Appendix One Our audit approach

1  Our study examined whether the Ministry of Defence (the Department) optimises value for money (VFM) through its commercial and programme management arrangements for its equipment. We considered:

•  whether the Department is working with suppliers at the strategic level to improve the performance of its major equipment contracts;

•  whether the Department is following good practice in programme and supplier management in executing its major equipment programmes; and

•  whether the Department clearly defines what VFM looks like in equipment contracts and monitors VFM throughout the equipment lifecycle.

2  This report follows on from our report Defence Capabilities - delivering what was promised, which reported that programme senior responsible owners identified supplier performance as a major threat to delivery. Issues have persisted for decades and the Department has introduced many initiatives to improve commercial capability and engagement.

3  Our audit approach is summarised in Figure 9 on pages 57 and 58. Our evidence base is described in Appendix Two.