High Risk Series: Defense Inventory Management (Letter Report, 02/95,
GAO/HR-95-5).

In 1990, GAO began a special effort to identify federal programs at high
risk of waste, fraud, abuse, and mismanagement.  GAO issued a series of
reports in December 1992 on the fundamental causes of the problems in
the high-risk areas.  This report on defense inventory management is
part of the second series that updates the status of this high-risk
area. Readers have the following three options in ordering the high-risk
series: (1) request any of the individual reports in the series,
including the Overview (HR-95-1), the Guide (HR-95-2), or any of the 10
issue area reports; (2) request the Overview and the Guide as a package
(HR-95-21SET); or (3) request the entire series as a package
(HR-95-20SET).

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  HR-95-5
     TITLE:  High Risk Series: Defense Inventory Management
      DATE:  02/01/95
   SUBJECT:  Military inventories
             Inventory control systems
             Management information systems
             Military cost control
             Spare parts
             Industrial funds
             Deficit reduction
             Logistics
             Combat readiness
             Human resources training
IDENTIFIER:  High Risk Series 1995
             DOD Corporate Information Management Initiative
             CIM
             Defense Business Operations Fund
             
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Cover
================================================================ COVER


High-Risk Series

February 1995

DEFENSE INVENTORY MANAGEMENT

GAO/HR-95-5

Defense Inventory Management


Abbreviations
=============================================================== ABBREV

  CFO - Chief Financial Officer
  CIM - Corporate Information Management
  DBOF - Defense Business Operations Fund
  DLA - Defense Logistics Agency
  DOD - Department of Defense

Letter
=============================================================== LETTER



February 1995

The President of the Senate
The Speaker of the House of Representatives

In 1990, the General Accounting Office began a special effort to
review and report on the federal program areas we considered high
risk because they were especially vulnerable to waste, fraud, abuse,
and mismanagement.  This effort, which has been strongly supported by
the Senate Committee on Governmental Affairs and the House Committee
on Government Reform and Oversight, brought much needed focus to
problems that were costing the government billions of dollars. 

In December 1992, we issued a series of reports on the fundamental
causes of problems in designated high-risk areas.  We are updating
the status of our high-risk program in this second series.  Our
Overview report (GAO/HR-95-1) discusses progress made in many areas,
stresses the need for further action to address remaining critical
problems, and introduces newly designated high-risk areas.  This
second series also includes a Quick Reference Guide (GAO/HR-95-2)
that covers all 18 high-risk areas we have tracked over the past few
years, and separate reports that detail continuing significant
problems and resolution actions needed in 10 areas. 

This report describes our concerns over the Department of Defense's
management of supplies that support the military services.  It
focuses on the need for the Department to be more aggressive in
changing its management culture through taking advantage of new
management practices, technologies, and logistics systems so that
inefficiencies can be eliminated and high levels of readiness
maintained. 

Copies of this report series are being sent to the President, the
Republican and Democratic leadership of the Congress, congressional
committee chairs and ranking minority members, all other members of
the Congress, the Director of the Office of Management and Budget,
and the Secretary of Defense. 

Charles A.  Bowsher
Comptroller General
of the United States


OVERVIEW
============================================================ Chapter 0

The Department of Defense (DOD) uses its secondary inventory--spare
and repair parts, clothing, medical supplies, and other support
items--to support its operating forces.  In September 1993, DOD
reported that it had an inventory of $77.5 billion.  We estimate that
about $36.3 billion of the inventory represents items that are not
needed to be on hand to support DOD's war reserve or current
operating requirements.\1

THE PROBLEM

In 1992, we reported that DOD had wasted billions of dollars on
excess supplies and burdened itself with the need to store them.\2

The problem resulted from DOD's culture that believed it was better
to overbuy items than to manage with just the amount of stock needed. 
The culture prevented DOD from using effective inventory management
and control techniques and modern commercial inventory management
practices that would allow lower inventory levels. 

PROGRESS

To its credit, DOD has achieved some inventory reductions, initiated
some pilot projects, and recognized that it must improve its
inventory management.  However, DOD has made little overall progress
in correcting long-standing management problems that perpetuate
buying and holding too much inventory.  For example, DOD stores
billions of dollars of unneeded inventory, requirements continue to
be overstated leading to unnecessary procurements, and modern
commercial practices are not being implemented as fast as possible. 

