GAO found that in the Army estimated undercharges for training foreign students totaled $18.7 million in fiscal year 1975. In the Air Force, about $11.7 million in foreign training costs incurred during 1975 were not recovered. Further, the Navy did not charge for about $2.7 million in costs, and the Marine Corps did not charge for training valued at $252,000. GAO recommended that the Secretary of Defense direct the military services to attempt recovery of amounts which should have been included in tuition rates billed foreign countries. It was determined that pricing problems had arisen because the Department of Defense had not provided adequate pricing guidance to the military services. Consequently, on November 5, 1975, the Department of Defense, reacting to congressional and GAO concern over the pricing of foreign training, specified the cost elements to be included when establishing prices for training courses. However, despite objections, the Department of Defense issued guidance to reduce tuition rates effective October 1, 1976. GAO recommended that the Department rescind the decision to reduce tuition rates and that each of the military services take action to improve procedures for accounting, billing, collecting, and depositing receipts. The military services have complied with the recommendation. Tables are included. Appendixes provide relevant correspondence and summaries of GAO reports. (Author abstract modified).