a

GAO

United States General Accounting Office

Report to Congressional Requesters

February 2004 INTERNATIONAL 

TAXATION

Information on 

Federal Contractors 

With Offshore 

Subsidiaries

GAO-04-293
Page i GAO-04-293 Contractor Subsidiaries in Tax Havens

Contents

Letter 1

Results in Brief 3

Background 3

Over Half of the 100 Largest Publicly Traded Federal Contractors 

Report Having a Subsidiary in a Tax Haven Country, Including 

Some that Report Having a Foreign Sales Corporation in a Tax 

Haven Country 6

Agency Comments 7

Appendixes

Appendix I: Scope and Methodology 9

Appendix II: List of Tax Haven Countries 12

Appendix III: The 100 Largest Publicly Traded Federal Contractors (Fiscal 

Year 2001) 13

Appendix IV: Federal Contractors that Report Having a Subsidiary in a 

Tax Haven Country 17

Appendix V: GAO Contacts and Staff Acknowledgments 25

GAO Contacts 25

Acknowledgments 25

Tables Table 1: The 100 Largest Publicly Traded Federal Contractors 13

Table 2: Corporations Among the 100 Largest Publicly Traded 

Federal Contractors that Report Having Subsidiaries and 

Foreign Sales Corporations Incorporated in Tax Haven 

Countries 17

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Page 1 GAO-04-293 Contractor Subsidiaries in Tax Havens

United States General Accounting Office

Washington, D.C. 20548

A

February 2, 2004 Letr

The Honorable Byron Dorgan

Ranking Minority Member 

Subcommittee on Competition, Foreign Commerce, and Infrastructure 

Committee on Commerce, Science, and Transportation

United States Senate

The Honorable Carl Levin

Ranking Minority Member

Permanent Subcommittee on Investigations

Committee on Governmental Affairs

United States Senate

Every year, U.S.-based multinational corporations transfer hundreds of 

billions of dollars of goods and services between their affiliates in the 

United States and their foreign subsidiaries. Such transactions may be a 

part of normal business operations for corporations with foreign 

subsidiaries. However, it is generally recognized that given the variation in 

corporate tax rates across countries, an incentive exists for corporations 

with foreign subsidiaries to reduce their overall tax burden by maximizing 

the income they report in countries with low income tax rates, and 

minimizing the income they report in or repatriate to countries with high 

income tax rates. Various studies have suggested that U.S.-based 

multinational corporations appear to engage in transactions such as these 

that shift income from their affiliates in high-tax countries to subsidiaries in 

low-tax countries to take advantage of the differences in tax rates in 

foreign countries.1

 

1

A survey of studies that examine income shifting by multinational corporations appears in 

Department of the Treasury, Office of Tax Policy, The Deferral of Income Earned Through 

U.S. Controlled Foreign Corporations (Washington, D.C.: December 2000), 197-213.
Page 2 GAO-04-293 Contractor Subsidiaries in Tax Havens

In 2002, GAO reported that 4 of the 100 largest publicly traded federal 

contractors are incorporated in a “tax haven” country that either does not 

tax corporate income or taxes the income at a low rate.2

 As a follow-up to 

the report, you asked us to determine which, if any, of the 100 largest 

publicly traded federal contractors we identified in our 2002 report have 

subsidiaries that are incorporated in a tax haven country. You further 

asked us to determine, to the extent possible, which of these subsidiaries 

are Foreign Sales Corporations, a type of corporation that can exempt a 

portion of its foreign sales income from U.S. tax.

To determine which, if any, of the 100 largest publicly traded federal 

contractors (in terms of fiscal year 2001 contract obligations) we identified 

in our 2002 report have subsidiaries in a tax haven country, we reviewed 

various public documents the corporations filed with the Securities and 

Exchange Commission (SEC) on its Electronic Data Gathering, Analysis, 

and Retrieval (EDGAR) system. We used information from the documents 

each corporation filed with the SEC that were the most recent available at 

the time we reviewed that corporation’s filings. However, as the SEC only 

requires public corporations to report their significant subsidiaries,3

 we 

were only able to identify those subsidiaries that the contractors reported 

to the SEC, or disclosed through other means. In certain cases, we 

obtained subsidiary information from corporate representatives or the 

corporations’ Web sites. To determine whether a country is considered a 

tax haven, we referred to the criteria the Organisation of Economic Cooperation and Development (OECD) has developed to characterize tax 

haven countries. We did not attempt to determine if corporations with 

subsidiaries in tax haven countries engaged in transactions with their 

subsidiaries intended to reduce their overall tax burden. (For a more 

detailed discussion of our scope and methodology, see app. I). We 

2

U.S. General Accounting Office, Information on Federal Contractors That Are 

Incorporated Offshore, GAO-03-194R (Washington, D.C.: Oct. 1, 2002). The term “tax haven” 

is generally used in research and the media to refer to countries that have no or nominal 

taxes. In this report, the term “tax haven country” includes various possessions and 

overseas territories of the United States and other countries. For an expanded discussion of 

tax havens, see appendices I and II. For a list of the 100 largest publicly traded federal 

contractors in fiscal year 2001, see appendix. III. 

3

Public corporations may omit information in their SEC filings on subsidiaries which, when 

considered in the aggregate, would not constitute a significant subsidiary, and on 

consolidated wholly owned multiple subsidiaries carrying on the same line of business 

(such as chain stores). 
Page 3 GAO-04-293 Contractor Subsidiaries in Tax Havens

conducted our review between July and December 2003 in accordance with 

generally accepted government auditing standards.

Results in Brief Fifty-nine of the 100 largest publicly traded federal contractors from fiscal 

year 2001 report having a subsidiary in a tax haven country. Fifty-eight of 

these 59 corporations also report having additional foreign subsidiaries in 

countries other than tax havens. Likewise, 26 of the 59 corporations that 

report having a subsidiary in a tax haven country report that at least one of 

these subsidiaries is a Foreign Sales Corporation. Four of these 26 

contractors also report having additional Foreign Sales Corporations in 

countries other than tax havens. However, as the SEC only requires 

corporations to report their significant subsidiaries, there may be 

additional corporations among the 100 largest publicly traded federal 

contractors that have a subsidiary in a tax haven country. Likewise, some 

corporations that report having a subsidiary in a tax haven country could 

have additional subsidiaries in tax haven countries that they have not 

reported. The simple existence of a subsidiary in a tax haven country does 

not signify that a corporation has established that subsidiary primarily for 

the purpose of reducing its overall tax burden. 

