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entitled 'Information on Federal Contractors That Are Incorporated 
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GAO-03-194R: 

United States General Accounting Office: 
Washington, DC 20548: 

October 1, 2002: 

The Honorable Henry A. Waxman: 
Ranking Minority Member: 
Committee on Government Reform: 
House of Representatives: 

The Honorable Jim Turner: 
Ranking Minority Member: 
Subcommittee on Technology and Procurement Policy: 
Committee on Government Reform: 
House of Representatives: 

Subject: Information on Federal Contractors That Are Incorporated 
Offshore: 

Some U.S.-based multinational companies have found that the effective 
tax rate on income earned from foreign sources can be reduced if they 
are incorporated in countries that either do not tax corporate income 
at all or tax the income at a lower rate than the U.S. corporate tax 
rate. Consequently, some U.S.-based companies incorporate from the 
outset in these so-called "tax haven" countries.[Footnote 1] In 
addition, some companies that were incorporated in the United States 
have reincorporated in tax haven countries through "corporate 
inversion transactions." 

According to the Department of the Treasury, the term "inversion" is 
used to describe a broad category of transactions through which a U.S.-
based multinational company restructures its corporate group so that 
after the transaction the ultimate parent of the corporate group is a 
foreign corporation.[Footnote 2] Generally, after an inversion 
transaction, shareholders of the former U.S. parent company hold stock 
of the newly formed foreign parent, and the operations of the company 
are unchanged. Treasury also noted that there has been a marked 
increase recently in the frequency, size, and profile of inversion 
transactions. This year, several bills have been introduced in 
Congress that address such transactions. 

You asked us for information on the extent to which large federal 
contractors are incorporated offshore. In response, we agreed to 
determine which, if any, of the largest 100 publicly traded federal 
contractors are incorporated in a tax haven country or have engaged in 
a transaction characterized by independent observers as an inversion. 

We used the General Services Administration's listing of top federal 
contractors to identify (1) the top 100 federal contractors that are 
publicly traded corporations and (2) the total dollar amount that was 
obligated in fiscal year 2001. We reviewed various public documents 
filed by the corporations with the Securities and Exchange Commission 
(SEC) on its Electronic Data Gathering, Analysis, and Retrieval 
(EDGAR) system to identify the state or country where the contractor 
is incorporated. When the data we needed to do our analysis were not 
available on EDGAR, we obtained our information from the corporations' 
Web sites and from published reports. To determine whether a country 
is considered a tax haven, we made reference to the work the 
Organization for Economic Cooperation and Development did on tax haven 
countries.[Footnote 3] Finally, to determine whether a transaction has 
been characterized as an inversion, we reviewed the corporations' SEC 
filings and reports published by organizations, including 
Congressional Research Service and the New York State Bar Association 
Tax Section. We did our work in August and September 2002 in 
accordance with generally accepted government auditing standards. 

Results: 

Four of the top 100 federal contractors that are publicly traded 
corporations are incorporated in a tax haven country. Table 1 lists 
the four corporations, the dollar amount of their federal contract 
obligations in fiscal year 2001, the country where they are 
incorporated, and the year of incorporation. 

Table 1: Federal Contractors, out of the Top 100 Publicly Traded 
Federal Contractors, Incorporated in a Tax Haven Country: 
			
Name of corporation: McDermott International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands): 
$1,885,243; 
Incorporation location: Panama; 
Incorporation date: 1983. 

Name of corporation: Foster Wheeler, Ltd. 
Federal contract obligations FY 2001 (dollars in thousands): $286,298; 
Incorporation location: Bermuda; 
Incorporation date: 2001. 

Name of corporation: Accenture, Ltd. 
Federal contract obligations FY 2001 (dollars in thousands): $278,990; 
Incorporation location: Bermuda; 
Incorporation date: 2001. 

