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August 09, 2007

Whoops, a $265 million mistake

Jsf Lockheed Martin Aeronautics Co. says it discovered that it has overcharged the U.S. government by $265 million for work on the F-35 Joint Strike Fighter program and will promptly refund the money with interest.

In a statement released this morning the Fort Worth-based company said it had recently discovered "an inadvertent billing error." Actually, it appears to be the same error over and over. The company had erroneously billed the government in each of the 11 billing periods since the F-35 program launched in late 2001.

Lockheed said the error came in the way it processed invoices from the two major subcontractors, Northrop Grumman and BAE Systems, but that the error was not the fault of those two companies.

Lockheed said it is in discussions with the U.S. government to determine the appropriate amount of interest that should be paid and will repay the entire amount within a few days. The company said the matter should not have a material impact on Lockheed Martin Corp. financial condition or its performance.

More to come.

- Bob

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Comments

Robin

The bad part isn't that Lockheed overbilled the government, but that the government paid the bill.

Anonymous

Do you know anything about Defense Contract Auditing?

Then STFU.

I can't beleive Lockheed admitted their error.

Karn Duke

I'm surprised that anyone would be upset by someone returning money...?

Have you never made a mistake? Do you have any idea how many subcontracts and how much EV (earned value) calculations have to be made each month? Hundreds of people are involved just in trying to itemize the costs.

Also - Think of it another way - you go to McDonalds drive-up and order $4.00 worth of something and give the clerk a $10 bill. After you drive away, you discover that the clerk gave you $16 in change... Are you as honest as Lockheed Martin and would you go back and correct the mistake?
Also - why is their so much bad mouthing about the corporation that has consistantly provided the USA with the ultimate tools for air superiority? Remember the U2, the SR-71, the C-130, the C-141, the F-117, etc, etc.??

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