Background There are few corporations of any significant size that are not faced with 

applying international tax rules to some aspect of their business. Under the 

U.S. income tax system, domestic corporations are taxed on income 

regardless of where it is earned. Thus, U.S. corporations are subject to U.S. 

tax on income from foreign operations in addition to the foreign tax they 

pay on such income in the country where it is earned.4

 However, income a 

corporation’s foreign subsidiary earns is usually not subject to U.S. tax until 

the subsidiary repatriates the income to its U.S. parent.5

 The deferral of 

U.S. tax liability from a foreign subsidiary’s income can provide that 

subsidiary’s U.S. parent corporation with financial benefits if this income is 

invested abroad on a long-term basis. 

4

Under the U.S. foreign tax credit system, corporations generally can reduce the U.S. tax on 

income earned from foreign operations by the amount of the income and withholding taxes 

they pay on this income in the country where it is earned. 

5

Certain income of a U.S. corporation’s foreign subsidiary, such as passive, investment-type 

income is subject to U.S. tax without regard to whether the income is repatriated to the U.S. 

parent.
Page 4 GAO-04-293 Contractor Subsidiaries in Tax Havens

Likewise, every year, U.S.-based multinational corporations transfer 

hundreds of billions of dollars of goods and services between their 

affiliates in the United States and their foreign subsidiaries. Although such 

transactions may be a part of normal business operations for multinational 

corporations, variations in corporate tax rates across countries create the 

potential for multinational corporations to engage in transactions with 

their foreign subsidiaries with the purpose of reducing their overall tax 

burden. For example, multinational corporations may try to maximize the 

income they report in countries with low tax rates through the pricing of 

intercompany transactions of goods or services. Pricing of intercompany 

transactions across tax jurisdictions can affect the distribution of profits 

and, therefore, taxable income among related companies. Underpayment 

of U.S. income taxes can result from the inappropriate pricing of 

transactions between interrelated companies with operations in both the 

United States and in a country with a lower tax rate.6

 Likewise, 

multinational corporations may try to minimize income reported in the 

United States through deductible interest payments to their subsidiaries in 

low-tax countries. Under certain circumstances, the interest expense that 

U.S. corporations pay on debt that their foreign subsidiaries issue them is 

deductible for U.S. tax purposes, and can serve to reduce a corporation’s 

taxable income in the United States. Transactions intended to reduce a 

corporation’s overall tax burden may be particularly relevant to 

corporations with subsidiaries in tax haven countries that impose no or 

nominal tax on income. 

The United States has, however, enacted various legislative provisions 

since the 1970s intended to reduce the amount of U.S. tax that U.S. 

corporations pay on income earned from the export of goods and services 

to foreign countries. One set of these provisions, the Foreign Sales 

Corporation (FSC) provisions, was enacted in 1984 as a replacement to the 

Domestic International Sales Corporation (DISC) provisions (enacted in 

1971).7

 A Foreign Sales Corporation generally is not subject to U.S. income 

tax on certain foreign trade income, and a U.S. corporation generally is not 

subject to U.S. income tax on dividends paid by a Foreign Sales 

6

Even when the U.S. corporate tax rate is lower than that of another country, intercompany 

pricing abuses can occur by shifting income through another related company that operates 

in a low-tax country.

7

The United States replaced the DISC benefit with the FSC provisions after a General 

Agreement on Tariffs and Trade (GATT) panel ruled that the DISC benefit was a prohibited 

export subsidy.
Page 5 GAO-04-293 Contractor Subsidiaries in Tax Havens

Corporation out of certain earnings. As such, Foreign Sales Corporations 

and their parent corporations can receive a tax benefit from income 

reported in the United States that is not available to U.S. corporations that 

report income from other types of foreign subsidiaries, which is taxed 

without the FSC exemption, generally at the time it is repatriated to the 

United States.

The Internal Revenue Service (IRS) estimates that in 2000, the latest year 

for which data are available,8

 there were 4,200 Foreign Sales Corporations 

representing gross receipts of $349.0 billion, total income of $43.9 billion, 

taxable income of $6.7 billion, and a tax liability of $2.3 billion. An 

estimated 88 percent of these Foreign Sales Corporations reported receipts 

from the sale of manufactured products. Foreign Sales Corporations can 

only be established in U.S. possessions (excluding Puerto Rico) or 

countries with whom the United States has an agreement on the exchange 

of tax information, including a number of tax haven countries. 

In 2000, the FSC Repeal and Extraterritorial Income Exclusion Act9

replaced the FSC provisions with the Extraterritorial Income (ETI) 

provisions.10 The ETI provisions provide corporations with tax benefits 

similar to those the FSC provisions provide. However, the ETI provisions 

permit corporations to exclude certain qualifying foreign trade income 

from U.S. tax, and are not restricted to the export of goods and services 

through a foreign corporation. Although the FSC provisions were repealed 

in 2000, Foreign Sales Corporations in existence prior to September 30, 

2000, can continue to use the FSC rules for transactions related to a binding 

contract with an outside party.

8

Foreign Sales Corporation data in this report are from IRS’ Statistics of Income division 

estimates. GAO did not verify these data.

9

P.L. 106-519.

