About | HeinOnline Law Journal Library | HeinOnline Law Journal Library | HeinOnline
LOG IN
LOG IN

GAO-01-178R 1 (2001-01-11)

handle is hein.gao/gaocrptamww0001 and id is 1 raw text is: G AO Accountability * Integrity* Reliability United States General Accounting Office Washington, DC 20548 January 11, 2001 The Honorable Richard Danzig The Secretary of the Navy Subject: Navy Aviation Spare Parts Billing Transaction Issues Dear Mr. Secretary: Earlier this year, we conducted a review of price trends for Navy aviation spare parts.1 During the course of the review, we compared the prices customers were billed to the prices they should have paid according to the parts catalog maintained by the Naval Inventory Control Point-Philadelphia. In doing so, we identified thousands of billing transactions where the customers' price did not match the catalog price. Moreover, we found thousands of additional transactions in which key information used to generate accurate customer bills was missing. These findings suggest that the Navy may be incorrectly reporting its sales of aviation spare parts. This letter discusses our findings in greater detail and provides suggested actions the Navy can take to improve the accuracy of its billings. Background The Naval Inventory Control Point uses billing transaction information to report its annual sales of spare parts.2 These sales are made either at the net or the standard price. Customers pay the net price when they turn in a broken item to be repaired; otherwise they pay the higher standard price. In fiscal year 1999, the average net price was $7,390 and the average standard price was $29,888. When customers order parts, they supply an advice code as part of the requisition process. The Inventory Control Point uses this code to determine whether customers will be billed at the net or standard price. The most common advice code, 5G, for example, indicates that the customer will turn in a broken part, in which case a bill is generated at the net price. Over 90 percent of the time, customers turn in a broken part and pay the net price. We obtained from the Naval Inventory Control Point billing transactions for aviation spare parts covering fiscal years 1994 through 1999. These transactions, extracted from the Navy's Billing History File, were segregated into two categories - net and standard sales - for each ' Defense Acquisitions: Prices of Navy Aviation Spare Parts Have Increased (GAO-01-23, Nov. 6, 2000). 2 A transaction can be a bill or a bill reversal. The latter is used to correct billing errors. GAO-01-178R Navy Billing Issues

What Is HeinOnline?

HeinOnline is a subscription-based resource containing thousands of academic and legal journals from inception; complete coverage of government documents such as U.S. Statutes at Large, U.S. Code, Federal Register, Code of Federal Regulations, U.S. Reports, and much more. Documents are image-based, fully searchable PDFs with the authority of print combined with the accessibility of a user-friendly and powerful database. For more information, request a quote or trial for your organization below.



Contact us for annual subscription options:

Contact Us

Already a HeinOnline Subscriber?

Log In

profiles profiles most