Download or read book Defense Contractor Restructuring DoD Risks Forfeiting Savings on Fixed Price Contracts written by General accounting office washington dc national security and international affairs div and published by . This book was released on 1998 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt: Section 818 of the National Defense Authorization Act for Fiscal Year 1995 (P.L. 103-337) requires us to report periodically to the Congress on the implementation of the Department of Defense's (DOD) policy on defense contractor restructuring. We have issued three reports pursuant to this legislative requirement. This report focuses on DOD's use of contract price adjustment clauses, also called reopener clauses, which can be used to ensure that DOD receives its fair share of contractor restructuring savings on fixed-price contracts awarded to companies involved in a business combination between the time a combination is announced and the time that restructuring savings are reflected in the mechanism used for pricing contracts. Specifically, we discuss (1) DOD'S limited use of reopener clauses for these contracts and (2) the potential benefits of using reopener clauses in future business combinations. As a result of the significant decline in defense expenditures since the late 1980s, defense contractors have been consolidating and restructuring their operations to increase efficiencies and become more competitive in the defense marketplace. Many of the consolidation and restructuring activities resulted from defense contractor acquisitions and mergers. In July 1993, the Under Secretary of Defense for Acquisition concluded that it was in the government's best interest to encourage defense contractors to consolidate and restructure their operations, which was expected to reduce costs to DOD. To achieve that goal, the Under Secretary stated that DOD would pay restructuring costs on contracts transferred as part of a merger or acquisition if the business combination was expected to result in overall reduced costs for DOD or preserve a critical capability that might otherwise be lost.
Download or read book Defense Contractor Restructuring written by United States. General Accounting Office and published by . This book was released on 1998 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Nsiad 98 162 Defense Contractor Restructuring written by United States Accounting Office (GAO) and published by Createspace Independent Publishing Platform. This book was released on 2018-02-10 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: NSIAD-98-162 Defense Contractor Restructuring: DOD Risks Forfeiting Savings on Fixed-Price Contracts
Download or read book Defense Contractor Restructuring written by U S Government Accountability Office (G and published by BiblioGov. This book was released on 2013-07 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: Pursuant to a congressional request, GAO provided information on seven defense contractor business combinations to determine whether the Department of Defense (DOD) is realizing savings as a result of such restructuring activities, focusing on: (1) the amount of restructuring savings expected by DOD from the seven business combinations; (2) the impact of selected restructuring activities on the contractors' cost of operations; and (3) whether savings could be traced to contract prices. GAO noted that: (1) for the seven business combinations GAO reviewed, DOD expects that it will save about $3.3 billion from contractor restructuring activities, such as laying off workers, closing facilities, and relocating employees and equipment; (2) GAO's assessment of selected restructuring activities showed that they had lowered the cost of operations at the seven business combinations by hundreds of millions of dollars; (3) such reductions benefited DOD because the costs of defense contracts were lower than they would have been if the restructuring activities had not occurred; (4) determining the precise impact of restructuring on specific contract prices requires isolating the impact of these activities from nonrestructuring-related factors, such as changes in business volume, quantities purchased, and accounting practices; and (5) DOD, selected business segments, and GAO were generally not able to isolate the effects of restructuring from those of other factors.
Download or read book Defense Industry Restructuring Updated Cost and Savings Information written by and published by . This book was released on 1998 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In July 1993, DOD changed a long-standing practice and permitted defense contractors to charge restructuring costs to transferred flexibly priced contracts, provided (1) the restructuring costs were allowable under the Federal Acquisition Regulation and (2) a DOD contracting officer determined the business combination would result in overall reduced costs to DOD or preserve a critical defense capability. Concerns over the payment of such costs led Congress to pass legislation requiring that certain conditions be met before DOD reimbursed defense contractors for restructuring-related expenses. The legislation required, in part, that a senior DOD official certify that projections of restructuring savings are based on audited cost data; DOD'S share of projected savings exceeds allowed costs; and the Secretary of Defense reports to Congress On DOD'S experience with defense contractor business combinations, including whether savings associated with each restructuring actually exceed restructuring costs. The Secretary of Defense is currently required by 10 U.S.C. 2325 to determine in writing that the savings will be at least twice the amount of allowed costs or that projected savings will exceed costs allowed and that the combination will result in the preservation of a critical capability.
Download or read book Defense Industry Restructuring Costs Paid Savings Realized and Means to Ensure Benefits written by and published by . This book was released on 1998 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: To encourage defense contractor consolidations, DOD announced in July 1993 that it would pay for restructuring costs on transferred flexibly priced contracts, provided that (1) the restructuring costs were allowable under the Federal Acquisition Regulation and (2) a DOD contracting officer determined that the business combination was expected to result in overall reduced costs to DOD or preserve a critical defense capability. Concerns over the payment of restructuring costs led Congress in 1994 to pass Public Law 103-337, which required a senior DOD official to certify that projections of restructuring savings were based on audited cost data and that the projected savings should result in overall reduced costs to DOD.