Name of corporation: Tyco International, Ltd. 
Federal contract obligations FY 2001 (dollars in thousands): $206,387; 
Incorporation location: Bermuda; 
Incorporation date: 1997. 

Source: GAO analysis of General Services Administration contract data 
and SEC records. 

[End of table] 

The four corporations accounted for about $2.7 billion for contract 
obligations in fiscal year 2001, which is about 2.6 percent of the 
$102 billion in federal contract obligations awarded to the top 100 
publicly traded corporations. (See enclosure I for a list of the top 
100 publicly traded federal contractors.) 

Three of the four corporations (McDermott International, Inc., Foster 
Wheeler, Ltd., and Tyco International, Ltd.) have engaged in 
transactions that have been characterized as inversions.[Footnote 4] 
The enclosure provides more information on how the four corporations 
became incorporated offshore. 

We are sending copies of this letter to the Chairman of the House 
Committee on Government Reform and the Chairman of the Subcommittee on 
Technology and Procurement Policy of the House Committee on Government 
Reform; the Chairmen and Ranking Minority Members of the House 
Committee on Ways and Means and the Senate Committee on Finance; and 
other interested parties. We will also make copies available to others 
upon request. In addition, this letter will be available at no charge 
on the GAO Web site at [hyperlink, http://www.gao.gov]. 

If you or your staff have any questions, please contact me on (202) 
512-9110 or Ralph Block on (415) 904-2150. 

Signed by: 

James R. White Director, Tax Issues: 

Enclosure: 

[End of section] 

Enclosure: Information on Corporations Receiving Federal Contracts and 
Those That Are Incorporated Offshore: 

The following table lists the top 100 federal contractors that are 
publicly owned corporations, the dollar amount of their fiscal year 
2001 federal contracts, the state or country where they are 
incorporated, and the year of incorporation. 

Table 2: Top 100 Publicly Traded Federal Contractors: 
				
Rank: 1; 
Company name: Lockheed Martin Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$17,951,303; 
Incorporation location: Maryland; 
Incorporation date: 1995. 

Rank: 2; 
Company name: The Boeing Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$14,362,243; 
Incorporation location: Delaware; 
Incorporation date: 1916. 

Rank: 3; 
Company name: Raytheon Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$6,123,605; 
Incorporation location: Delaware; 
Incorporation date: 1998. 

Rank: 4; 
Company name: Newport News Shipbuilding, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$5,689,359; 
Incorporation location: Delaware; 
Incorporation date: 1996. 

Rank: 5; 
Company name: Northrop Grumman Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$5,636,124; 
Incorporation location: Delaware; 
Incorporation date: 1985. 

Rank: 6; 
Company name: General Dynamics Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$4,928,238; 
Incorporation location: Delaware; 
Incorporation date: 1952. 

Rank: 7; 
Company name: United Technologies Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$3,500,465; 
Incorporation location: Delaware; 
Incorporation date: 1934. 

Rank: 8; 
Company name: Science Applications International Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$2,654,492; 
Incorporation location: Delaware; 
Incorporation date: 1984. 

Rank: 9; 
Company name: TRW, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$2,499,816; 
Incorporation location: Ohio; 
Incorporation date: 1916. 

Rank: 10; 
Company name: AmerisourceBergen Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$1,900,969; 
Incorporation location: Delaware; 
Incorporation date: 2001. 

Rank: 11; 
Company name: McDermott International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$1,885,243; 
Incorporation location: Panama; 
Incorporation date: 1983. 

Rank: 12; 
Company name: General Electric Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$1,808,984; 
Incorporation location: New York; 
Incorporation date: 1892. 

Rank: 13; 
Company name: American Management Systems, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$1,675,676; 
Incorporation location: Delaware; 
Incorporation date: 1970. 

Rank: 14; 
Company name: Computer Sciences Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$1,648,495; 
Incorporation location: Nevada; 
Incorporation date: 1959. 

