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ON AUDITS OF DEFENSE CONTRACTS

HEARINGS

BEFORE A

SUBCOMMITTEE OF THE

COMMITTEE ON

GOVERNMENT OPERATIONS
HOUSE OF REPRESENTATIVES

EIGHTY-NINTH CONGRESS

FIRST SESSION

MAY 10, 11, 18, 19, 20, 25, 26, 27; JUNE 1, 3; AND JULY 8, 1965

Printed for the use of the

Committee on Government Operations

48-132

U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON: 1965

For sale by the Superintendent of Documents, U.S. Government Printing Office
Washington, D.C., 20402 Price $3.25

-

47 92ST

XL2

03/94 53-005-00

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COMMITTEE ON GOVERNMENT OPERATIONS

WILLIAM L. DAWSON, Illinois, Chairman

CHET HOLIFIELD, California
JACK BROOKS, Texas

L. H. FOUNTAIN, North Carolina
PORTER HARDY, JR., Virginia
JOHN A. BLATNIK, Minnesota
ROBERT E. JONES, Alabama
EDWARD A. GARMATZ, Maryland
JOHN E. MOSS, California
DANTE B. FASCELL, Florida
HENRY S. REUSS, Wisconsin
JOHN S. MONAGAN, Connecticut
TORBERT H. MACDONALD, Massachusetts
J. EDWARD ROUSH, Indiana
WILLIAM S. MOORHEAD, Pennsylvania
CORNELIUS E. GALLAGHER, New Jersey
WILLIAM J. RANDALL, Missouri

BENJAMIN S. ROSENTHAL, New York
JIM WRIGHT, Texas

FERNAND J. ST GERMAIN, Rhode Island
DAVID S. KING, Utah

JOHN G. DOW, New York

HENRY HELSTOSKI, New Jersey

CLARENCE J. BROWN, Ohio
FLORENCE P. DWYER, New Jersey
KOBERT P. GRIFFIN, Michigan
OGDEN R. REID, New York
FRANK J. HORTON, New York
DELBERT L. LATTA, Ohio
DONALD RUMSFELD, Illinois
WILLIAM L. DICKINSON, Alabama
JOHN N. ERLENBORN, Illinois
HOWARD H. CALLAWAY, Georgia
JOHN W. WYDLER, New York

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CONTENTS

Carr, John F., general counsel, Grumman Aircraft Engineering Corp.;

accompanied by Patrick J. Cherry, comptroller___

Charles, Robert H., Assistant Secretary of the Air Force (Installations
and Logistics); accompanied by William Munves, Assistant General
Counsel for Procurement; Aaron J. Racusin, Deputy for Procure-
ment Management; Dale R. Babione, Assistant Deputy (Procure-
ment); and Frank S. Howell, Assistant Auditor General for
Contract Audits__.

Derr, Charles I., senior vice president, Machinery & Allied Products
Institute; accompanied by William J. Healey, Jr., staff counsel._ _ _
Douglas, John W., Assistant Attorney General, Civil Division, Depart-
ment of Justice..

Hannah, Paul F., Esq--

Harr, Karl G., president, Aerospace Industries, Inc.; accompanied
by Morton Wilner, general counsel..

Haughton, Daniel J., president, Lockheed Aircraft Corp.; accom-
panied by John E. Cavanagh, counsel, Lockheed Missiles & Space
Co____

Heflin, William H., president, Western Electronic Manufacturers

Association; accompanied by E. E. Ferrey, executive vice president;

and Neil D. Naiden, special counsel..

Horner, H. M., chairman, United Aircraft Corp.; accompanied by
C. B. Preston, assistant controller; and R. E. Beach, vice president
and corporation counsel..

275

240

363

491

88

538

410

446

425

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