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AFMD-81-105 1 (1981-10-05)

handle is hein.gao/gaobabcni0001 and id is 1 raw text is: RELEASED U.STRICTIFD ~ b~jhahJ~10 -f N~ toh REPORT BY THE , .. Comptroller General OF THE UNITED STATES Defense Continues To Subsidize Sales Of Secondary Items To Foreign Governments Because Of Poor Pricing Policies Oer the years, the Congress has made it clear that D fense appropriations are not to be used to sub- si ize the foreign sales program. However, according t GAO estimates, over $8 million of Defense ap- p opriations were used to subsidize the foreign mil- itary sales program in fiscal 1979 at four inventory control points because of inadequacies in estimating ncplacement costs of secondary items sold from in- v ntory. GAO believes that additional millions of d liars in subsidies occurred because all foreign gvernments were not billed for certain indirect csts associated with these sales. AO is recommending actions, including legislative c anges, necessary to improve Defense's pricing pol- i ies and procedures for sales of secondary items. 116606 AFMD-81-105 OCTOBER 5, 1981

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