Rank: 15; 
Company name: Honeywell International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$1,442,018; 
Incorporation location: Delaware; 
Incorporation date: 1985. 

Rank: 16; 
Company name: BAE Systems, plc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$972,526; 
Incorporation location: United Kingdom; 
Incorporation date: 1977. 

Rank: 17; 
Company name: Health Net, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$944,618; 
Incorporation location: Delaware; 
Incorporation date: 1990. 

Rank: 18; 
Company name: Fluor Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$931,885; 
Incorporation location: Delaware; 
Incorporation date: 2000. 

Rank: 19; 
Company name: ITT Industries, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$879,772; 
Incorporation location: Indiana; 
Incorporation date: 1995. 

Rank: 20; 
Company name: Alliant Techsystems, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$862,269; 
Incorporation location: Delaware; 
Incorporation date: 1990. 

Rank: 21; 
Company name: Exxon Mobil Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$707,283; 
Incorporation location: New Jersey; 
Incorporation date: 1882. 

Rank: 22; 
Company name: The IT Group, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$671,977; 
Incorporation location: Delaware; 
Incorporation date: 1987. 

Rank: 23; 
Company name: Philipp Holzmann AG; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$655,360; 
Incorporation location: Germany; 
Incorporation date: 1849. 

Rank: 24; 
Company name: Textron, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$600,533; 
Incorporation location: Delaware; 
Incorporation date: 1967. 

Rank: 25; 
Company name: Oshkosh Truck Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$566,511; 
Incorporation location: Wisconsin; 
Incorporation date: 1917. 

Rank: 26; 
Company name: Electronic Data Systems Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$560,767; 
Incorporation location: Delaware; 
Incorporation date: 1994. 

Rank: 27; 
Company name: Motorola, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$552,520; 
Incorporation location: Delaware; 
Incorporation date: 1947. 

Rank: 28; 
Company name: Unisys Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$549,905; 
Incorporation location: Delaware; 
Incorporation date: 1999. 

Rank: 29; 
Company name: Jacobs Engineering Group, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$536,130; 
Incorporation location: Delaware; 
Incorporation date: 1987. 

Rank: 30; 
Company name: Halliburton Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$534,177; 
Incorporation location: Delaware; 
Incorporation date: 1924. 

Rank: 31; 
Company name: Washington Group International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$531,234; 
Incorporation location: Delaware; 
Incorporation date: 1993. 

Rank: 32; 
Company name: WorldCom, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$503,811; 
Incorporation location: Georgia; 
Incorporation date: 1983. 

Rank: 33; 
Company name: International Business Machines Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$498,656; 
Incorporation location: New York; 
Incorporation date: 1911. 

Rank: 34; 
Company name: Dell Computer Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$493,423; 
Incorporation location: Delaware; 
Incorporation date: 1987. 

Rank: 35; 
Company name: L-3 Communications Holdings, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$482,248; 
Incorporation location: Delaware; 
Incorporation date: 1997. 

Rank: 36; 
Company name: BP, plc; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$480,858; 
Incorporation location: United Kingdom; 
Incorporation date: 1998. 

Rank: 37; 
Company name: Affiliated Computer Services, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$451,067; 
Incorporation location: Delaware; 
Incorporation date: 2001. 

Rank: 38; 
Company name: DaimlerChrysler AG; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$435,921; 
Incorporation location: Germany; 
Incorporation date: 1998. 

Rank: 39; 
Company name: The Titan Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$424,087; 
Incorporation location: Delaware; 
Incorporation date: 1986. 

Rank: 40; 
Company name: Cardinal Health, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$422,120; 
Incorporation location: Ohio; 
Incorporation date: 1979. 

Rank: 41; 
Company name: Anteon International Corporation[B]; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$406,304; 
Incorporation location: Delaware; 
Incorporation date: 1996. 

Rank: 42; 
Company name: GTSI Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$402,408; 
Incorporation location: Delaware; 
Incorporation date: 1983. 