10Although the United States designed the FSC provisions to comply with GATT, in 1999 the 

World Trade Organization (WTO), which supplanted GATT in 1995, concluded that the FSC 

provisions constituted a prohibited export subsidy. Likewise, although the ETI benefit was 

designed to comply with WTO rules, the WTO ruled in 2001 that the ETI provisions 

constitute an illegal export subsidy, and has since approved the European Union’s request to 

assess up to $4 billion in sanctions against the United States. The European Union has 

stated that they will begin to impose sanctions beginning March 1, 2004, if the United States 

fails to comply with the WTO ruling. Congress is currently considering a number of 

proposals intended to replace the ETI provisions with alternative tax benefits.
Page 6 GAO-04-293 Contractor Subsidiaries in Tax Havens

Over Half of the 100 

Largest Publicly 

Traded Federal 

Contractors Report 

Having a Subsidiary in 

a Tax Haven Country, 

Including Some that 

Report Having a 

Foreign Sales 

Corporation in a Tax 

Haven Country

Eighty-six of the 100 largest publicly traded federal contractors from fiscal 

year 2001 report having a foreign subsidiary, of which 59 report having a 

subsidiary incorporated in a tax haven country. Of these 59 corporations, 

58 also report having additional foreign subsidiaries in countries other than 

tax havens. However, as the SEC only requires public corporations to 

report their significant subsidiaries, there may be additional corporations 

among the 100 largest publicly traded federal contractors that have a 

subsidiary in a tax haven country. Likewise, some corporations that report 

having a subsidiary in a tax haven country could have additional 

subsidiaries in tax haven countries that they have not reported. However, 

given SEC regulations, these subsidiaries would not be “significant” in 

relation to their parent corporations’ consolidated assets or equity in 

income from continuing operations. (For a complete list of the 

corporations among the 100 largest publicly traded federal contractors 

from fiscal year 2001 that report having a subsidiary in a tax haven country, 

see app. IV). 

In addition, 26 of the 59 federal contractors that report having a subsidiary 

in a tax haven country report that at least one of these subsidiaries is a 

Foreign Sales Corporation. Four of these 26 corporations also report 

having additional Foreign Sales Corporations in countries other than tax 

havens. Other than these 26 corporations, one additional corporation 

among the 100 largest publicly traded federal contractors reports having a 

Foreign Sales Corporation. The predominance of Foreign Sales 

Corporations incorporated in tax haven countries among the 100 largest 

publicly traded federal contractors is comparable to the incorporation 

locations of all Foreign Sales Corporations. According to the IRS, in 2000 

an estimated 92 percent of all Foreign Sales Corporations were 

incorporated in the tax haven countries of the U.S. Virgin Islands (52 

percent), Barbados (35 percent), and Bermuda (5 percent). According to 

an IRS official, the vast majority of Foreign Sales Corporations are 

incorporated in tax haven countries because, although a portion of the 

income these corporations earn is exempt from U.S. tax, this income may 

be subject to tax in the country where it is earned. As such, incorporating a 

Foreign Sales Corporation in a country with a high tax rate would not 

provide the overall tax savings that the FSC provisions would otherwise 

provide.
Page 7 GAO-04-293 Contractor Subsidiaries in Tax Havens

As SEC regulations do not specifically require corporations to report if a 

subsidiary is a Foreign Sales Corporation in their public filings,11 additional 

corporations among the 100 largest publicly traded federal contractors that 

may have a Foreign Sales Corporation in a tax haven or other country. 

Furthermore, some corporate representatives we spoke with stated that 

their Foreign Sales Corporations are largely dormant or are being phased 

out, given that the FSC benefit has been replaced by the ETI benefit. (For a 

complete list of the corporations among the 100 largest federal contractors 

from fiscal year 2001 that report having a Foreign Sales Corporation in a 

tax haven country, see app. IV).

The simple existence of a subsidiary in a tax haven country does not signify 

that a corporation has established that subsidiary primarily for the purpose 

of reducing its overall tax burden (although the Foreign Sales Corporation 

benefit was created for that express purpose). Likewise, we did not 

attempt to determine if corporations with subsidiaries in tax haven 

countries engaged in transactions with their subsidiaries intended to 

reduce their overall tax burden. 

Agency Comments We provided a draft of this report to the IRS and the SEC for their 

comment. In a letter dated January 12, 2004, the IRS stated that they had 

no comments with regard to tax administration issues, and had referred the 

report to the Department of The Treasury to comment on tax policy issues. 

On January 12, Treasury provided oral comments on several technical 

issues, which we incorporated into this report where appropriate. The SEC 

stated in a January 13, 2004, letter that the report provided a useful 

description of the 100 largest publicly traded federal contractors’ offshore 

subsidiaries and related tax matters. On the same date, the SEC also 

provided an additional oral comment on a technical matter, which we 

incorporated into this report.

As arranged with your offices, unless you publicly announce its contents 

earlier, we plan no further distribution of this report until 30 days after the 

date of this report. We will then send copies of this report to the 

Commissioner of Internal Revenue, the Chairman, Securities and Exchange 

Commission, and other interested parties. We will also make copies 

11 A corporation may be required to disclose if a subsidiary is a Foreign Sales Corporation if 

that information is material under federal securities laws.
Page 8 GAO-04-293 Contractor Subsidiaries in Tax Havens

available to others on request. In addition, this report will be available at 

no charge on GAO’s Web site at http://www.gao.gov.

If you have any questions concerning this report, please contact me on 

(202) 512-9110. Key contributors to this report are listed in appendix V.

James R. White

Director, Tax Issues
Page 9 GAO-04-293 Contractor Subsidiaries in Tax Havens

Appendix I

Scope and Methodology AAppenednxidexiIs

We used the list of the 100 largest publicly traded federal contractors in 

fiscal year 2001 identified in our October 2002 report, Information on 

Federal Contractors That Are Incorporated Offshore (GAO-03-194R) as the 

basis to determine which, if any, of the 100 largest publicly traded federal 

contractors have subsidiaries in tax haven countries. To identify which, if 

any, of these corporations report having a subsidiary in a tax haven 

country, we reviewed various public documents the corporations filed with 

the Securities and Exchange Commission (SEC) on its Electronic Data 

Gathering, Analysis, and Retrieval (EDGAR) system. For U.S. 

corporations, we reviewed the lists of subsidiaries that public corporations 

are required to include as an exhibit (Exhibit 21)1

 to a number of forms 

they file with the SEC. We obtained this exhibit from each corporation’s 

Form 10-K2

 because, according to the SEC, although U.S. corporations can 

include Exhibit 21 with a number of forms, they most often file this exhibit 

with Form 10-K on an annual basis. However, for 2 U.S. corporations, we 

obtained subsidiary information from Exhibit 21 to Form S-1,3

 because that 

form was the most recent filed with the SEC that contained this exhibit. 

