GAO Pricing Reviews at Selected Subcontractor Locations

Gao ID: T-NSIAD-87-44 September 23, 1987

GAO discussed the results of its pricing reviews of nine Department of Defense (DOD) subcontractors, focusing on the subcontractors' compliance with the Truth in Negotiations Act. GAO found that: (1) eight of the nine subcontractors overstated their contract prices by a total of $5.2 million because they failed to disclose accurate, complete, and current prices to their prime contractors; and (2) one subcontractor failed to provide its prime contractor access to certain records which contained unallowable cost data. GAO believes that improvements are required in prime contractor analyses of their subcontractors' proposals prior to submission to contracting agencies.



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