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093128 1 (1974-08-06)

handle is hein.gao/gaobacugs0001 and id is 1 raw text is: #1 9 & U UNITED STATEb kENRAU, ACCOUNTING OFFICE REGIONAL OFFICK ROOM 7Ql', ECDEflAI, fUILDINC SVNORTH LOS ANGELEC STREET Los ANGELE;s CALIFORNIA S001Z AUG 6 1974 Mr. Alex Soil Regional Manager Defense Contract Audit Agency 13h0 West 6th Street, 2nd Floor Lou Angeles, California 90017 Dear Mr. Solls . o3V$A ,-NIE As part (fC a nationwide rreiew of tiw offectiveness of Defenae procuremenL regulations concerningaubcontroct coat or pricing data submissioiss, we have examined theLprices prbposed and negotiated for major firm fixed-price subcontracts involving cable assemblies procured from Amphenol Space and Missile Eystems Division, Bunker- Ramo CorporAtion, Chatsworth, California, under fixed-price incentive prime contractn for the fiscal year 1972 MINUTEMAN III missile procurement. In particular, our review included suboontracts A1MM-528334 anI A2MM-528336 awarded by the Autonetics Group, Rockwell International Corporation, under contract FO7l0-69-C-0.194 and suboon- tract 633693-28(29) awarded by the Bell Aerospace Company under contract FO'401-71-C-0038. Our review primarily conceried the reasonableneso of the subcontract estimaten included in the prime contract prices in relation to cost or pricing data available at the time of prime contract or subcontract negotiations. We found that; The amount negotiated in the target price of contract -0194 for the Amphenol subcontract effort was about $986,000 higher than indicated by available cost data at the time of prime contract negotiations. - The amount negotiated in the target price ot contract -0038 for the Amphenol eucontract effort was about $206,100 higher than .±ndicated by available coat data at the time of subcontract negotiations. In each of these procurements, the preayard auditsa o the subcontractor's proposals did not identify more current, completa, and acculirate cost data for consideration by the contracting officers during prime con- tract negotiations. r. - - .. .. I A- /441 LStcon- ?ze -77. V 7ti'P t I 4 9 491'S 1. I. S S I * t I I F 0 0

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