For foreign corporations, we obtained subsidiary information from Form 

20-F,4

 or an exhibit to this form (Exhibit 8), which foreign corporations 

registered with the SEC file on an annual basis instead of Form 10-K. For 

each corporation, we reported information from the Exhibit 21 or Form 20-

F that was the most recent available at the time we reviewed that 

corporation’s filings with the SEC. 

As the SEC only requires public corporations to report their significant 

subsidiaries, we were only able to identify those subsidiaries the 

contractors reported to the SEC or disclosed through other means. Within 

Exhibit 21 or Form 20-F, public corporations may omit information on 

those subsidiaries that do not constitute a significant subsidiary when 

considered in the aggregate. The SEC considers a subsidiary to be 

1

In Exhibit 21, public corporations are required to list their subsidiaries and the names 

under which they do business, and their state or jurisdiction of incorporation or 

organization.

2

Form 10-K is used for the annual reports or transition reports that corporations file with the 

SEC according to the Securities Exchange Act of 1934.

3

Form S-1 is a Registration Statement corporations file with the SEC according to the 

Securities Act of 1933. 

4

Form 20-F is used as the Registration Statement, Annual Report, or Transition Report that 

foreign corporations file with the SEC according to the Securities Exchange Act of 1934. 
Appendix I

Scope and Methodology

Page 10 GAO-04-293 Contractor Subsidiaries in Tax Havens

significant if: 1) the parent corporation and its other subsidiaries’ 

investments in and advances to the subsidiary exceed 10 percent of the 

consolidated total assets of the parent corporation and its subsidiaries, 2) 

the parent corporation and its other subsidiaries’ proportionate share of 

the total assets (after intercompany eliminations) of the subsidiary exceeds 

10 percent of the consolidated total assets of the parent corporation and its 

subsidiaries, or 3) the parent corporation and its other subsidiaries’ equity 

in the income from continuing operations5 exceeds 10 percent of the 

consolidated income from continuing operations of the parent corporation 

and its subsidiaries. Corporations may also omit information on 

consolidated wholly owned multiple subsidiaries carrying on the same line 

of business (such as chain stores). Likewise, the SEC does not specifically 

require corporations to report whether a subsidiary is a Foreign Sales 

Corporation within their filings.6

 

For a number of corporations, we supplemented information from EDGAR 

with information from corporate representatives or the corporations’ Web 

sites. For example, we contacted 22 corporations to clarify or supplement 

unclear or incomplete information they reported in their Exhibit 21 filings. 

We also obtained information on the principle subsidiaries for 5 foreign 

corporations that are not registered with the SEC from annual reports or 

other information available on these corporations’ Web sites. Furthermore, 

we contacted the 18 corporations that did not report having any foreign 

subsidiaries in their SEC filings to verify this information. Some of these 

corporations disclosed having foreign subsidiaries that they did not report 

in their SEC filings (implying that in the aggregate, these corporations did 

not deem these subsidiaries to be significant), including 4 that disclosed 

having a foreign subsidiary in a tax haven country (these corporations are 

noted in apps. III and IV). We did not contact corporations that reported 

having foreign subsidiaries only in countries other than tax havens to 

determine if they had additional subsidiaries incorporated in a tax haven 

country that they did not report.7

To determine whether a country is considered a tax haven, we referred to 

the Organisation of Economic Co-operation and Development’s work on 

5

In this case, the SEC defines such income as income from continuing operations before 

income taxes, extraordinary items, and the cumulative effect of a change in accounting 

principle. 

6

A corporation may be required to disclose if a subsidiary is a Foreign Sales Corporation if 

that information is material under federal securities laws.
Appendix I

Scope and Methodology

Page 11 GAO-04-293 Contractor Subsidiaries in Tax Havens

tax havens – OECD, Progress in Identifying and Eliminating Harmful 

Tax Practices (2000); The OECD’s Project on Harmful Tax Practices: The 

2001 Progress Report (November 2001); and List of Unco-operative Tax 

Havens (April 18, 2002, and revised on May 20, 2003). Although the OECD 

does not provide a unique definition of the term “tax haven,” we use the 

term in this report because it is the term we used in our October 2002 

report to refer to countries that impose no or nominal tax on corporate 

income, and because the OECD has established a set of criteria to 

characterize a tax haven country or jurisdiction. Specifically, the OECD 

stipulates four major features of a tax haven: 1) no or nominal income tax, 

2) rules that prevent the effective exchange of information with foreign tax 

authorities, 3) a lack of transparency in the operation of legislative, legal, or 

administrative provisions, and 4) the absence of a requirement for a 

substantive local presence. In general, the OECD classifies a country as a 

tax haven if it meets the criteria of no or nominal income tax, and at least 

one of the other criteria. (For a list of countries the OECD considers tax 

havens, see app. II).

Finally, although we identify the corporations among the 100 largest 

publicly traded federal contractors that report having a subsidiary in a tax 

haven country, we did not attempt to determine if these corporations 

engaged in transactions with their subsidiaries intended to reduce their 

overall tax burden. 

7

We did include information on additional subsidiaries that TRW, Inc. did not report in its 

Exhibit 21 filing, which we obtained during the course of communication with TRW, Inc.’s 

corporate parent, Northrop Grumman Corporation (another of the 100 largest publicly 

traded federal contractors; see app. IV).
Page 12 GAO-04-293 Contractor Subsidiaries in Tax Havens

Appendix II

List of Tax Haven Countries ApendxiI

The Organisation of Economic Co-operation and Development (OECD) has 

identified 39 countries or jurisdictions that they consider to be tax havens.1

 

In this report we refer to these 39 countries and jurisdictions as tax havens:

1

The OECD has identified two types of tax haven countries–the 34 countries that have made 

commitments to cooperate with the OECD in addressing “harmful tax practices” by 

December 31, 2005, and the 5 countries that have not made such commitments (Andorra, 

Liberia, The Principality of Liechtenstein, The Republic of the Marshall Islands, and the 

Principality of Monaco). The commitments are to transparency and effective exchange of 

information. 

