Foreign Military Sales
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Home > Society and Social Sciences > Politics and government > Foreign Military Sales: Dod's Stabilized Rate Can Recover Full Cost: Aimd-97-134
Foreign Military Sales: Dod's Stabilized Rate Can Recover Full Cost: Aimd-97-134

Foreign Military Sales: Dod's Stabilized Rate Can Recover Full Cost: Aimd-97-134


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About the Book

Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) use of stabilized rates for charging foreign military sales (FMS) customers for goods and services sold through DOD's Defense Business Operations Fund (DBOF), focusing on whether: (1) there is a dollar difference in pricing goods and services at full cost compared to the stabilized rate; and (2) DOD's current practice of billing foreign customers at the stabilized rate is consistent with the full cost requirements of the Arms Export Control Act of 1976. GAO noted that: (1) DOD's stabilized rate generally is designed to recover full costs from DOD and FMS customers over the long term; (2) the concept of applying the stabilized rate is a viable method to recover the cost of goods and services from these customers; (3) GAO's analysis of cost elements in the stabilized rates showed that generally, the stabilized rate included the cost elements necessary to recover full cost; (4) however, GAO did identify two cost elements--pension and postretirement health benefits--related to retirement benefit costs of civilian personnel working on FMS cases, that were not included in the stabilized rates; (5) GAO estimates that Working Capital Fund (WCF) supply activities undercharged FMS customers at least $40.5 million during fiscal years (FY) 1992 through 1996 and will undercharge millions more in FY 1997; (5) GAO discussed this matter with DOD officials and they agreed that not all civilian retirement benefit labor costs were included in the rates that activities were charging FMS customers; and (6) they now plan to revise their policy to require that this cost be included in the prices charged FMS customers.


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Product Details
  • ISBN-13: 9781289225322
  • Publisher: Bibliogov
  • Publisher Imprint: Bibliogov
  • Height: 246 mm
  • No of Pages: 24
  • Spine Width: 1 mm
  • Weight: 64 gr
  • ISBN-10: 128922532X
  • Publisher Date: 22 Jul 2013
  • Binding: Paperback
  • Language: English
  • Returnable: N
  • Sub Title: Dod's Stabilized Rate Can Recover Full Cost: Aimd-97-134
  • Width: 189 mm


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