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PLRD-82-57 1 (1982-03-19)

handle is hein.gao/gaobabdbi0001 and id is 1 raw text is: 

                      UNITED STATES GENERAL ACCOUNTING OFFICE
                             WASHINGTON, D.C. 205A8


POCUIKMEKNT. LOGIITIC,
AM RgDAINL5 DIVISION
            PESTRICTED - Fot t be reloemed outside the  '
            iAccount~eg Office except on tli be s of specific  .
            Vtile Office of
 B-203876                               RELEASED    MARCH 19,1982

 The Honorable Barry M. Goldwater, Jr.
 House of Representatives
 Dear Mr. Goldwater:                                       117955

      Subject: Allegations of Insufficient Reimbursement Under
                the Value Engineering Program (PLRD-82-57)


      In your June 23, 1981, letter, you asked us to investigate
 whether K.I.M. and Associates, Westlake Village, California, is
 entitled to a monetary award under the Value Engineering Program.
 K.I.M. developed a modification kit that increases the life of the
 pressure vacuum pump used in certain Navy ground support equipment.
 K.I.M. submitted this pump improvement idea in a Value Engineering
 Change Proposal (VECP) to PRD Electronics, Syosset, New York, a
 Division of Harris Corporation, the prime contractor with the Navy
 for this equipment.

      A K.I.M. official alleged that PRD Electronics changed K.I.M.'s
 VECP to an Engineering Change Proposal (ECP) that resulted in PRD
 receiving over $500,000. He also alleged that K.I.M. did not
 receive any money.

      Our review disclosed that:

      --K.I.M. is not entitled to a monetary award under the Value
        Engineering Program since at the time it had no contract
        with either PRD Electronics or the Government, a requirement
        of the Defense Acquisition Regulation for participation in
        the Program.

      --PRD Electronics changed K.I.M.'s VECP to an ECP and was
        authorized to receive $246,402 from the Navy for 150 K.I.M.
        modification kits and other related work.
      --K.I.M. received $135,169 of the amount.paid PRD Electronics
        under the ECP for the modification kits.

 SCOPE OF REVIEW

      In responding to your request, we interviewed PRD officials
 and examined their documents on the value engineering issue,
 obtained further explanations and documentation from a K.I.M.

                                                            (942055)
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