• Andorra • The Principality of Liechtenstein

• Anguilla • Malta

• Antigua and Barbuda • The Republic of the Marshall Islands

• Aruba • Mauritius

• Bahamas • The Principality of Monaco

• Bahrain • Montserrat

• Barbados • The Republic of Nauru

• Belize • Netherlands Antilles

• Bermuda • Niue

• British Virgin Islands • Panama

• Cayman Islands • St. Christopher (St. Kitts) and Nevis

• Cook Islands • St. Lucia

• Cyprus • St. Vincent and the Grenadines

• Dominica • Samoa

• Gibraltar • San Marino

• Grenada • Seychelles

• Guernsey • Turks & Caicos

• Isle of Man • U.S. Virgin Islands

• Jersey • Vanuatu

• Liberia
Page 13 GAO-04-293 Contractor Subsidiaries in Tax Havens

Appendix III

The 100 Largest Publicly Traded Federal 

Contractors (Fiscal Year 2001) ApendxiI

The following table lists the 100 largest federal contractors that are publicly 

traded corporations, their rank among the 100 largest publicly traded 

federal contractors in fiscal year 2001, the dollar amount of their fiscal year 

2001 federal contracts, the state or country where they are incorporated, 

and the number of their foreign subsidiaries. Unless otherwise noted, we 

obtained the information on the number of each corporation’s foreign 

subsidiaries from forms filed with the Securities and Exchange 

Commission. We were unable to provide information on the number of 

foreign subsidiaries for the Lockheed Martin Corporation, which did not 

include this information in an Exhibit 21 filing, and did not respond to our 

request for this information before this report was completed. Likewise, 

Honeywell International, Inc., which did not report having any foreign 

subsidiaries in its Exhibit 21 filing, provided us with information on its 

Foreign Sales Corporations, but not its other foreign subsidiaries.

Table 1: The 100 Largest Publicly Traded Federal Contractors

Company name Rank

Federal contract 

obligations FY 2001 

(dollars in thousands)a

Incorporation 

location

Number of 

foreign 

subsidiaries

Accenture, Inc. 58 $278,990 Bermuda 153

Affiliated Computer Services, Inc. 37 451,067 Delaware 24

Alliant Techsystems, Inc. 20 826,269 Delaware 0

Altria Group, Inc.b 80 149,634 Virginia 263

American Management Systems, Inc. 13 1,675,676 Delaware 17

AmerisourceBergen Corporation 10 1,900,969 Delaware 1r

Anteon International Corporationc 41 406,304 Delaware 4r

Anthem, Inc. 55 293,153 Indiana 0

Archer Daniels Midland Company 70 189,876 Delaware 9

AT&T Corporation 43 398,326 New York 116r

Avaya, Inc. 94 115,079 Delaware 62

BAE Systems, plc 16 972,526 United Kingdom 6ds

Ball Corporation 78 153,613 Indiana 47

Bearingpoint, Inc.e 90 177,456 Delaware 101

Berkshire Hathaway, Inc. 97 111,993 Delaware 13

The Boeing Company 2 14,362,243 Delaware 96

BP, plc 36 480,858 United Kingdom 27

CACI International, Inc. 46 380,524 Delaware 2

Cardinal Health, Inc. 40 422,120 Ohio 98
Appendix III

The 100 Largest Publicly Traded Federal 

Contractors (Fiscal Year 2001)

Page 14 GAO-04-293 Contractor Subsidiaries in Tax Havens

CNF, Inc. 54 295,113 Delaware 49r

Computer Associates International 75 172,202 Delaware 45

Computer Sciences Corporation 14 1,648,495 Nevada 97

ConAgra Foods, Inc. 83 131,850 Delaware 4

Cubic Corporation 91 117,054 Delaware 6

DaimlerChrysler AG 38 435,921 Germany 1

Dell, Inc.f 34 493,423 Delaware 76

DRS Technologies, Inc. 93 116,395 Delaware 10

Electronic Data Systems Corporation 26 560,767 Delaware 313

Engineered Support Systems, Inc. 50 321,384 Missouri 0r

Exxon Mobil Corporation 21 707,283 New Jersey 90

FedEx Corporation 64 214,907 Delaware 75

Fluor Corporation 18 931,885 Delaware 202

Ford Motor Company 73 179,126 Delaware 46

Foster Wheeler, Ltd. 57 286,298 Bermuda 92

Furniture Brands International, Inc. 96 112,395 Delaware 9

GenCorp, Inc. 84 131,848 Ohio 29

General Dynamics Corporation 6 4,928,238 Delaware 26g

General Electric Company 12 1,808,984 New York 10

General Motors Corporation 63 222,440 Delaware 200

Goodrich Corporation 52 308,283 New York 62

GTSI Corporation 42 402,408 Delaware 0r

Halliburton Company 30 534,177 Delaware 131

Harris Corporation 45 389,970 Delaware 32

Health Net, Inc. 17 944,618 Delaware 2

Hillenbrand Industries, Inc. 95 114,456 Indiana 27

Holly Corporation 87 121,831 Delaware 0

Honeywell International, Inc. 15 1,442,018 Delaware 3r

Humana, Inc. 44 394,135 Delaware 2

International Business Machines Corporation 33 498,656 New York 98

The IT Group, Inc.h 22 671,977 Delaware 25r

ITT Industries, Inc. 19 879,772 Indiana 142

Jacobs Engineering Group, Inc. 29 536,130 Delaware 48

Johnson Controls, Inc. 53 299,592 Wisconsin 76

L-3 Communications Holdings, Inc. 35 482,248 Delaware 45r

Lockheed Martin Corporation 1 17,951,303 Maryland unknown

(Continued From Previous Page)

Company name Rank

Federal contract 

obligations FY 2001 

(dollars in thousands)a

Incorporation 

location

Number of 

foreign 

subsidiaries
Appendix III

The 100 Largest Publicly Traded Federal 

Contractors (Fiscal Year 2001)