Rank: 43; 
Company name: AT&T Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$398,326; 
Incorporation location: New York; 
Incorporation date: 1885. 

Rank: 44; 
Company name: Humana, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$394,135; 
Incorporation location: Delaware; 
Incorporation date: 1964. 

Rank: 45; 
Company name: Harris Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$389,970; 
Incorporation location: Delaware; 
Incorporation date: 1926. 

Rank: 46; 
Company name: CACI International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$380,524; 
Incorporation location: Delaware; 
Incorporation date: 1985. 

Rank: 47; 
Company name: Rockwell International Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$372,131; 
Incorporation location: Delaware; 
Incorporation date: 1996. 

Rank: 48; 
Company name: The Wackenhut Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$356,968; 
Incorporation location: Florida; 
Incorporation date: 1958. 

Rank: 49; 
Company name: Rolls-Royce, plc; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$327,792; 
Incorporation location: United Kingdom; 
Incorporation date: 1906. 

Rank: 50; 
Company name: Engineered Support Systems, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$321,384; 
Incorporation location: Missouri; 
Incorporation date: 1981. 

Rank: 51; 
Company name: Valero Energy Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$310,202; 
Incorporation location: Delaware; 
Incorporation date: 1981. 

Rank: 52; 
Company name: Goodrich Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$308,283; 
Incorporation location: New York; 
Incorporation date: 1912. 

Rank: 53; 
Company name: Johnson Controls, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$299,592; 
Incorporation location: Wisconsin; 
Incorporation date: 1900. 

Rank: 54; 
Company name: CNF, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$295,113; 
Incorporation location: Delaware; 
Incorporation date: 1958. 

Rank: 55; 
Company name: Anthem, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$293,153; 
Incorporation location: Indiana; 
Incorporation date: 2001. 

Rank: 56; 
Company name: ManTech International Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$291,513; 
Incorporation location: New Jersey; 
Incorporation date: 1968. 

Rank: 57; 
Company name: Foster Wheeler, Ltd. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$286,298; 
Incorporation location: Bermuda; 
Incorporation date: 2001. 

Rank: 58; 
Company name: Accenture, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$278,990; 
Incorporation location: Bermuda; 
Incorporation date: 2001. 

Rank: 59; 
Company name: URS Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$262,489; 
Incorporation location: Delaware; 
Incorporation date: 1991. 

Rank: 60; 
Company name: SRA International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$234,926; 
Incorporation location: Delaware; 
Incorporation date: 1984. 

Rank: 61; 
Company name: Rockwell Collins, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$234,075; 
Incorporation location: Delaware; 
Incorporation date: 2001. 

Rank: 62; 
Company name: The Procter and Gamble Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$224,212; 
Incorporation location: Ohio; 
Incorporation date: 1837. 

Rank: 63; 
Company name: General Motors Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$222,440; 
Incorporation location: Delaware; 
Incorporation date: 1916. 

Rank: 64; 
Company name: FedEx Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$214,907; 
Incorporation location: Delaware; 
Incorporation date: 1997. 

Rank: 65; 
Company name: Oracle Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$212,468; 
Incorporation location: Delaware; 
Incorporation date: 1986. 

Rank: 66; 
Company name: Tetra Tech, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$211,705; 
Incorporation location: Delaware; 
Incorporation date: 1988. 

Rank: 67; 
Company name: Verizon Communications, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$207,210; 
Incorporation location: Delaware; 
Incorporation date: 1983. 

Rank: 68; 
Company name: Tyco International, Ltd. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$206,387; 
Incorporation location: Bermuda; 
Incorporation date: 1997. 

Rank: 69; 
Company name: Motor Oil (Hellas) Corinth Refineries S.A. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$199,462; 
Incorporation location: Greece; 
Incorporation date: 1970. 

Rank: 70; 
Company name: Archer Daniels Midland Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$189,876; 
Incorporation location: Delaware; 
Incorporation date: 1923. 

