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OSI/NSIAD-00-243R 1 (2000-08-24)

handle is hein.gao/gaobaallc0001 and id is 1 raw text is: ~G A 0 Accountabiity I Integry * Reliability United States General Accounting Office Office of Special Investigations Washington, DC 20548 B-285977 August 24, 2000 The Honorable Richard Durbin The Honorable Tom Harkin United States Senate The Honorable Peter DeFazio The Honorable Carolyn B. Maloney House of Representatives Subject: Defense Inventory: Status of Navy Initiatives to Improve Its In-Transit Inventory Process In response to your May 18, 2000, request, we are providing a status report on the Navy's initiatives to address, at least in part, a number of in-transit inventory problems that we identified in recent reports.! The information in this letter is based on what the Navy has reported to us as the specific actions it has taken to address the recommendations that we made in our March 1999 report. Concerns about the vulnerability of inventory shipments to fraud, waste, and abuse led the Congress to enact section 349 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 (P.L. 105-261), which requires the Department of Defense to develop a comprehensive plan for tracking inventory while it is being shipped. We are currently reviewing the Department of Defense's implementation of its department- wide plan to address in-transit inventory management problems and will be reporting on our findings this fall. Results In Brief In response to our recommendations, the Navy has reported a number of actions that, as specified below, are complete or in process. Overall, we are encouraged by the set of actions and believe that once they are fully implemented, short and long-term improvements in inventory management will result. We are particularly encouraged by the Navy's plan to reengineer its processes to create long-term system solutions. 'Department of the Navy: Breakdown of In-Transit Inventory Process Leaves It Vulnerable to Fraud (GAO/OSI/NSIAD-00-61, Feb. 2, 2000) and Defense Inventory: Navy's Procedures for Controlling In- Transit Items Are Not Being Followed (GAO/NSIAD-99-61, Mar. 31, 1999). GAO/OSI/NSIAD-00-243R Navy In-Transit Inventory Initiatives