DOD's inventories and inventory funding levels remain relatively high
while the operating forces supported by the inventories have
decreased and are projected to continue decreasing. 

Two current efforts that potentially affect DOD's inventory
management capabilities have experienced problems--the Corporate
Information Management (CIM) initiative is suffering from fundamental
weaknesses in DOD's implementation strategy, and the Defense Business
Operations Fund (DBOF) is not working as DOD had intended. 

OUTLOOK FOR THE FUTURE

DOD has had limited success with some commercial inventory practices
that have substantially reduced costs while meeting managers'
inventory needs.  However, DOD still needs to be more aggressive in
changing its inventory management culture in order to ensure high
levels of readiness within existing resource constraints.  DOD also
must take advantage of new management practices, technologies, and
logistics systems. 

DOD's top management needs to be much more attentive to the CIM and
DBOF initiatives because they will provide managers with the critical
tools needed for managing inventory in the future.  DOD must also
improve the accuracy of inventory data.  Finally, congressional
oversight is necessary to maintain DOD's focus on these problems. 


--------------------
\1 The $77.5 billion and the $36.3 billion includes inventory that
has been revalued to reflect the value of items that need to be
repaired and the scrap value of items to be disposed of.  We estimate
that if all the inventory were valued at its acquisition cost, the
values would be $96.8 billion and $48.4 billion, respectively. 

\2 High-Risk Series:  Defense Inventory Management (GAO/HR-93-12,
Dec.  1992). 


MANAGING DOD'S INVENTORY PRESENTS
CHALLENGES
============================================================ Chapter 1

In 1989, DOD's forces included about 2.1 million active duty solders,
sailors, marines, and airmen; over 2,800 attack and fighter aircraft;
about 570 ships; and 18 active Army divisions.  To support these
forces, DOD had inventories of spare and repair parts, clothing,
medical supplies, and other support items.  The inventory was valued
at about $92.5 billion, with an acquisition cost of about $108
billion. 

With the collapse of the Soviet Union, DOD altered threat scenarios
and began downsizing its forces.  By 1993, active duty military
personnel had decreased to about 1.7 million; active attack and
fighter aircraft to about 2,100; ships to 435; and active Army
divisions to 14.  DOD projects that its forces will continue to
decrease at least through fiscal year 1996.  Between 1989 and 1993,
the value of DOD's inventory decreased by $15 billion, to about $77.5
billion (acquisition cost of about $96.8 billion). 

Not withstanding the sizable force structure changes since 1989,
DOD's inventory funding levels have remained relatively high.  To
some extent, this reflects Defense Business Operations Fund price
increases related to the total cost of doing business.  Operations
and maintenance funds are the primary source of funds for customer
inventory purchases.  Figure 1 shows actual and estimated operations
and maintenance funds to be used for inventory purchases for fiscal
years 1992 through 1995. 

   Figure 1:  Operations and
   Maintenance Appropriations for
   Inventory (fiscal years
   1992-95)

   (See figure in printed
   edition.)

DOD has wasted billions of dollars on excess supplies, burdened
itself with the need to store them, and failed to acquire the tools
or expertise needed to manage them effectively.  DOD frequently
overestimated its supply requirements and purchased too much. 

The current downsizing environment is posing additional challenges
for DOD.  In order to ensure that high levels of readiness are
achieved, DOD must adopt new management approaches that will allow it
to sustain these high levels while dealing with resource constraints. 
At the same time, DOD must address the large amount of unneeded
inventory, currently stored in its warehouses, that will continue to
drain resources.  This problem will only increase as force reductions
continue. 

DOD's excessive inventories of unneeded items have resulted largely
from a culture that believed it is better to overbuy items than to
manage with just the amount of stock needed.  This culture has been
slow to adopt new management practices, technologies, and logistics
systems.  DOD has failed to adopt comprehensive inventory management
practices in which only those items necessary to support operations
are stored.  DOD has also failed to provide its personnel with the
tools and incentives to manage the inventory properly. 