Page 15 GAO-04-293 Contractor Subsidiaries in Tax Havens

Lucent Technologies, Inc. 98 107,402 Delaware 93

ManTech International Corporation 56 291,513 New Jersey 15

McDermott International, Inc. 11 1,885,243 Panama 10

McKesson Corporation 88 121,526 Delaware 0

Motor Oil (Hellas) Corinth Refineries S.A. 69 199,462 Greece 2s

Motorola, Inc. 27 552,520 Delaware 20

Newport News Shipbuilding, Inc.i 4 5,689,539 Delaware 0

Northrop Grumman Corporationj 5 5,636,124 Delaware 52r

Olin Corporation 100 104,121 Virginia 13

Oracle Corporation 65 212,468 Delaware 84

Orbital Sciences Corporation 77 161,286 Delaware 0

Oshkosh Truck Corporation 25 566,511 Wisconsin 20

Parker-Hannifin Corporation 79 153,562 Ohio 95

PC Connection, Inc. 92 116,919 Delaware 0

Philipp Holzmann AG 23 655,360 Germany 5s

The Procter and Gamble Company 62 224,212 Ohio 306

Raytheon Company 3 6,123,605 Delaware 95

Rockwell Automation, Inc.k 47 372,131 Delaware 10

Rockwell Collins, Inc. 61 234,075 Delaware 2

Rolls-Royce, plc 49 327,792 United Kingdom 30ls

Science Applications International Corporation 8 2,654,492 Delaware 15

Siemens AG 85 124,452 Germany 102

Smiths Group, plc 72 184,232 United Kingdom 11s

Sprint Corporation 82 136,200 Kansas 56

SRA International, Inc. 60 234,926 Delaware 0

Telos Corporation 89 118,803 Maryland 0mr

Tetra Tech, Inc. 66 211,705 Delaware 3

Texas Instruments, Inc. 74 178,631 Delaware 51

Textron, Inc. 24 600,533 Delaware 19

The Titan Corporation 39 424,087 Delaware 4

TRW, Inc.n 9 2,499,816 Ohio 33r

Tyco International, Ltd. 68 206,387 Bermuda 1,736

Unisys Corporation 28 549,905 Delaware 8

United Industrial Corporation 76 171,044 Delaware 2

United Technologies Corporation 7 3,500,465 Delaware 66

URS Corporation 59 262,489 Delaware 94

(Continued From Previous Page)

Company name Rank

Federal contract 

obligations FY 2001 

(dollars in thousands)a

Incorporation 

location

Number of 

foreign 

subsidiaries
Appendix III

The 100 Largest Publicly Traded Federal 

Contractors (Fiscal Year 2001)

Page 16 GAO-04-293 Contractor Subsidiaries in Tax Havens

Sources: General Services Administration, Securities and Exchange Commission, corporate representatives, and GAO Internet research.

a

 Contract obligations include contracts with subsidiaries.

b

 Formerly Philip Morris Companies, Inc.

c Formerly Azimuth Technologies, Inc.

d BAE Systems, plc also participates in eight foreign joint ventures.

e

 Formerly KPMG Consulting, Inc.

f Formerly Dell Computer Corporation.

g Does not include Veridian Corporation (or its subsidiaries), which General Dynamics acquired after 

fiscal year 2001. Information on Veridian Corporation and its subsidiaries are presented separately in 

this report.

h Assets acquired by the Shaw Group in May 2002; corporation still exists in bankruptcy.

i Merged with Northrop Grumman Corporation in November 2001.

j Does not include Newport News Shipbuilding or TRW, Inc. (or their subsidiaries), which Northrop 

Grumman acquired after fiscal year 2001. Information on Newport News Shipbuilding and TRW, Inc., 

and their subsidiaries are presented separately in this report.

k

 Formerly Rockwell International Corporation. 

l Rolls-Royce, plc also participates in 20 foreign joint ventures.

m Telos Corporation also holds a 50 percent interest in a foreign joint venture that has been inactive 

since 2000.

n Acquired by Northrop Grumman Corporation in December 2002. 

o Acquired by General Dynamics Corporation in August 2003.

p

 Acquired by Group 4 Falck (Denmark) in May 2002; does not include Wackenhut Corrections 

Corporation (or its subsidiaries), which is now an independent corporation.

q

 Formerly Roy F. Weston, Inc. and now privately held.

r

 Corporation provided information on foreign subsidiaries directly to GAO.

s

 Information on foreign subsidiaries from annual report or other information available on corporation’s 

Web site.

Valero Energy Corporation 51 310,202 Delaware 10

Veridian Corporationo 71 188,960 Delaware 0

Verizon Communications, Inc. 67 207,210 Delaware 2

The Wackenhut Corporation p 48 356,968 Florida 47

Washington Group International, Inc. 31 531,234 Delaware 35

Weston Solutions, Inc.q 86 124,380 Pennsylvania 1r

WGL Holdings, Inc. 99 105,260 Virginia 0

WorldCom, Inc. 32 503,811 Georgia 187

Xerox Corporation 81 139,224 New York 216

Total $101,770,865

(Continued From Previous Page)

Company name Rank

Federal contract 

obligations FY 2001 

(dollars in thousands)a

Incorporation 

location

Number of 

foreign 

subsidiaries
Page 17 GAO-04-293 Contractor Subsidiaries in Tax Havens

Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country ApendxiIV

The following table shows the 59 corporations among the 100 largest 

publicly traded federal contractors that report having a subsidiary 

incorporated in a tax haven country. Although the dollar amount of 

contract obligations for each corporation includes contracts with their 

subsidiaries, we did not identify if these obligations were related to 

subsidiaries in tax haven countries. The number of foreign subsidiaries 

and number and location(s) of foreign subsidiaries in tax haven countries 

include information on Foreign Sales Corporations. For the 26 

corporations that report having a subsidiary in a tax haven country that is a 

Foreign Sales Corporation, separate information on the number of Foreign 

Sales Corporations and the number and location(s) of Foreign Sales 

Corporations in tax haven countries is provided. The information provided 

for each corporation is based on its latest available information either filed 

with the Securities and Exchange Commission, provided to GAO, or 

presented on its Web site at the time we performed our review of that 

corporation. Unless otherwise noted, we obtained the information on the 

number and locations of foreign subsidiaries and Foreign Sales 

Corporations for each corporation from forms filed with the SEC. 

Table 2: Corporations Among the 100 Largest Publicly Traded Federal Contractors that Report Having Subsidiaries and Foreign 

Sales Corporations Incorporated in Tax Haven Countries

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s)

of foreign 

subsidiaries

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens

Accenture, Inc. $278,990 Bermuda 153 19

Andorra (1)

Bermuda (5)

Gibraltar (8)

Isle of Man (2)

Mauritius (3)

0 0

Affiliated Computer 

Services, Inc.

