Fort Worth Branch Supports Oversight of F-35 Block 4 Modernization Program

Fort Worth Branch Supports Oversight of F-35 Block 4 Modernization Program

By DCAA Staff Writer

The Defense Contract Audit Agency's Forth Worth Branch office (FWBO) is playing a key role in supporting oversight and negotiations for the F-35 Block 4 modernization program, one of the largest defense modernization efforts currently underway.

The Block 4 program includes more than 70 hardware and software upgrades to improve the capabilities of both in-service and newly produced F-35 aircraft. By total dollar value, it is the second-largest F-35 program under the Joint Program Office (JPO) buying command.

During its audit work, The FWBO identified significant upward adjustments and overstatements in proposed material costs. While the contractor asserted that historical costs were used to develop estimates, FWBO analysis found portions of the proposal contained upward adjustments that had been applied to the historical cost data.

Using its direct access to actual contractor cost information, FWBO validated costs in the contractor's systems and removed unwarranted upward adjustments that had been applied by the contractor. The resulting advisory service memorandum will strengthen the government's negotiating position and help protect the government from paying the contractor for costs that are not incurred.

The FWBO also provided critical continuity and negotiation support to JPO throughout the proposal process. After identifying the material overstatements, FWBO auditors coordinated with the Customer Support Representative to brief JPO leadership on the findings. Since issuing the report and the briefing, the branch office has remained actively engaged in negotiations, continuing to provide audit expertise and financial oversight in support of the Department of War mission.