Consumable Item Transfer, Phase 2, Management

The audit was requested by the Under Secretary of Defense Comptroller and the Assistant Deputy Under Secretary of Defense Materiel and Distribution Management, Office of the Deputy Under Secretary of Defense Logistics. This report is the second in a series of reports regarding the consumable item transfer, phase II. Inspector General, DoD, Report No. 97-106, Consumable Item Transfer, Phase 11, Cash Imbalance Issue, March 5, 1997, discussed the cash imbalance issue related to transferring consumable items from the Military Departments to the Defense Logistics Agency DLA. In July 1990, the Deputy Secretary of Defense approved the transfer of the management of about 1.2 million consumable items from the Military Departments to the DLA. In phase I, about 760,000 consumable items were transferred to DLA over a 4-year period that ended in November 1995. Phase II, which began in January 1996, included more complex and sophisticated consumable items than phase I. Except for specially designated items that were to be retained for the Military Departments to manage, phase II items were to be transferred to DLA. The Military Departments identified about 151,000 items to be transferred to DLA during phase II. As of March 1997, the Military Departments had transferred about 83,000 of those items.