A COMPREHENSIVE EFFORT IS NEEDED
TO CHANGE DOD'S INVENTORY
MANAGEMENT PRACTICES
============================================================ Chapter 2

In recent years, DOD has recognized that it must reduce the size and
cost of its inventory.  However, in spite of a $15 billion inventory
reduction, DOD has yet to achieve effective and efficient inventory
management.  DOD does not have adequate oversight of its inventory,
financial accountability remains weak, requirements continue to be
overstated, and DOD can be more aggressive in implementing modern
commercial practices.  Also, DOD has yet to realize the benefits of
initiatives such as DBOF and CIM. 


   STORING AND MAINTAINING
   UNNEEDED INVENTORY IS COSTING
   DOD MILLIONS
---------------------------------------------------------- Chapter 2:1

As shown in figure 2, DOD has reduced its inventory from $92.5
billion in 1989 to $77.5 billion in 1993. 

   Figure 2:  DOD's Inventory
   (fiscal years 1989-93)

   (See figure in printed
   edition.)

While DOD's inventory reduction represents progress, about half of
the $77.5 billion inventory still is beyond what is needed to be on
hand to satisfy war reserve or current operating needs.  Included in
the $77.5 billion is about (1) $36 billion of inventory that is being
retained beyond what is needed for war reserves and current
operations and (2) $286 million of inventory that DOD has designated
for reuse and disposal and that had an acquisition cost of about $14
billion.  Figure 3 breaks out DOD's inventory. 

   Figure 3:  DOD's Inventory
   (September 30, 1993)

   (See figure in printed
   edition.)

Note:  The inventory designated for reuse or disposal has an
acquisition cost of about $14 billion. 

In September 1994, we reported that for aviation parts, which account
for $39.6 billion of the $77.5 billion inventory, DOD's proceeds from
the sale of commercial-type surplus parts averaged less than 1
percent of the fiscal year 1993 cost.  We reported that DOD
emphasizes disposing items as quickly as possible.  In contrast, the
disposal systems of commercial airlines and other private sector
companies emphasize maximizing sales proceeds.  By providing
incentives and training, and by identifying highly marketable parts,
DOD could increase its proceeds. 

DOD IS SLOW IN TAKING CRITICAL
STEPS TO CHANGE CULTURE

To DOD's credit, it has acknowledged that it must change its
inventory management culture.  DOD sees training as a key tool that
can help achieve this cultural change; however, it still has not
taken steps that are essential to most effectively use training to
foster the desired change.  In August 1994, we reported that: 

DOD has not developed or promulgated written plans and guidance on
how to use training to effect its desired cultural change. 

DOD's training courses lack the content and emphasis necessary to
foster a new way of thinking about inventory management. 

Most inventory managers are not receiving the training they need to
effect cultural change. 

ADEQUATE INVENTORY OVERSIGHT HAS
NOT BEEN ACHIEVED

Information on the quantity, location, and condition of inventory is
necessary for effective and efficient inventory management.  We
previously reported that because visibility over inventories was not
adequate, managers were making improper purchase decisions.  Such
conditions persist.  For example, in May 1994, we reported that Army
managers at one base spent nearly $800,000 to repair items when
issuable assets were available in the Army's supply system.  In
another case, we reported that $67 million of material ordered for
ship overhauls was not used and was not returned to the supply system
for use on other overhauls. 

DOD's 1994 strategic plans for logistics call for improving asset
visibility in such areas as in-transit assets, retail-level stocks,
and through implementation of its CIM initiative.  DOD's asset
visibility plans will not be completely implemented until 1996. 

REQUIREMENTS CONTINUE TO BE
OVERSTATED

In December 1992, we reported that for years DOD had experienced
problems in accurately determining how much inventory it needs to
buy.  Our recent work shows that overstated requirements continue to
be a problem. 

For instance, in April 1993, we reported that two Army Commands
overstated their war reserve requirements by at least $500 million
because the requirements had not been updated and continued to
reflect a European war scenario.  We also reported that the Commands'
current operating requirements were overstated by about $1 billion
because forecasted requirements erroneously included nonrecurring
demands and failed to consider items being returned by units. 

