Thank you for your question.
I guess I'll come at it like this. We have two issues, I think, one going forward and one dealing with the legacy. Going forward, we want to make sure we have a modern information system that can collect the financial and inventory information and put it in one place. That's being done. Two, we want to make sure going forward that all of the people buying and entering inventory information into the system are well trained, have clear policies, and have clear practices. We have the accountability in place that they're to do this and take this seriously. This is going forward. That's being done.
We want to make sure going forward that we're putting in the inventory and it's clear and correct, and I think even the Auditor General acknowledges that in terms of quantity, we made significant progress and it's in not too bad a shape, but there's still more to do on quantity—how many of this and how many of that.
I think where the Auditor General has signalled a problem is on the value of that inventory. What we're trying to do with the technology project, with the information systems, with the accountability and with the policies and practices for things we're buying now.... It's going in, and it's relatively clean and accurate.
Now we have a legacy problem. Before 2003, nobody worried that much about what the value per se was. We needed to know how many pairs of boots were in the warehouse and how many bullets were in the warehouse. The systems weren't designed to track their value so that we could report it. We have an issue with what we do with the legacy of material that's there. To go back to Mr. Chen's earlier comment, that's why we have two tracks: first, going forward, let's not create any more problems. Let's get good information and not create more problems. Then, how do we clean up what's there? We still need some of that inventory. It may be 20 years old, but we still need it because we're using that equipment.
We're trying to do it in a number of ways. One, every year we go in and do a stock-taking on a portion of it. We're doing a billion dollars worth of parts every year. We've done $4 billion to date.
Two, we're trying to get rid of the old obsolete material that we no longer need. We should get rid of it and we should take it out of the system.
Three, we need to look at how we put a price on it in 2003, because some of it would have just been estimated, and they may not have had the records of what they bought. That's the work we're doing on pricing. We're going in and saying, “Hmm, that thing's only valued at $10, but it's actually worth $1,000.”
We're trying to track it in two ways going forward, first in systems, technology, policies, accountability, and then cleaning up the legacy. I think the Auditor General has recognized that we've done some good work and made some good progress on quantity, and, yes, we've got to deal with the value and the price we want to put on that material. It's mostly for the older legacy material, not the newer stuff coming in, and that's the part we're trying to do.