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National Defense: IR&D/B&P Cost Principle Revisions

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Report Type Reports and Testimonies
Report Date Dec. 23, 1992
Report No. NSIAD-93-99R
Subject
Summary:

Pursuant to a legislative requirement, GAO provided information on regulatory changes to Department of Defense contractors' allowable research and development costs. GAO noted that: (1) revisions to the independent research and development/bid and proposal (IR&D/B&P) cost principles were consistent with recent legislation; (2) the regulatory changes increased contractors' maximum allowable IR&D/B&P costs and helped reduce contract cost misclassification; (3) because of potentially large increases in contractor research and development costs, close oversight and impact assessments will be needed to control IR&D/B&P costs; (4) the Defense Contract Audit Agency will continue to provide financial information on contractor IR&D/B&P expenditures and reimbursements; and (5) the Office of Technology Assessment will report on whether the regulatory changes are encouraging greater contractor research and development investment.

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