Improvements can also be made to the Navy and Air Force requirements
determination processes.  In July 1994, we reported that the Navy's
process for determining requirements for material needed by the
shipyards was not working as intended.  For example, at the end of
fiscal year 1993, the Navy's shipyards had about $35 million of
material on hand and another $12 million of material on order for
repairs that had been completed.  We also reported that (1) shipyards
were holding millions of dollars of material that was not recorded on
official records, (2) shipyards had inadequate controls over shop
store issues, (3) shop store inventories exceeded requirements, and
(4) material was not adequately protected. 

In April 1994, we reported that the Air Force had significant amounts
of invalid back orders, which are considered as requirements in
computing stock levels, making procurement and repair decisions, and
in developing budgets.  We and the Air Force identified over $209
million of invalid back orders at 17 retail activities.  The Air
Force subsequently cancelled these orders. 

In October 1993, we reported that the Air Force had made progress in
terminating excess orders by implementing management information
systems that enable command and headquarters management to compare
the performance and measure the progress of logistics centers in
terminating orders.  However, we reported that the Air Force was
missing potential terminations because it was using an unjustified
6-month level of stock above item requirements as a buffer in
computing termination levels. 

On the basis of analyses of programs, budget support documents, and
reported inefficiencies such as those discussed above, we reported in
September 1994 that the military services' operations and maintenance
budget requests for fiscal year 1995 could be reduced by $514 million
if the services improved their management of spare and repair parts. 
The Armed Services Conference Committee subsequently recommended that
the budgets be reduced by $135 million. 

FINANCIAL ACCOUNTABILITY REMAINS
WEAK

DOD continues to lack financial accountability and control over its
inventory because it (1) does not have accurate, reliable data to
support the quantity, condition, and value of items, and (2) does not
have integrated systems to provide accurate data.  DOD recognizes
these weaknesses and is taking corrective action. 

Audit reports on DOD activities prepared to address requirements of
the Chief Financial Officers (CFO) Act have continued to show that
DOD inventory records are inaccurate.  For example, the Army Audit
Agency's report on Army's fiscal year 1993 financial operations
disclosed that it could not verify over $12 billion of inventory
records.  The Army Audit Agency estimated that 51 percent of the
inventory records sampled had inaccurate information, either in terms
of quantity or condition. 

Similarly, the Air Force Audit Agency's report on the Air Force's
fiscal year 1993 financial operations disclosed that the Air Force's
reported inventory of $6.5 billion was not reliable because of
inventory valuation, over and under reporting of quantities, and
omissions of relevant inventory data. 

With these inventory record accuracy weaknesses DOD cannot ensure
that it can meet readiness demands.  This readiness impact, as it
pertained to Operation Desert Shield/Storm, was highlighted in DOD's
fiscal year 1993 Federal Managers' Financial Integrity Act report. 
That report stated that "significant deficiencies in tracking
inventory and maintaining inventory records ...  made operational
support planning more difficult and were responsible for duplicate
orders, backlogs at aerial and sea ports, unnecessary material
shipped into the theater, difficulty in prioritizing cargo backlogs,
and inefficient intra-theater movement."

In fiscal year 1993 reports, DOD identified a number of actions that
are intended to correct these fundamental weaknesses.  DOD's primary
corrective actions include transferring management of its consumable
inventory items to a single manager and the development of a single
automated system to support item management across the services. 
These actions are intended to eliminate duplicate databases and
reduce the requirement to reconcile inventory records.  DOD is also
developing a standardized statistical sampling methodology that is to
be incorporated into its logistical procedures.  This sampling
methodology is intended to meet DOD logistical needs for record
accuracy, as well as supporting the requirements of the CFO Act. 
These corrective actions are targeted for completion from fiscal year
1994 through the end of fiscal year 1996. 

USE OF COMMERCIAL PRACTICES CAN
SAVE MILLIONS OF DOLLARS

Private sector companies are streamlining their logistics operations
by adopting innovative inventory management strategies that reduce
costs and improve the quality of service. 

As of September 1993, DOD had invested about $16.5 billion in its
food; electronics; construction, general and industrial; and clothing
and textile inventories.  During the past 2 years, we reported that
DOD has the potential to save millions of dollars relating to these
inventories by adopting commercial inventory management practices. 
For example: 

DOD buys and stores redundant levels of electronics inventories. 
Private sector practices, such as long-term relationships with
suppliers, direct delivery programs, and direct communications
between suppliers and users, have been effective in eliminating
intermediate handling and storage locations. 

