Halliburton Has More Time to Verify Costs(avoids possible 15% withholding

[papau]

http://www.nytimes.com/2004/08/17/politics/17halliburton.html


Halliburton Has More Time to Verify Costs(avoids possible 15% withholding)
By JENNIFER BAYOT

Published: August 17, 2004

The Halliburton Company said yesterday that the United States Army had granted it additional time to substantiate its costs in Iraq and Kuwait, staving off the possible withholding of 15 percent of its payment.

Government contractors normally cannot be paid more than 85 percent of their invoices until they fully account for their costs. Twice this year, the Army set this rule aside for Halliburton as the company cataloged its costs and explained how it was billing the government. The most recent reprieve expired on Sunday.

The Army would not immediately confirm that it had given Halliburton a third extension. Linda Theis, a spokeswoman for Army Field Support Command in Rock Island, Ill., a part of the Army Matériel Command, said late yesterday that Army personnel were talking with representatives of Kellogg Brown & Root, the Halliburton subsidiary that is working in Iraq, to resolve the billing dispute.<snip>

Although hundreds of millions of dollars are at issue, withholding payments would have no effect on Halliburton's cash flow, the company said. Kellogg Brown & Root would simply deny its subcontractors that money, Ms. Hall said. "This is in accordance with contract agreements with subcontractors," she said. Even so, she added, "we believe these issues will be resolved in our favor." <snip>