Rank: 71; 
Company name: Veridian Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$188,960; 
Incorporation location: Delaware; 
Incorporation date: 1986. 

Rank: 72; 
Company name: Smiths Group, plc; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$184,232; 
Incorporation location: United Kingdom; 
Incorporation date: 2000. 

Rank: 73; 
Company name: Ford Motor Company; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$179,126; 
Incorporation location: Delaware; 
Incorporation date: 1919. 

Rank: 74; 
Company name: Texas Instruments, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$178,631; 
Incorporation location: Delaware; 
Incorporation date: 1938. 

Rank: 75; 
Company name: Computer Associates International; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$172,202; 
Incorporation location: Delaware; 
Incorporation date: 1974. 

Rank: 76; 
Company name: United Industrial Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$171,044; 
Incorporation location: Delaware; 
Incorporation date: 1959. 

Rank: 77; 
Company name: Orbital Sciences Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$161,286; 
Incorporation location: Delaware; 
Incorporation date: 1987. 

Rank: 78; 
Company name: Ball Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$153,613; 
Incorporation location: Indiana; 
Incorporation date: 1922. 

Rank: 79; 
Company name: Parker-Hannifin Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$153,562; 
Incorporation location: Ohio; 
Incorporation date: 1938. 

Rank: 80; 
Company name: Philip Morris Companies, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$149,634; 
Incorporation location: Virginia; 
Incorporation date: 1919. 

Rank: 81; 
Company name: Xerox Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$139,224; 
Incorporation location: New York; 
Incorporation date: 1906. 

Rank: 82; 
Company name: Sprint Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$136,200; 
Incorporation location: Kansas; 
Incorporation date: 1938. 

Rank: 83; 
Company name: ConAgra Foods, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$131,850; 
Incorporation location: Delaware; 
Incorporation date: 1975. 

Rank: 84; 
Company name: GenCorp, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$131,848; 
Incorporation location: Ohio; 
Incorporation date: 1915. 

Rank: 85; 
Company name: Siemens AG; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$124,452; 
Incorporation location: Germany; 
Incorporation date: 1966. 

Rank: 86; 
Company name: Roy F. Weston, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$124,380; 
Incorporation location: Pennsylvania; 
Incorporation date: 1957. 

Rank: 87; 
Company name: Holly Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$121,831; 
Incorporation location: Delaware; 
Incorporation date: 1947. 

Rank: 88; 
Company name: McKesson Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$121,526; 
Incorporation location: Delaware; 
Incorporation date: 1994. 

Rank: 89; 
Company name: Telos Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$118,803; 
Incorporation location: Maryland; 
Incorporation date: 1972. 

Rank: 90; 
Company name: KPMG Consulting, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$117,456; 
Incorporation location: Delaware; 
Incorporation date: 1999. 

Rank: 91; 
Company name: Cubic Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$117,054; 
Incorporation location: Delaware; 
Incorporation date: 1984. 

Rank: 92; 
Company name: PC Connection, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$116,919; 
Incorporation location: Delaware; 
Incorporation date: 1997. 

Rank: 93; 
Company name: DRS Technologies, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$116,395; 
Incorporation location: Delaware; 
Incorporation date: 1968. 

Rank: 94; 
Company name: Avaya, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$115,079; 
Incorporation location: Delaware; 
Incorporation date: 2000. 

Rank: 95; 
Company name: Hillenbrand Industries, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$114,456; 
Incorporation location: Indiana; 
Incorporation date: 1969. 

Rank: 96; 
Company name: Furniture Brands International, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$112,395; 
Incorporation location: Delaware; 
Incorporation date: 1921. 

Rank: 97; 
Company name: Berkshire Hathaway, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$111,993; 
Incorporation location: Delaware; 
Incorporation date: 1973. 

Rank: 98; 
Company name: Lucent Technologies, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$107,402; 
Incorporation location: Delaware; 
Incorporation date: 1995. 

