Subsequent to receiving agency comments and finalizing our report, we found that Office of Secretary of Defense officials amended the Financial Management Regulation to expand the reset cost categories within the procurement accounts of the Supplemental & Cost of War Execution Reports as of June 30, 2007. This action met the intent of our recommendation and should result in the Department of Defense providing Congress with greater visibility over funds appropriated for equipment replacement and recapitalization.
DOD did not concur with our recommendation, stating that there is no need to direct the services to assess their approaches to reset because the services already continually assess their approaches to equipment reset. However, the Army’s and Marine Corps’ implementation of their reset strategies do not necessarily address shortages of equipment in the short term. Instead, the Army’s implementation of its reset strategy is based on plans for repairing, recapitalizing, or replacing equipment returning from overseas theaters in a given fiscal year, while the Marine Corps’ implementation of its reset strategy is based on ensuring that Marine Corps units are equipped to perform both ongoing operations and other future missions. Based on GAO’s recent report (GAO-11-523) on Marine Corps equipment reset, and our on going review of Army equipment reset 351431, the two services have not reassessed or changed their approaches to equipment reset to ensure that their reset priorities address equipment short falls. The service’s approach continue to be focused on budgeting to reset equipment they anticipate will be return to the US, rather than minimizing the readiness and operational risk deploying and contingency forces.
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