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NSIAD-85-23 1 (1984-11-19)

handle is hein.gao/gaobabnnq0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE - WASHINGTON, D.C. 20548 NATIONAL SECURITY AND NOVEMBER 19, 1984 INTCRNATIONAL AFFAIRS DIVISION B-216913 The Honorable John F. Lehman The Secretary of the Navy Dear Mr. Secretary: Subject: Navy Material In Suspended, Not Ready for Issue, Condition Needs More Management Attention (GAO/NSIAD-85-23) Our review of the Navy's management of material in suspended, not ready for issue, status showed that improvements are needed to reduce the amount and age of this material. The value of the Navy material reported in this condition is about S200 million. Material is assigned a suspended condition code (J, K, or L) when there is a question regarding its true condition and some additional testing or inspection is required before it can be con- sidered ready for issue. Defense and Navy policy emphasize the importance of removing this material from a suspense category in a timely manner. Stock placed in suspense code J should be reclas- sified within 90 days and code K material within 10 days. No specific time limit has been set for code L material but both De- fense and Navy regulations emphasize that suspensions should not last indefinitely. We found the policy on reclassifying suspended material in a timely manner was not being followed. Our tests at the Norfolk and Oakland Naval Supply Centers showed that the average suspen- sion time was 21 months. Further analysis at Norfolk indicated that 88 percent of the material had been suspended over 3 months, 60 percent over 1 year, and 28 percent over 2 years. Lengthy suspension times have adversely affected supply operations because this material has not been considered in filling requisitions and making procurement decisions. Item managers at the inventory control points often did not know the true condition of the suspended material, why the material was suspended, who initiated suspension, or what actions were being taken to reclassify the material. As a result, new procurements had been initiated on at least 25 percent of the 189 Norfolk line items discussed with item managers. Timely reclassification could have precluded the need for some of these procurements. (943574) 125613

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