DOD stores duplicate inventories of construction, general and
industrial supplies at wholesale and retail locations.  Private
sector practices include encouraging direct delivery of supplies to
industrial centers by locating suppliers at "supplier parks" near the
centers, and streamlining the ordering, bill-paying, and distribution
processes through use of electronic data interchange systems. 

DOD's food supply system encourages large inventories and unnecessary
costs because of multiple layers of warehouses.  By relying on
full-line food service distributors to move food from suppliers to
end users, private sector companies avoid the direct costs of
holding, handling, and transporting food. 

DOD stores redundant levels of clothing and textile inventories in
its wholesale and retail system.  Private sector companies use prime
vendors to provide timely and direct delivery between suppliers and
customers. 

DOD generally agrees that increased use of commercial practices could
lower costs and reduce inventories and has taken steps to expand the
use of commercial practices.  For example, the Defense Logistics
Agency (DLA) uses prime vendors for medical supplies at over 140
military hospitals.  DLA plans to implement direct vendor delivery
practices for half of all sales by fiscal year 1997.  DLA also plans
to use electronic communications and electronic data interchange for
70 percent of its procurement transactions by fiscal year 1995. 

BENEFITS OF RECENT INITIATIVES
HAVE NOT BEEN REALIZED

In 1992, we reported that DOD had begun initiatives that appeared to
be steps in the right direction for inventory management.  Most of
DOD's inventory is now accounted for in DBOF.  However, the Fund's
operation has been hindered by DOD's inability to correct problems,
such as inaccurate financial reports and fragmented and costly
accounting systems, that do not provide information needed to control
costs. 

The Fund's primary objective is to focus on managing the total costs
of carrying out certain critical DOD business operations, including
inventory management.  The Fund was intended to provide a mechanism
through which DOD could adopt a businesslike approach for identifying
and reducing operating costs. 

In April 1994, we testified that the Fund was not achieving its
objective and that DOD needed to complete the following critical
actions: 

uniformly implement policies and procedures to provide managers with
the necessary guidance to execute day-to-day operations,

select and implement systems to account for Fund resources, and

improve the accuracy of monthly financial reports that provide
information on the results of business area operations. 

We further testified that periodic assessments were critical for
determining if problems were being corrected in a timely manner. 

In addition, in June 1994, the DOD Inspector General reported that he
was unable to express an opinion on DBOF's Statement of Financial
Position because of material internal control weaknesses and
significant deficiencies in the Fund's accounting systems, that
prevented the preparation of accurate financial statements. 

In 1992, we also reported that DOD planned to use its CIM initiative
to simplify or reengineer the military services' distribution systems
and standardize computer systems in functional areas such as
logistics.  DOD projected savings of about $18 billion through
improvements to its materiel management business processes. 

In October 1994, we reported that the CIM initiative has had little
effect on materiel management business practices.  DOD had focused on
selecting standard logistics information systems--called migration
systems--that the services and DLA are to implement by mid-1997.  As
a result, business process reengineering efforts (where most savings
occur) may be delayed several years. 

We reported that although some progress had been made, several
impediments have delayed the first steps in the reengineering
process.  Three critical impediments are (1) some DOD managers in the
services and DLA have not fully accepted the initiative, (2) DOD has
not integrated its various corporate information management efforts,
and (3) initiative management authority is unclear because of
confusing DOD guidance.  For example, until April 1994 DOD had not
developed a mechanism to handle cross-functional issues. 

We also reported that DOD had not devised a management strategy to
encourage the active participation and leadership of functional
managers, particularly the service Chiefs of Staff and the DLA
Director, and had not ensured that its employees understand the
initiative objectives and implementation strategies.  As a result,
DOD has not made the cultural changes needed to successfully
implement the initiative. 


TAKING FURTHER ACTION
============================================================ Chapter 3

In 1992, we reported that major changes were needed in all levels of
DOD's inventory management system.  We reported that top management
needed to take long-range actions to (1) change the organizational
culture to eliminate the overstocking of items, (2) increase the use
of commercial practices, (3) put in place and monitor improved
performance measures that stress cost-effectiveness and inventory
reduction, and (4) improve the computer systems used in inventory
management. 

