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092392 1 (1972-04-13)

handle is hein.gao/gaobacwha0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 INTERNATIONAL DIVISION APR 1 3 197Z Dear General Seignious: We have reviewed selected aspects of the United States assistance program to the North Atlantic Treaty Organization Maintenance and Supply Agency (NAMSA). Our review was directed toward examining into whether the United States was realizing maximum benefit from its investment in NAMSA and the effectiveness of management of U.S. interests by the Department of Defense and the Department of State. Our review was generally limited to an examination of financial reports and other NAMSA documents available in U.S. Government offices. Information on NAMSA's activities consisted mostly of published reports and official documents distributed to the participating members. All member countries are restricted from direct access to the organization's records, therefore, we were unable to independently verify the account balances and summaries of transactions shown in NAMSA's reports. The United States made available to NAMSA about $56 million of material, supplies and equipment for use in three of its major programs. Themesults of our review into this area are described below. Recovery of U.S. Investments in NAMSA The United States has recovered from NAMSA, in the form of credit and supplies, about $46 million of its total assistance of $56 million. Most of the recovered assistance value was used to fill other U.S. military assistance requirements in Greece and Turkey. In this sense, the assistance to NAMSA differed from most military assistance programs where benefits to the United States have been measured largely in terms of U.S. contributions to security and defense of the countries involved. In March 1971, NAMSA indicated that additional credit returns of about $400,000 may be expected, however, we were advised by Department of Defense officials in March 1972 that the United States had received no further recoveries. Our review showed that Department of Defense use of $46 million returned by NAMSA in credit and supplies for military assistance to Greece and Turkey was not specifically reported to Congress. No report to Congress was made because of the Department of Defense view that such returns represent commodities as explained in section 605(b) of the Foreign Assistance Act of 1961, as amended. We believe, however, that

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