Cash Impact of the Consumable Item Transfer, Phase II.

Abstract

This audit was requested by the Under Secretary of Defense (Comptroller), Deputy Comptroller(Program and Budget). This report is the third in a series of reports regarding the consumable item transfer (CIT), phase II. The Deputy Secretary of Defense directed the transfer of the management of consumable items to Defense Logistics Agency (DLA) in July 1990. The transfer process was separated into 2 phases. Phase 1, was completed in November 1995, and phase II into two phases. Phase 2 was scheduled for completion in FY 1998. In November 1995, the Military Departments threatened to stop the phase II transfer unless DLA agreed to reimburse the Military Departments' Supply Management business areas of their Defense Working Capital fund to compensate the Military Department for the estimated lost sales revenue from phase II items. As a result, the Under Secretary of Defense (Comptroller), Deputy Comptroller (Program and Budget), issued Program Budget Decision No. 425 in December 1996, which showed the potential cash impacts or the Military Departments' Supply Management business areas of the Defense Working Capital find to be $146.4 million for FY 1996 and $394.1 million for FY 1997. For FY 1996, Inspector General, DoD, Report No. 97-106, "Consumable Item Transfer, Phase II, Cash Imbalance Issue," March 5, 1997, stated that DLA calculated the reimbursement to the Military Departments at $66.5 million (see Appendix B). The Audit Objectives were to report on the cash impact of the CIT, phase II, during FYs 1997 and 1998 on the Army, Navy, Air Force, and DLA Supply management business areas of the Defense Working Capital fund. We also included review of the management control program as it applied to the audit objectives. This report discusses the cash impact of the CIT, phase II for FY 1997.

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Document Details

Document Type
Technical Report
Publication Date
Feb 11, 1998
Accession Number
ADA368231

Entities

Organizations

  • Office of the Inspector General, U.S. Department of Defense

Tags

Communities of Interest

  • Weapons Technologies

DTIC Thesaurus Topics

  • Air Force
  • Auditing
  • Commerce
  • Comptrollers
  • Department Of Defense
  • Financial Management
  • Governments
  • Information Exchange
  • Inventory
  • Inventory Control
  • Logistics
  • Money
  • National Security
  • Navy
  • Security
  • Standards
  • United States

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