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B-159724 1 (1973-01-20)

handle is hein.gao/gaobaagdn0001 and id is 1 raw text is: 



                  UNITED STATES GENERAL ACCOUNTING OFFICE
         /                WASHINGTON, D.C. 205-48
                         1L L,\Wd [ i P
PROCU MM.CT AND S'rSTMS                              LM096324
  ACQUISITION DIVISION

    B-159724        ' •'. .
                                         ...

    The Honorable
    The Secretary of Defense

         Attention: Assistant Secretary of
                       Defense (Comptroller)

    Dear Mr. Secretary:                 3TST            YP.T .1E

         We completed a selective examination of subcontract
    estimates included in prime contract prices negotiated on the
    basis of cost or pricing data subniitted and certified as re-
    quired by Public Law 87-653, the Truth-In-Negotiations Act.'
    Effective 'January 1, 1970, contracting officials were re-
    quired to have prime contractors who submit cost or pricing
    data with their prop-osals obtain cost or pricing data from
    prospective subcontractors in support of major subcontract
    estimates. ,'We wanted to find out whether contracting offi-
 cials had requirod prime contractors (1) to support major
 .  subcontract estimates with subcontractor cost or pricing
    data, (2) to fully justify requests for exemption from the
    requireent to furnish such data, and (3) to make a cost
 b  analysis of subcontractors' proposals and to use this infor-
    mation in evaluating the reasonableness of subcontract esti-
    mates.

         We performed tho exanination at five procurement of-
    fices selecto 3 bedcause zfhhyld awarded a significant nu,.e '
    of h , hvalu- contracts during the first half of fiscal year
    1972.  ,,  ev      rl_ sj'_conti''ut  estirates,  valuel  az  about
    $177  r.i -,, inciud-  _.n  t.c  arizes  of  -0  pr ,-   c),-, c
    valu. d a-t a   o'-     1 c nin The procurement offices re-
       S:(}:-'-'F['  or  >:e  -j; :',_:=  a>,:  cac0  DrIz:  COntr&Ct2  rov.,'wi '
    are i,   i-  :  !  -   ci o     to this rCpor-c

         II the maority of cases, contracting officers did not
    require tho contractors to subm-it or identify supporting
    subcontractor cost or pricing data to the extent required
    by the Armed Services Procurement Regulai;on (ASPR). Other

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