Building a Chemical Industry Management System ?
1.01 The Inventory Section maintains the necessary records to
produce a current inventory of all movable
equipment for which the University is accountable. Each item is appropriately
marked and coded to be readily identified and located with ease.
1.02 The Inventory Section is administered by the Property
Coordinator, whose line of administrative responsibility is through the Business
Manager to the Vice President for Business and Finance.
PURPOSE AND SCOPE
2.01 The purpose of the Inventory Section is to establish and maintain a
current inventory of movable equipment in
custody of the University, including the item nomenclature, location of each
item in the inventory, the original cost of the
item, and the source of funding used to purchase the item.
2.02 An item shall be classified as an
equipment inventory item if it has a useful life
of five years or more with an acquisition cost of at least $250 and is a
complete and independent item which does not lose its identity or become a
component part of another item.
2.03 Vehicles, including farm tractors and
aircraft, are to be placed on the equipment inventory regardless of acquisition value.
2.04 Contractual agreements governing some
grant or contract funds and acquisitions from federal or state excess property
pools require equipment items not meeting the University's definition of
equipment to be held as accountable property. In these instances, the agreement
conditions prevail over OSU policy. By reference, Policy and Procedures Letter
3-0127, Federal Property Management Standards, is made an integral part of this
policy and procedures letter.
UNIVERSITY POLICY AND STATE
LAW
3.01 This policy has been established to
assign the department head the responsibility and accountability for movable
equipment purchased by or assigned to a department and forms the basic principle
of the inventory system. It is essential that
all employees recognize the concept of institutional ownership and
accountability with departmental responsibility.
3.02 Transfer of movable equipment shall
not be made from building to building or from department to department within
the same building without reporting such activity to the Inventory Section. Transferring equipment from
department to department shall require completion of a Movable Equipment Inventory Change Request form (Exhibit 1) to transfer
accountability to the new responsible department. Equipment location may be
updated by a memo signed by the department head.
3.03 As a state-supported institution, the
University is required to conform with State Law, Title 74, Section 110,
Paragraph 1 (as amended June, 1986), which is quoted as follows:
"The State Board of Public Affairs shall
maintain a current inventory of all equipment
owned by state departments, boards, commissions, institutions or agencies of the
state excepting equipment used in medical education and research costing less
than Two Hundred Fifty Dollars ($250). The State Board of Public Affairs inventory shall consist of machinery, implements,
tools, furniture, livestock, vehicles, and other apparatus that may be used
repeatedly without material impairment of its physical condition and which has a
calculable period of service and a value of over Two Hundred Fifty Dollars
($250). The State Board of Public Affairs shall cause all such articles to be
properly coded, tagged or marked in such a manner that they may be readily
identified as property of the State of Oklahoma and that records may be
maintained thereof. All state departments, boards, commissions, institutions, or
agencies of the State of Oklahoma will make available to the State Board of
Public Affairs support personnel to check inventories."
3.04 Equipment procured with OSU Foundation funds or
donated to the OSU Foundation or to the University for its use and benefit is
accountable property provided that the criterion set forth in Paragraph 2.02 are
met. The Foundation shall establish a fair market value (acquisition value) for
each item which is received as a gift. The acquisition value for gifts to the
University shall be established by the administrator(s) of the receiving
division(s) or unit(s), subject to review by the Business Manager's Office.
Notification of gifts shall be submitted to the Inventory Section by the Foundation in a timely
manner.
3.05 Department heads shall take, or cause
to be taken, a biennial physical inventory of
all equipment for which he/she is accountable (Exhibit 2). There is no provision
for waiver of the biennial inventory
requirement.
3.06 Oklahoma Session Law, 1949, Page 419,
Section 3, reads in part:
"In connection with every cash sale of
state equipment, for the purpose stated in this Act, the Business Manager's
Office shall publicly advertise the sale of equipment or secure at least three
(3) bids in writing. The record of sale, including the bids received shall be
considered a matter of public record and shall be maintained for a period of not
less than ten (10) years."
3.07 Selling, trading, or deleting from inventory any item of University-owned or non-owned
equipment is not within a department head's authority. This responsibility and
authority has been assigned specifically to the Business Manager's Office. This
policy also applies to the disposal of scrap, salvage, broken or obsolete
equipment, and surplus supplies.
3.08 Policy and Procedures Letter 3-0126,
Disposition of Surplus Property, explicates University policy for disposal and
handling of surplus, inoperative, or obsolete equipment. This policy statement
also defines the requirement for handling excess or salvage materials and
supplies.
3.09 When changes occur in department
heads, the outgoing department head is responsible for informing the incoming
department head of his/her responsibility and accountability for equipment in
custody of the department. If time permits, a physical inventory should be conducted verifying the presence
of the items on the inventory listing. The
outgoing department head should get a receipt from the incoming department head
acknowledging transfer of equipment responsibility and accountability.
3.10 The use of University equipment by
individuals or organizations for activities not directly connected with the
University is prohibited. University-owned or controlled equipment shall not be
removed from the University premises except in cases where such equipment is to
be used in the line of official duty.
3.11 The use of University vehicles is
restricted to official University business.
PROCEDURES
4.01 The department head is responsible for
all equipment purchased for or assigned to the department and shall promptly
report any acquisition, transfer, or loss of equipment to the Inventory Section.
4.02 Stolen equipment should be reported to
the OSU Police at once. A Movable Equipment Inventory Change Request (ICR) form should be
completed and submitted to the Inventory Section
to update the equipment data base. A copy of the Police report detailing the
theft should accompany the completed MEICR form.
4.03 Purchase of inventory items is the most common method of
acquisition. When a purchase is made and the equipment is received, the item is
to be reported on the ICR form (Exhibit 1.) This form originates in the Inventory Section. The Inventory Section is responsible for entering the
requisition number, vendor, and acquisition code (A1-Purchase) from the payment
processed by the Accounting Section.
