In connection with its jurisdiction over biomedical research and development at higher education institutions, the House Committee on Energy and Commerce's Subcommittee on Oversight and Investigations met a second time to hear testimony on abuses in the indirect cost recovery practices at universities for federal research grants and contracts. The first meeting revealed extensive financial abuses at universities and ineffective oversight by the Navy. This meeting further examined the indirect cost abuses and sought testimony on why universities negotiate for top dollar when dealing with the American taxpayer, but give preferable treatment to foreign governments and others. It also examined the status of the actions taken to prevent these abuses and bolster the partnership between the Federal Government and universities in stimulating research. Testimony and prepared statements were delivered by Joseph S. Cohen, Audit Manager, General Accounting Office (GAO); Doreen S. Eng, Senior Evaluator, GAO; Rear Admiral William C. Miller, Chief, Office of Naval Research, U.S. Navy; Fred J. Newton, Deputy Director, Defense Contract Audit Agency; Richard Ogden, Regional Inspector General for Audit Services, Department of Health and Human Services (HHS); J. Dexter Peach, Assistant Comptroller General, GAO; Thomas D. Roslewicz, Inspector General for Audit Services, (HHS); and Gary M. Talesnik, Director, Office of Grant and Contract Financial Management, HHS. (GLR)