Download or read book Defense Contracting Improved Insight and Controls Needed over DOD s Time and Material Contracts written by and published by DIANE Publishing. This book was released on with total page 54 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Defense Contracting written by Ann Calvaresi Barr and published by DIANE Publishing. This book was released on 2008-11 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: One-third of the DoD FY 2006 spending on goods and services was for subcontracts. Concerns have been raised among DoD auditors and Congress about the potential for excessive pass-through charges by contractors that add little or no value when work is subcontracted. To better understand this risk, this report assesses the extent to which DoD may be vulnerable to these charges, and examines: (1) DoD¿s approach to assessing the risk of excessive pass-through charges when work is subcontracted; (2) the strategies that selected private sector companies use to minimize risks of excessive pass-through charges when purchasing goods and services; and (3) DoD¿s interim rule to prevent excessive pass-through charges. Illustrations.
Download or read book Contract Pricing written by United States. General Accounting Office and published by . This book was released on 1994 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Defense Acquisitions Termination Costs are Generally Not a Compelling Reason to Continue Programs or Contracts That Otherwise Warrant Ending written by and published by DIANE Publishing. This book was released on 2008 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: The nation's long-term fiscal imbalances will likely make DOD's 1.6 trillion planned investment in new weapon systems unsustainable. Thus, it is critical that DOD retains the flexibility to end programs and contracts when necessary and appropriate. Although the federal government generally has the legal right to terminate contracts for convenience, defense stakeholders have sometimes expressed concerns that it will cost more to terminate a contract than to complete it. To address this perception, GAO examined (1) how expected contract termination costs and other factors affect DOD decisions on whether to end programs and contracts; (2) the circumstances under which it would cost more to terminate a contract for convenience than to complete it; and (3) the options DOD has for retaining value or reducing costs, when DOD ends programs or contracts. To do this, GAO examined DOD data on terminated contracts over $100 million; reviewed laws, regulations, and guidance; and met with key DOD officials. GAO recommends that DOD review, and as needed amend, guidance on terminations across the military services and DOD agencies to ensure that termination guidance identifies the conditions under which it is appropriate to end programs or contracts, and provides knowledge needed to use terminations as an investment portfolio tool. DOD agreed.
Download or read book DOD Policy on Defense Industry Mergers Acquisitions and Restructuring written by United States. Congress. House. Committee on Armed Services. Oversight and Investigations Subcommittee and published by . This book was released on 1995 with total page 140 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Indexes for Abstracts of Reports and Testimony written by and published by . This book was released on 1998 with total page 564 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Defense Contractor Restructuring written by United States Accounting Office (GAO) and published by Createspace Independent Publishing Platform. This book was released on 2018-06-11 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: Defense Contractor Restructuring: First Application of Cost and Savings Regulations
Download or read book Abstracts of Reports and Testimony written by and published by . This book was released on 1998 with total page 246 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Price based Acquisition written by Mark A. Lorell and published by Minnesota Historical Society. This book was released on 2005 with total page 208 pages. Available in PDF, EPUB and Kindle. Book excerpt: This report presents findings from a research study conducted by RAND Project AIR FORCE, a division of the RAND Corporation, to examine the effects of using price-based acquisition (PBA) approaches for the development and production of major Air Force weapon systems, subsystems, and other military-unique articles. Typically in these cases, the cost-based acquisition (CBA) approach is used-i.e., the price to develop and produce such an article is based on cost data that the government requires the contractor to provide. Critics of this traditional, CBA method see it as imposing heavy regulatory burdens on the government and the contractor and tending to discourage potential non-defense contractors from competing for government contracts, thus reducing competition and quality and increasing cost.
Download or read book Defense Contractor Restructuring First Application of Cost and Savings Regulations written by and published by . This book was released on 1996 with total page 10 pages. Available in PDF, EPUB and Kindle. Book excerpt: Section 818 of the National Defense Authorization Act for Fiscal Year 1995 (P.L. 103-337) restricts Department of Defense (DOD) payments to contractors for costs associated with business combinations. Specifically, it prohibits the payment of restructuring costs, such as those associated with closing facilities and eliminating jobs, until a senior DOD official certifies that projected savings from the restructuring are based on audited data and should result in overall reduced costs to DOD. In response to section 818 requirements, DOD issued interim regulations on restructuring costs effective December 29,1994.
Download or read book Month in Review written by and published by . This book was released on 1998-07 with total page 264 pages. Available in PDF, EPUB and Kindle. Book excerpt:
