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Reporting of Inventory Categories and Strata

Data representing the dollar value of inventories in the aggregate supply system, both the items which are financed by stock funds and those financed by appropriated funds, are shown for each of the military services and the Defense Supply Agency (stock fund only) in the numbered tables

in this section.

Each of these tables shows the dollar amount of inventories in each major commodity category (groupings of similar kinds of supplies and equipment as reported by the services) and in each stratum (groupings according to the purpose for which the supplies are retained).

The stratification accounts in use by the services and DSA are uniformly prescribed by DOD Instruction 4140.18, and are (1) Approved Force Acquisition, (2) Approved Force Retention, (3) Economic Retention, (4) Contingency Retention, (5) Allied Force Retention, and (6) Potential Excess Stocks. These inventory accounts are defined as follows:

a. Approved Force Acquisition Stock is the value of assets allocated to the Approved Force Acquisition Objective, which is the quantity of an item authorized for peacetime acquisition to equip and sustain the U. S. Approved Force in peacetime and in wartime for the period and at the level of support prescribed by the latest logistics guidance issued by the Secretary of Defense. Stocks in this stratum held by one service are not required to be transferred to another service without reimbursement, all other strata are subject to transfer without reimbursement.

but

b. Approved Force Retention Stock is the value of the assets allocated to the Approved Force Retention Level, which is the quantity, in addition to the Approved Force Acquisition Objective, that is required

to equip and sustain the Approved Forces from D-Day until production equals the rate at which the item is required.

C. Economic Retention Stock is that value of assets excess

to the Approved Force Retention Level which it has been determined

will be more economical to retain for future issue than to replenish by procurement.

d.

Contingency Retention Stock is that value of assets excess

to the Approved Force Retention Level which normally would be allocated to Potential DOD Excess but which, it has been determined, will be retained for possible contingencies for U. S. Forces.

e. Allied Force Retention Stock is that value of an item excess

to the U. S. Approved Force Retention Level which is required to equip and sustain Specified Allied Forces to the degree and at the rate

approved by the Secretary of Defense.

f. Potential DOD Excess Stock is that value of an item above

all authorized retention levels of the reporting DOD component which is in process of screening for utilization, but for which final determination as DOD excess has not been made.

In addition to the stratified stocks shown above, the tables that follow show Undelivered MAP, which represents the value of assets for which military assistance grant aid orders have been received, but for which constructive delivery to the Military Assistance Program has not been made. Also shown, are unstratified stocks consisting of in transit stock, stocks in hands of contractors, and other stocks that are, for the time being, unstratified for some reason.

In transit stock is that owned by a DOD component, which is enroute

(1) from manufacturers or suppliers; (2) from United States depots to overseas commands or vice versa; (3) from United States depots to United States commands or vice versa; and (4) between United States depots; and which has not been received by the consignee. Accounting systems of reporting components may not always reveal these in transit or other stocks separately; instead these stocks may be stratified as appropriate by the DOD component.

2. Summary of Department of Defense Supply System Inventories (Tables 31 and 32)

During fiscal year 1966 the reported value of the military supply system inventories was increased by $675 million dollars from $36,986 million to $37,661 million, inclusive of shipboard supplies. As has been stated, increased coverage of groups of items never before reported in these tables account for an increase in value of $1,091 million so that the real change in the value of the supply inventories reported at 30 June 1965 is a decrease of $416 million, bringing the value of those same inventories to $36,570 million. The inventories shown include those of the Army, Navy, Marine Corps, Air Force, and DSA, and do not include the supplies of OSD and other Defense agencies which are carried in Tables 1 and 2 at a value of $67 million.

In the totals shown here, the increase amounted to less than 2 percent. Stock-funded inventories increased $523 million (almost 10

percent

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this includes no added coverage) and appropriation-financed inventories increased $152 million (one-half of one percent, including the additional coverage).

The net increase in stock fund inventories of the Department of

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1/ Includes $494 million of Shipboard Supplies not included in Navy Supply System inventory data shown in Table 32.

71-275 067-9

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Table 32 Supply System Inventories (Including Stock Funds)

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as of 30 June 1966

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1/ Excludes excess stocks for which disposal has been authorized or initiated. These are shown in Table 45.

2/ Includes stocks in transit, stocks in hands of contractors, stocks temporarily in use, and other inventories that are not, as of the date of this report, stratified by each reporting component according to its accounting practice.

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