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GAO-06-838R 1 (2006-07-07)

handle is hein.gao/gaocrptatrb0001 and id is 1 raw text is: i= i United States Government Accountability Office Washington, DC 20548 July 7, 2006 The Honorable John Warner Chairman The Honorable Carl Levin Ranking Member Committee on Armed Services United States Senate The Honorable Duncan Hunter Chairman The Honorable Ike Skelton Ranking Member Committee on Armed Services House of Representatives Subject: Contract Management: DOD Vulnerabilities to Contracting Fraud, Waste, and Abuse In recent years, the Department of Defense (DOD) has increasingly relied on goods and services provided by the private sector under contract. Since fiscal year 2000, DOD's contracting for goods and services has nearly doubled, and this trend is expected to continue. In fiscal year 2005 alone, DOD obligated nearly $270 billion on contracts for goods and services. Given the magnitude of the dollar amounts involved, it is essential that DOD acquisitions be handled in an efficient, effective, and accountable manner. In other words, DOD needs to ensure that it buys the right things, the right way. Enacted January 6, 2006, the National Defense Authorization Act for Fiscal Year 2006' required us to review DOD's efforts to identify and assess the vulnerability of its contracts to fraud, waste, and abuse. We reviewed the areas of vulnerability that DOD faces with regard to contracting fraud, waste, and abuse, and the recent initiatives that DOD has taken to address these vulnerabilities, including actions DOD has taken in response to a March 2005 Defense Science Board report on management oversight in acquisition organizations. Because of the limited time available to conduct our work, we relied heavily on a review of GAO and DOD Office of the Inspector General (DOD IG) reports issued over the past 5 years (listed in app. I) supplemented by interviews with senior acquisition policy, general counsel, and investigative service officials at the Office of the Secretary of Defense level and within each of DOD's military departments. We also reviewed relevant studies prepared by or for DOD, the most notable of which is the report written by the Defense Science Board, a panel of high-level GAO-06-838R DOD Contracting 'Pub. L. No. 109-163, sec. 841. Page 1

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