Although we have seen pockets of improvement, DOD has made little
overall progress in implementing the long-range actions necessary to
effectively and economically manage its inventory.  In order to
ensure required readiness levels and to make the most efficient and
effective use of available financial resources, DOD management needs
to commit itself to ensuring that its inventory management culture
stresses providing its forces with necessary supplies when they are
needed.  This means that DOD must not burden the supply system with
the management problems and costs associated with accumulating,
storing, and maintaining large unneeded inventories. 

Further, DOD needs to move aggressively to identify and implement
viable commercial inventory management practices for supplying its
forces.  DOD management should demonstrate its commitment to changing
its culture by implementing performance measures that stress cultural
change toward cost-effective inventory management, and by providing
its managers with the automated accounting and management systems
necessary to achieve these objectives. 

In this regard, DOD needs to move forward in an aggressive manner
with its DBOF and CIM initiatives.  For these initiatives to be
successful, the Secretary of Defense needs to (1) ensure that Fund
problems are corrected in a timely manner, and (2) DOD's top managers
are actively involved and supportive of both efforts. 

The corrective actions recommended above will not significantly alter
DOD's ineffective and inefficient inventory management practices for
several years.  As previously reported, DOD can realize savings now
by

committing to improved inventory management through top management
emphasizing (1) inventory indicators such as those that highlight
reduction and disposal of unneeded inventory, (2) the implementation
of efficient and effective inventory management practices, and (3)
training personnel in those practices,

improving the accuracy of data used to determine procurement
requirements, including the accuracy of data on the quantity,
condition, and value of inventory items managed through existing
logistics and financial systems, and

directing the military components to aggressively enforce existing
policies and procedures that will minimize unnecessary acquisition of
inventory, such as the elimination of invalid back orders. 

In addition, past inefficiencies coupled with reductions in DOD's
force structure have resulted in billions of dollars of inventory
that is not needed to support current operations.  To minimize its
inventory storage costs, DOD needs to aggressively identify and
dispose of those stocks that have little potential for future use. 
In this regard, DOD should explore ways to maximize its return on
items being disposed of by exploring commercial marketing techniques
that would improve DOD's return. 

Close congressional oversight of DOD's inventory management remains
critical to sustaining and accelerating improvements. 


RELATED GAO PRODUCTS
============================================================ Chapter 4

Defense Management:  Impediments Jeopardize Logistics Corporate
Information Management (GAO/NSIAD-95-28, Oct.  21, 1994). 

Commercial Practices:  Opportunities Exist to Enhance DOD's Sales of
Surplus Aircraft Parts (GAO/NSIAD-94-189, Sept.  23, 1994). 

1995 Budget:  Potential Reductions to the Operations and Maintenance
Programs (GAO/NSIAD-94-246BR, Sept.  6, 1994). 

Organizational Culture:  Use of Training to Help Change DOD Inventory
Management Culture (GAO/NSIAD-94-193, Aug.  30, 1994). 

Army Inventory:  Unfilled War Reserve Requirements Could Be Met With
Items From Other Inventory (GAO/NSIAD-94-207, Aug.  25, 1994). 

Defense Inventory:  Changes in DOD's Inventory, 1989-93
(GAO/NSIAD-94-235, Aug.  17, 1994). 

Navy Supply:  Improved Material Management Can Reduce Shipyard Costs
(GAO/NSIAD-94-181, July 27, 1994). 

Partnerships:  Customer-Supplier Relationships Can Be Improved
Through Partnering (GAO/NSIAD-94-173, July 19, 1994). 

Commercial Practices:  DOD Could Reduce Electronics Inventories by
Using Private Sector Techniques (GAO/NSIAD-94-110, June 29, 1994). 

Defense Business Operations Fund:  Improved Pricing Practices and
Financial Reports Are Needed to Set Accurate Prices (GAO/AIMD-94-132,
June 22, 1994). 

Army Inventory:  Opportunities Exist for Additional Reductions to
Retail Level Inventories (GAO/NSIAD-94-129, June 6, 1994). 

Army Inventory:  More Effective Review of Proposed Inventory Buys
Could Reduce Unneeded Procurement (GAO/NSIAD-94-130, June 2, 1994). 

