Army Logistics

Better Management of the Army's Unserviceable Inventories Could Save Millions Gao ID: NSIAD-91-23 November 30, 1990

Pursuant to a congressional request, GAO examined the Army's plans for using its unserviceable asset inventories.

GAO found that: (1) at three Army inventory control points, item managers initiated purchases for new assets without considering the potential for repairing unserviceable items in storage; (2) the Army could have repaired between 167 and 285 of the 815 items the inventory control points procured for less than the cost of purchasing new assets; (3) those item repairs could have saved $21.1 million to $35.9 million and enhanced readiness by making the assets available sooner; (4) the Army's emphasis on high stock availability and funding plans contributed to buying instead of repairing items; (5) the Army continued to store 27 percent of irreparable and consumable assets that it could dispose of; (6) of 140 sampled stored items, 30 unserviceable assets valued at $485,391 were beyond economic repair; (7) the inventory control points retained unneeded materiel, since current retention policies allowed item managers to keep any item and disposal actions were low priority; and (8) although issues involving unserviceable assets were reported before, the Army's internal controls were not effective in ensuring the implementation of corrective actions.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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