Accession Number:

ADA193316

Title:

Current Government Profit and Cost Policies and their Adverse Impact on Defense Contractors

Descriptive Note:

Memorandum rept.

Corporate Author:

MACHINERY AND ALLIED PRODUCTS INST WASHINGTON DC

Personal Author(s):

Report Date:

1987-11-01

Pagination or Media Count:

24.0

Abstract:

This factual review and commentary first discusses the following profit and cost policies and related developments which, although not necessarily purporting to be all inclusive on the issue, are illustrative of the problem 1 The Defense Financial and Investment Review DFAIR 2 The resulting DOD profit policy regulations 3 The General Accounting Office reaction to DODs profit policy 4 Reductions in progress payments 5 Limitations on government reimbursement for contractor acquisition of special tooling and special test equipment 6 Use of firm fixed-price contracting for development work 7 Forcing contractors to pay up-front development costs 8 Tightening of the contract cost principles generally 9 Limitations on contractor employee compensation both executive compensation and employee salaries and wages 10 Government demands for a share of pension fund assets on termination of an overfunded defined benefit pension plan 11 Overhead cost certification requirements 12 Overhead cost controls and 13 Spare parts refund policy.

Subject Categories:

  • Administration and Management

Distribution Statement:

APPROVED FOR PUBLIC RELEASE