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NSIAD-84-7 1 (1984-04-12)

handle is hein.gao/gaobabemh0001 and id is 1 raw text is: 





BY THE US GENERAL ACCOUNTING OFFICE


Report To The Secretary Of Defense












Excess Navy Ships Sold To Foreign

Countries At Understated Prices




Each of the 11 ships sold toforeign countries in fiscal years
1981 and 1982 was underpriced according to the Navy's
guidance. The ships were sold for a total of $5 2 million,
whereas prices should have totaled $36 4 million

The prices were generally based on scrap value rather than
the higher fair value This value could be even greater, but
the condition of the ships was not adequately determined
In addition, some conversion and overhaul costs were not
charged as required, and many spare parts and other
supplies were left on board at no cost to the recipients

According to Navy officials, there are often political and
diplomatic considerations and pricing precedents that the
Office of the Chief of Naval Operations perceives as
outweighing approved pricing methods

The Navy has taken some corrective actions and is deter-
mining whether changes to policies are required How-
ever, Defense does not agree with GAO that it provide
Congress with more pricing information for certain ships
which are to be sold



                      S117 123879





              G
                     7r                                      GAO/NSIAD-84-7
                  'ICCOUAPRIL 12, 1984

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