Army Inventory:  Changes to Stock Funding Repairables Would Save
Operations and Maintenance Funds (GAO/NSIAD-94-131, May 31, 1994). 

Air Force Logistics:  Improved Backorder Validation Procedures Will
Save Millions (GAO/NSIAD-94-103, Apr.  20, 1994). 

Defense Management Initiatives:  Limited Progress in Implementing
Management Improvement Initiatives (GAO/T-AIMD-94-105, Apr.  14,
1994). 

Commercial Practices:  Leading-Edge Practices Can Help DOD Better
Manage Clothing and Textile Stocks (GAO/NSIAD-94-64, Apr.  13, 1994). 

Defense Management:  Stronger Support Needed for Corporate
Information Management Initiative to Succeed (GAO/AIMD/NSIAD-94-101,
Apr.  12, 1994). 

Financial Management:  DOD's Efforts to Improve Operations of the
Defense Business Operations Fund (GAO/T-AIMD/NSIAD-94-146, Mar.  24,
1994). 

Defense Inventory:  Changes in DOD's Inventory Reporting, 1989-1992
(GAO/NSIAD-94-112, Feb.  10, 1994). 

Air Force Logistics:  Some Progress, But Further Efforts Needed to
Terminate Excess Orders (GAO/NSIAD-94-3, Oct.  13, 1993). 

Defense Inventory:  More Accurate Reporting Categories Are Needed
(GAO/NSIAD-93-31, Aug.  12, 1993). 

Defense Inventory:  Applying Commercial Purchasing Practices Should
Help Reduce Supply Costs (GAO/NSIAD-93-112, Aug.  6, 1993). 

Property Disposal:  DOD Is Handling Large Amounts of Excess Property
in Europe (GAO/NSIAD-93-195, July 30, 1993). 

Financial Management:  Opportunities to Strengthen Management of the
Defense Business Operations Fund (GAO/T-AFMD-93-6, June 16, 1993). 

Commercial Practices:  DOD Could Save Millions by Reducing
Maintenance and Repair Inventories (GAO/NSIAD-93-155, June 7, 1993). 

DOD Food Inventory:  Using Private Sector Practices Can Reduce Costs
and Eliminate Problems (GAO/NSIAD-93-110, June 4, 1993). 

Army Inventory:  Current Operating and War Reserve Requirements Can
Be Reduced (GAO/NSIAD-93-119, Apr.  14, 1993). 

Defense Inventory:  Defense Logistics Agency's Material Returns
Program (GAO/NSIAD-93-124, Mar.  30, 1993). 

Navy Supply:  Improved Backorder Management Will Reduce Material
Costs (GAO/NSIAD-93-131, Mar.  19, 1993). 

Financial Management:  Poor Internal Control Has Led to Increased
Maintenance Costs and Deterioration of Equipment (GAO/AFMD-93-8, Jan. 
25, 1993). 

Air Force Requirements:  Cost of Buying Aircraft Consumable Items Can
Be Reduced by Millions (GAO/NSIAD-93-38, Nov.  18, 1992). 

Defense Logistics Agency:  Why Retention of Unneeded Supplies
Persists (GAO/NSIAD-93-29, Nov.  4, 1992). 

Army Inventory:  Divisions' Authorized Levels of Demand-Based Items
Can Be Reduced (GAO/NSIAD-93-09, Oct.  20, 1992). 


1995 HIGH-RISK SERIES
============================================================ Chapter 5

An Overview (GAO/HR-95-1)

Quick Reference Guide (GAO/HR-95-2)

Defense Contract Management (GAO/HR-95-3)

Defense Weapons Systems Acquisition (GAO/HR-95-4)

Defense Inventory Management (GAO/HR-95-5)

Internal Revenue Service Receivables (GAO/HR-95-6)

Asset Forfeiture Programs (GAO/HR-95-7)

Medicare Claims (GAO/HR-95-8)

Farm Loan Programs (GAO/HR-95-9)

Student Financial Aid (GAO/HR-95-10)

Department of Housing and Urban Development (GAO/HR-95-11)

Superfund Program Management (GAO/HR-95-12)

The entire series of 12 high-risk reports can be ordered by using the
order number GAO/HR-95-20SET. 