451,067 Delaware 24 2

Barbados

0 0

Altria Group, Inc.c 149,634 Virginia 263 9

Bahamas (1)

British Virgin Islands (1)

Cayman Islands (1)

Panama (3)

U.S. Virgin Islands (3)

2 2

U.S. Virgin 

 Islands 

Archer Daniels 

Midland Company

189,876 Delaware 9 1

Cayman Islands

0 0
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 18 GAO-04-293 Contractor Subsidiaries in Tax Havens

AT&T Corporation 398,326 New York 116

(Subsidiary 

information 

provided 

directly by 

corporation) 

5

Cyprus (2)

Panama (1)

U.S. Virgin Islands (2)

2 2

U.S. Virgin 

 Islands

Avaya, Inc. 115,079 Delaware 62 4

Bahrain (1)

Barbados (1)

Gibraltar (1)

Panama (1)

1 1

Barbados 

Bearingpoint, Inc.d 117,456 Delaware 101 22

Aruba (2)

Barbados (1)

Bermuda (8)

British Virgin Islands (2)

Cayman Islands (2)

Netherlands Antilles (6)

Panama (1)

0 0

The Boeing 

Company

14,362,243 Delaware 96 31

Bermuda (6)

British Virgin Islands (1)

Cayman Islands (1)

U.S. Virgin Islands (23)

2 1

U.S. Virgin 

 Islands 

BP, plc 480,858 United 

Kingdom

27 1

Guernsey

0 0

Cardinal Health, Inc. 422,120 Ohio 98 5

Barbados (1)

Bermuda (1)

British Virgin Islands (1)

Malta (1)

St. Lucia (1)

0 0

CNF, Inc. 295,113 Delaware 49

(Subsidiary 

information 

provided 

directly by 

corporation)

3

Bermuda

0 0

Computer 

Associates 

International

172,202 Delaware 45 1

Bahrain

0 0

Cubic Corporation 117,054 Delaware 6 1

U.S. Virgin Islands

1 1

U.S. Virgin 

 Islands

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 19 GAO-04-293 Contractor Subsidiaries in Tax Havens

Dell, Inc.e 493,423 Delaware 76 3

Barbados (1)

Cayman Islands (1)

Panama (1)

0 0

Electronic Data 

Systems 

Corporation

560,767 Delaware 313 8

Bahrain (1)

Barbados (2)

Bermuda (3)

Panama (2)

2 2

Barbados (1)

Bermuda (1)

Exxon Mobil 

Corporation

707,283 New Jersey 90 11

Bahamas 

0 0

FedEx Corporation 214,907 Delaware 75 13

Antigua (1)

Bahamas (1)

Barbados (1)

Bermuda (1)

Cayman Islands (2)

Grenada (1)

Netherlands Antilles (2)

St. Kitts (1)

St. Lucia (1)

Turks & Caicos (1)

U.S. Virgin Islands (1)

0 0

Fluor Corporation 931,885 Delaware 202 27

Barbados (5)

Bermuda (7)

British Virgin Islands (2)

Guernsey (8)

Liechtenstein (2)

Mauritius (3)

2 2

Barbados 

Ford Motor 

Company

179,126 Delaware 46 1

Cayman Islands

0 0

Foster Wheeler, Ltd. 286,298 Bermuda 92 8

Bermuda (6)

Mauritius (1)

Netherlands Antilles (1)

0 0

Furniture Brands 

International, Inc.

112,395 Delaware 9 3

Barbados (1)

Vanuatu (2)

0 0

GenCorp, Inc. 131,848 Ohio 29 2

Bermuda (1)

U.S. Virgin Islands (1)

0 0

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 20 GAO-04-293 Contractor Subsidiaries in Tax Havens

General Dynamics 

Corporationf

4,928,238 Delaware 26 4

Cayman Islands (2)

Cyprus (1)

U.S. Virgin Islands (1)

1 1

U.S. Virgin 

 Islands 

General Motors 

Corporation

222,440 Delaware 200 13

Barbados (3)

Bermuda (2)

Cayman Islands (4)

Mauritius (1)

Netherlands Antilles (1)

U.S. Virgin Islands (2)

3 3

Barbados (1)

U.S. Virgin 

 Islands (2) 

Goodrich 

Corporation

308,283 New York 62 7

Barbados (2)

Cayman Islands (2)

Gibraltar (1)

Mauritius (1)

U.S. Virgin Islands (1)

3 2

Barbados (1)

U.S. Virgin 

 Islands (1)

Halliburton 

Company

534,177 Delaware 131 17

Cayman Islands (13)

Liechtenstein (2)

Panama (2)

0 0

Harris Corporation 389,970 Delaware 32 3

Bermuda (1)

Cayman Islands (1)

U.S. Virgin Islands (1)

1 1

U.S. Virgin 

 Islands 

Health Net, Inc. 944,618 Delaware 2 2

Bermuda (1)

Cayman Islands (1)

0 0

Hillenbrand 

Industries, Inc.

114,456 Indiana 27 2

Barbados (1)

Bermuda (1)

1 1

Barbados

Honeywell 

International, Inc.

1,442,018 Delaware 3

(Subsidiary 

information 

provided 

directly by 

corporation)

2

Barbados

3 2

Barbados

International 

Business Machine 

Corporation

498,656 New York 98 6

Bahamas (1)

Barbados (1)

Bermuda (2)

British Virgin Islands (2)

1 1

Barbados

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 21 GAO-04-293 Contractor Subsidiaries in Tax Havens

ITT Industries, Inc. 879,772 Indiana 142 3

Bermuda (1)

Cayman Islands (1)

U.S. Virgin Islands (1)

2 2

Bermuda (1)

U.S. Virgin 

 Islands (1)

Jacobs Engineering 

Group, Inc.

536,130 Delaware 48 5

Barbados (1)

Cyprus (1)

Panama (1)

U.S. Virgin Islands (2)

1 1

Barbados

L-3 Communications 

Holdings, Inc.

482,248 Delaware 45 3

U.S. Virgin Islands

3 3

U.S. Virgin 

 Islands

Lucent 

Technologies, Inc.

