resident staff of the Defense Contract Audit Agency (DCAA) is also located at the Bell plant. The allowability of millions of dollars of costs charged to Government contracts could not be determined, because Bell' s _,t s ~e~~e notp - pid q~ua~t& -ount-ab1-ityforoparts used in producing helicopters. Under this system the Government is not as- sured that its contracts are correctly charged. Further, the lack of accountability has delayed final price negotia- tion of incentive contracts. I' or

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