Procurement Prices Paid on Missile Systems for Foreign Military Sales
INSPECTOR GENERAL DEPT OF DEFENSE ARLINGTON VA
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Foreign military sales FMS customers procure missile systems from the Military Departments through Letters of Offer and Acceptance. The Military Department contracting officers negotiate missile system procurements with contractors for DoD and FMS customers. With the exception that prices for FMS can include contractor and U.S. Government additive charges not applicable to DoD prices, the Military Departments are required to provide FMS customers the same contract pricing afforded to DoD customers. From October 1, 1989, through March 31, 1993, 148 FMS cases had missile deliveries amounting to 1.6 billion. We reviewed 45 of those FMS cases valued at 1.3 billion. Objectives. The objectives of the audit were to determine whether prices FMS customers paid to DoD contractors for missiles were comparable to prices DoD customers paid. We also determined whether contractor and U.S. Government additive charges were valid and accurate.
- Economics and Cost Analysis