Rank: 99; 
Company name: WGL Holdings, Inc. 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$105,260; 
Incorporation location: Virginia; 
Incorporation date: 2000. 

Rank: 100; 
Company name: Olin Corporation; 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$104,121; 
Incorporation location: Virginia; 
Incorporation date: 1892. 

Total: 
Federal contract obligations FY 2001 (dollars in thousands)[A]: 
$101,770,865. 

[A] Contract obligations include contracts with subsidiaries. 
According to a General Services Administration (GSA) official, GSA 
follows a multi-step process (that includes using Dun & Bradstreet 
assigned D-U-N-S numbers, company names, and company affiliations) to 
aggregate federal contracts by company. We did not verify GSA's 
federal contractors listing for accuracy or completeness. 

[B] Formerly Azimuth Technologies, Inc. 

Source: General Services Administration, Securities and Exchange 
Commission, and GAO Internet research. 

[End of table] 

Four of the top 100 federal contractors that are publicly traded 
corporations are incorporated in a tax haven country. Information on 
when these four corporations (McDermott International, Inc., Foster 
Wheeler, Ltd., Accenture, Ltd., and Tyco International, Ltd.) were 
incorporated in a tax haven country is discussed below. 

McDermott International, Inc.: With over $1.8 billion in federal 
contract obligations in fiscal year 2001, McDermott International was 
the 11th largest publicly traded federal contractor. Almost three-
quarters of the contracts awarded to McDermott International, Inc. and 
its subsidiaries and their joint ventures were with the Department of 
Energy (DOE). Most of the contract amounts were for providing 
facilities support services at Department of Energy facilities in Oak 
Ridge, Tenn., and Albuquerque, N. Mex. Other Energy Department 
contracts were for work related to nuclear reactors, hazardous waste 
clean up and Strategic Petroleum Reserve operations. 

McDermott International's filings with the SEC and McDermott 
International's Web site did not contain information on the 
circumstances surrounding its incorporation in Panama. However, a May 
2002 report by the New York State Bar Association provides some 
background on how McDermott Incorporated, a U.S.-based corporation, 
exchanged shares with McDermott International to become a Panama-based 
corporation.[Footnote 5] McDermott Incorporated, which was 
incorporated in Delaware in 1946, had a Panamanian subsidiary, 
McDermott International. In 1983, shareholders of McDermott 
Incorporated exchanged their shares for McDermott International shares. 

Foster Wheeler, Ltd.: With over $280 million in federal contract 
obligations in fiscal year 2001, Foster Wheeler, Ltd., was the 57th 
largest publicly traded federal contractor. Sixty-two percent of 
Foster Wheeler contracts were with the Department of Defense, with 
another 34 percent held by the Department of Energy. Fifty-three 
percent of the contract dollars were for hazardous waste cleanup or 
other environmental services, with another one-third for facilities 
maintenance or construction. 

According to filings with the SEC, the Foster Wheeler Corporation was 
originally incorporated in New York in 1900 and reorganized to become 
a Bermuda corporation in 2001. In order to accomplish its change in 
domicile, it established a new subsidiary, Foster Wheeler, Ltd., based 
in Bermuda and wholly owned by Foster Wheeler Corporation. Foster 
Wheeler, Ltd., indirectly owned another company, Foster Wheeler LLC, a 
Delaware company. On May 25, 2001, Foster Wheeler LLC became the 
surviving entity of a merger with Foster Wheeler Corporation. Because 
Foster Wheeler LLC was already a subsidiary of Foster Wheeler, Ltd., 
the Bermuda corporation became the new parent company. All shares in 
the Foster Wheeler Corporation were converted into shares of Foster 
Wheeler, Ltd. According to the prospectus to shareholders filed with 
the SEC, the Foster Wheeler Corporation made this transaction to have 
a more favorable regulatory environment, attract non-US investors, 
improve their worldwide effective tax rate, and provide for greater 
flexibility to restructure. 

