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ON AUDITS OF DEFENSE CONTRACTS

HEARINGS

BEFORE A

SUBCOMMITTEE OF THE
!. C. Corry sa His. COMMITTEE ON

GOVERNMENT OPERATIONS. Milton
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

U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 1965

48-132

For sale by the Superintendent of Documents, U.S. Government Printing Office

Washington, D.C., 20402 - Price $3.25

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G668

Copya

COMMITTEE ON GOVERNMENT OPERATIONS

WILLIAM L. DAWSON, Illinois, Chairman CHET HOLIFIELD, California

CLARENCE J. BROWN, Ohio JACK BROOKS, Texas

FLORENCE P. DWYER, New Jersey L. H. FOUNTAIN, North Carolina

KOBERT P. GRIFFIN, Michigan PORTER HARDY, JR., Virginia

OGDEN R. REID, New York JOHN A. BLATNIK, Minnesota

FRANK J. HORTON, New York ROBERT E. JONES, Alabama

DELBERT L. LATTA, Ohio EDWARD A. GARMATZ, Maryland

DONALD RUMSFELD, Illinois JOHN E. MOSS, California

WILLIAM L. DICKINSON, Alabama DANTE B. FASCELL, Florida

JOHN N. ERLENBORN, Illinois HENRY S. REUSS, Wisconsin

HOWARD H. CALLAWAY, Georgia
JOHN S. MONAGAN, Connecticut

JOHN W. WYDLER, New York
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

CHRISTINE RAY Davis, Staff Director

JAMES A. LANIGAN, General Counsel
MILES Q. ROMNEY, Associate General Counsel

J. P. CARLSON, Minority Counsel
RAYMOND T. COLLINS, Minority Professional Staff

MILITARY OPERATIONS SUBCOMMITTEE

CHET HOLIFIELD, California, Chairman EDWARD A. GARMATZ, Maryland

FRANK J. HORTON, New York
WILLIAM S. MOORHEAD, Pennsylvania DELBERT L. LATTA, Ohio
WILLIAM J. RANDALL, Missouri

HOWARD H. CALLAWAY, Georgia
JIM WRIGHT, Texas
FERNAND J. ST GERMAIN, Rhode Island

HERBERT ROBACK, Staff Administrator

PAUL RIDGELY, Investigator
ROBERT J. MCELROY, Investigator
DOUGLAS G. DAHLIN, Attorney

DANIEL W. FULMER, Attorney

CATHERINE KOEBERLEIN, Research Analyst
II

CONTENTS

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Hearings held in Washington, D.C., on-

Monday, May 10, 1965.

Tuesday, May 11, 1965-

Tuesday, May 18, 1965-

Wednesday, May 19, 1965.

Thursday, May 20, 1965..

Tuesday, May 25, 1965-

Wednesday, May 26, 1965.

Thursday, May 27, 1965-

Tuesday, June 1, 1965.
Thursday, June 3, 1965.

Thursday, July 8, 1965.

Statement of

Abbadessa, John P., Controller, Atomic Energy Commission; ac-

companied by Joseph L. Smith, Director, Division of Contracts;

Joseph P. Gerdes, Assistant Controller for Auditing; and William

J. Minsch, Jr., Assistant General Counsel -.--

Bannerman, Graeme C., Assistant Secretary of the Navy (Instal-

lations and Logistics); accompanied by M. Eugene Jones, Director
of Procurement; John Phelan, Deputy General Counsel; and

George W. Markey, Office of General Counsel ---

Barnes, Kendall M., General Counsel, Army Materiel Command.

Campbell, Hon. Joseph, Comptroller General of the United States;

accompanied by Robert F. Keller, General Counsel, General

Accounting Office; William A. Newman, Jr., Director; and Charles

M. Bailey, Deputy Director, Defense Accounting and Audit Di-

vision:

May 11, 1965.

May 19, 1965 --

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.

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