107,402 Delaware 93 3

Barbados (1)

Bermuda (1)

Cyprus (1)

1 1

Barbados

ManTech 

International 

Corporation

291,513 New Jersey 15 1

Panama

0 0

McDermott 

International, Inc.

1,885,243 Panama 10 9

Mauritius (1)

Netherlands Antilles (1)

Panama (7)

0 0

Northrop Grumman 

Corporationg

5,636,124 Delaware 52

(Subsidiary 

information 

provided 

directly by 

corporation)

2

Bermuda (1)

Cayman Islands (1)

1 0

Olin Corporation 104,121 Virginia 13 1

Bermuda

0 0

Oracle Corporation 212,468 Delaware 84 4

Cayman Islands (2)

Barbados (1)

Netherlands Antilles (1)

1 1

Barbados

Oshkosh Truck 

Corporation

566,511 Wisconsin 20 1

Barbados

0 0

The Procter & 

Gamble Company

224,212 Ohio 306 6

Barbados (2)

Bermuda (2)

British Virgin Islands (1)

Cayman Islands (1)

1 1

Barbados

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 22 GAO-04-293 Contractor Subsidiaries in Tax Havens

Raytheon Company 6,123,605 Delaware 95 4

Bermuda (1)

U.S. Virgin Islands (3)

1 1

U.S. Virgin 

 Islands 

Rolls-Royce plc 327,792 United 

Kingdom

 30h

(Subsidiary 

information 

obtained from 

annual report 

available on 

corporation’s 

Web site)

1

Guernsey

0 0

Science 

Applications 

International 

Corporation

2,654,492 Delaware 15 2

Barbados (1)

Bermuda (1)

0 0

Sprint Corporation 136,200 Kansas 56 3

Bermuda (1)

Cayman Islands (2)

0 0

Texas Instruments, 

Inc.

178,631 Delaware 51 7

Bahamas (1)

Barbados (3)

Bermuda (1)

Cayman Islands (1)

Panama (1)

3 3

Barbados 

Textron, Inc. 600,533 Delaware 19 1

Barbados 

1 1

Barbados

Titan Corporation 424,087 Delaware 4 3

Barbados (1)

Cayman Islands (1)

U.S. Virgin Islands (1)

0 0

TRW, Inc. 2,499,816 Ohio 33

(Subsidiary 

information 

provided 

directly by 

corporation)

2

Barbados (1)

Bermuda (1)

2 1

Barbados 

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 23 GAO-04-293 Contractor Subsidiaries in Tax Havens

Tyco International, 

Ltd.

206,387 Bermuda 1,736 115

Bahamas (8)

Barbados (17)

Belize (1)

Bermuda (55)

British Virgin Islands (3)

Cayman Islands (5)

Cyprus (3)

Gibraltar (5)

Isle of Man (1)

Jersey (2)

Marshall Islands (8)

Mauritius (3)

Panama (2)

U.S. Virgin Islands (2)

1 1

U.S. Virgin 

 Islands 

United Technologies 

Corporation

3,500,465 Delaware 66 4

Cayman Islands 

0 0

URS Corporation 262,489 Delaware 94 7

Bermuda (1)

Cayman Islands (1)

Cyprus (4)

Panama (1)

0 0

Valero Energy 

Corporation

310,202 Delaware 10 2

Bermuda

0 0

Verizon 

Communications, 

Inc.

207,210 Delaware 2 1

Bermuda

0 0

The Wackenhut 

Corporationi

356,968 Florida 47 3

Belize (1)

Panama (2)

0 0

Washington Group 

International

531,234 Delaware 35 1

Bermuda

0 0

WorldCom, Inc. 503,811 Georgia 187 10

Barbados (1)

Bermuda (3)

British Virgin Islands (1)

Cayman Islands (1)

Panama (4)

0 0

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Appendix IV

Federal Contractors that Report Having a 

Subsidiary in a Tax Haven Country

Page 24 GAO-04-293 Contractor Subsidiaries in Tax Havens

Sources: General Services Administration, Securities and Exchange Commission, corporate representatives, and GAO Internet research.

a

 Contract obligations include contracts with subsidiaries. 

b

 Includes foreign sales corporations. 

c Formerly Philip Morris Companies, Inc.

d FormerlyKPMG Consulting, Inc.

e Formerly Dell Computer Corporation.

f Subsidiary and Foreign Sales Corporation information does not include Veridian Corporation (or its 

subsidiaries), which General Dynamics acquired after fiscal year 2001. Information on Veridian 

Corporation and its subsidiaries are presented separately in this report.

g Subsidiary and Foreign Sales Corporation information does not include Newport News Shipbuilding 

or TRW, Inc. (or their subsidiaries), which Northrop Grumman acquired after fiscal year 2001. 

Information on Newport News Shipbuilding and TRW, Inc., and their subsidiaries are presented 

separately in this report.

h Rolls-Royce, plc also participates in 20 foreign joint ventures, including one joint venture incorporated 

in the tax haven country of Isle of Man.

i

 Acquired by Group 4 Falck (Denmark) in May 2002; does not include Wackenhut Corrections 

Corporation (or its subsidiaries), which is now an independent corporation.

Xerox Corporation 139,224 New York 216 24

Aruba (1)

Barbados (4)

Bermuda (10)

Cyprus (1)

Jersey (1)

Mauritius (1)

Netherlands Antilles (3)

Panama (2)

Turks & Caicos (1)

2 2

Barbados 

(Continued From Previous Page)

Company name

Federal 

contract 

obligations 

FY 2001 

(dollars in 

thousands)a

Incorporation 

location

Number 

of foreign 

subsidiariesb

Number and 

location(s) 

of foreign 

subsidiaries 

in tax havensb

Number of 

subsidiaries 

that are 

Foreign Sales 

Corporations

Number and 

location(s) of 

Foreign Sales 

Corporations in 

tax havens
Page 25 GAO-04-293 Contractor Subsidiaries in Tax Havens

Appendix V

GAO Contacts and Staff Acknowledgments ApendxiV

GAO Contacts James R. White, (202) 512-9110

Ralph T. Block, (415) 904-2150

Acknowledgments In addition to the individuals above, Jeff Arkin, Amy Friedheim, Shirley 

Jones, Amy Rosewarne, and Jennifer Wong made key contributions to this 

report.

(450245)
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