Accenture, Ltd.: With about $280 million in federal contract 
obligations, Accenture was the 58th largest publicly traded federal 
contractor in fiscal year 2001. Accenture contracted with many 
departments of the government, but about 43 percent of its contracts 
were with the Department of Defense. About 98 percent of Accenture's 
contract dollars are for automatic data processing and 
telecommunications services and equipment. 

According to SEC filings, Accenture, Ltd. was incorporated in Bermuda 
in 2001. The company was formerly associated with Arthur Anderson and 
Andersen Worldwide. Prior to incorporating in Bermuda, Accenture was 
operating as a series of related partnerships and corporations under 
the control of its partners through the mechanism of contracts with a 
Swiss coordinating entity. In April 2001, Accenture's partners voted 
to pursue an initial public offering. According to the prospectus 
filed with the SEC, the partners were to generally exchange all of 
their interests in these partnerships and corporations for Accenture 
stock. 

Tyco International, Ltd.: With over $200 million in federal contract 
obligations, Tyco International was the 68th largest publicly traded 
federal contractor in fiscal year 2001. About 76 percent of Tyco's 
federal contracts are with the Department of Defense. The contracts 
are for such products and services as aeronautical and nautical system 
manufacturing, architect and engineering services, construction and 
restoration of facilities, maintenance and repairs, general purpose 
machine manufacturing, and environmental consulting services. 

According to SEC filings, in 1997 Tyco International, Ltd., 
incorporated in Massachusetts, merged into ADT Limited, a Bermuda 
corporation. The name of the combined company was changed from ADT 
Limited to Tyco International, Ltd. Each Tyco share was converted to 
one share of stock in the combined company. In a press release, Tyco 
said that the combined company would provide cost, marketing, and 
service synergies. According to the prospectus to shareholders filed 
with the SEC, keeping the company incorporated in Bermuda would allow 
the combined company to preserve certain advantages enjoyed by AI)T 
Limited. For example, Tyco International reported that its overall tax 
savings was over $400 million in 2001. 

[End of section] 

Footnotes: 

[1] The term "tax haven" is generally used in research and the media 
to refer to countries that have no or nominal taxes. Multinational 
companies incorporated in a tax haven may have U.S. based subsidiaries 
that pay U.S. taxes. The Organization for Economic Cooperation and 
Development (OECD) has developed criteria for identifying countries 
that may engage in harmful tax competition in the form of tax havens. 

[2] Department of the Treasury, Office of Tax Policy, Corporate 
Inversion Transactions: Tax Policy Implications (Washington, D.C.: May 
17, 2002). 

[3] Organization for Economic Cooperation and Development, Towards 
Global Tax Co-operation: Progress in Identifying and Eliminating 
Harmful Tax Practices (2000); Organization for Economic Cooperation 
and Development, The OECD's Project on Harmful Tax Practices: The 2001 
Progress Report (November 2001); and OECD's List of Unco-operative Tax 
Havens (April 18, 2002). We referred to OECD's list of 31 countries 
that have made commitments to end "harmful tax practices" by December 
31, 2005, as well as to OECD's list of seven countries that have not 
made such commitments. The commitments are to transparency and 
effective exchange of information. In this report we refer to these 38 
countries as tax havens. 

[4] New York State Bar Association Tax Section, Report on Outbound 
Inversion Transactions, Report No. 1014 (Albany, N.Y.: May 24, 2002) 
and Congressional Research Service, Firms That Incorporate Abroad for 
Tax Purposes: Corporate "Inversions" and "Expatriation" (Washington, 
D.C.: Sept. 20, 2002). 

[5] New York State Bar Association Tax Section, Report on Outbound 
Inversion Transactions, Report No. 1014 (Albany, N.Y.: May 24, 2002). 

[End of section]