4.04 Acquisition of inventory items may be secured by construction, gift,
transfer or "other." Each department head must report such transactions to the
Inventory Section by filing a ICR form. If the
inventory items are acquired by construction,
gift or "other," the inventory change request
form is to be initiated by the acquiring department. This form is to be
completed in the same manner as for acquisition of inventory equipment by purchase, with the exception
being that the acquiring department is to fill in the acquisition code
applicable to the acquisition in the column titled "AC." The completed form is
to be submitted to the Inventory Section. The
blue copy is to be retained by the department. The yellow copy will be left with
the department when the equipment is tagged. The addition of equipment by
transfer reporting procedure is explained in paragraph 4.06a.
4.05 Procedures for equipment acquired by
donation through the OSU Foundation shall be as follows:
a. Upon receiving notification of donated
equipment from the OSU Foundation, as detailed in paragraph 3.04, the donated
items shall be reviewed for compliance with the University's definition of
equipment contained in paragraph 2.02.
b. Based on information provided by the OSU
Foundation, a ICR form shall be generated by the Inventory Section to add donated items meeting the
definition of movable equipment. The ICR form shall be coded with an owner code
of "0231" indicating donated, restricted University equipment.
c. A letter (Exhibit 3) shall be sent to
advise the responsible department head of the notification of donated equipment
as well as the IRS rule which requires the University to hold donated items
valued at $5,000 or more for two years from the date of receipt (IRS Reg.
1.170A-13T Section 6050L) before being released from IRS reporting requirements.
A copy of this letter shall be maintained in the Inventory Section responsible department file.
d. The donated equipment shall be tagged
and placed on OSU movable equipment inventory by
the Inventory Section.
e. Any property released for disposition by
a department will be reviewed to determine if it was donated to the University.
This review will key on the owner code explained in Section b above for items
donated after February, 1998. For items acquired prior to February, 1988, a
search of information available to the Inventory
Section shall be made to determine if the items were donated.
f. A letter (Exhibit 4) will be sent to the
OSU Foundation advising them of the disposition request for any equipment item
coded 0231.
g. Should there be no response to the
notification in Section e above by the stated cutoff date, the Inventory Section will proceed with the disposition of
the property in accordance with University policy as detailed in OSU Policy and
Procedures Letter 3-0126, Disposition of Surplus Property.
h. The Inventory Section will make a periodic review of
equipment carrying the "0231" owner code to ensure the coding is correct. Items
donated more than two years previously will be updated to indicate owner code
"0131." Code "0131" will identify donated equipment which the University can
dispose of without IRS penalty to the donor.
i. Should there be restrictive covenants
set at the time of donation of equipment not covered herein, the OSU Foundation
shall notify the Inventory Section of the
restrictions at the same time that notification of donated equipment is sent to
the Inventory Section. The restrictive equipment
shall be maintained on file by the Inventory
Section. Such equipment shall carry the "0231" restrictive owner code in
accordance with the restrictive covenants rather than the limitations stated in
Section h above.
4.06
Removal of items from the inventory lists may be
requested by notifying the Inventory Section
through use of the ICR or by the Report of Surplus, Obsolete or Junk Property
for Disposal form (Exhibit 5). All forms indicating removal because of loss or
theft must be authorized by the department head. Inventory change requests for removal of items due to
theft or loss with an aggregate acquisition value of $5,000 or more must be
authorized by the college dean. If the removal request originates in a division
or department that does not have a dean, removal must be author-ized by the
appropriate vice president.
4.07 Other equipment removal situations are
to be handled in the following manner:
a. Interdepartmental Transfer - The
interdepartmental transfer code A5 is used by the department to indicate that
removal is due to transfer to another department. Removal by transfer to another
department is shown in the addition section of the change request because the
equipment is actually being added to another department. There is no need to
show the removal by transfer in the removal section. The inventory number and item description, etc. are to be
completed by the department originating the transfer. The change request form is
to be signed by the department head. The department retains the blue copy and
transmits the remaining copies to the receiving department. On the receipt of
the change request form, the receiving department is to enter the responsible
agency, department, project, subcode, building and room number in the spaces
provided. The receiving department head is to sign the change request form
accepting responsibility and accountability. The department retains the yellow
copy and transmits all remaining copies to the Inventory Section, which will update the master inventory file.
b. Trade-In - If an item is used as a
"trade-in" on new equipment, the inventory tag
is to be removed and attached to the ICR form. Use the trade-in code R6 in the
"RC" column and, by exception, use the shaded area marked "requisition" to
provide the Inventory Section with the
requisition number of the new equipment on which the old item was used as a
trade-in. Place the inventory number and item
description in the appropriate columns for item traded-in in the removal
section. The department head is to sign the form indicating request for release
of responsibility and accountability. The department keeps the yellow copy of
the change request and transmits the remaining copies to the Inventory Section. The new item will be tagged after
notification of payment for the new equipment has been received (from the
Accounting Section) in the Inventory
Section.
c. Returned to Title Holder - If the
removal occurs by returning the equipment to the title holder (an agency other
than the University), the code R7-Returned to Title Holder is to be used and an
explanation entered in the space provided. The inventory number and description is to be shown and
the form signed by the department head. (In certain areas, the dean's signature
is required.) The metal inventory tag is to be
removed by the department and attached to the Movable Equipment Inventory Change Request. The yellow copy can be
retained by the department, with all other copies transmitted to the Inventory Section.
4.08 Any equipment that is classed as
R4-Surplus-Operative or R5-Salvage is to be moved to the surplus warehouse. The
surplus warehouse manager will decide on the removal code to be used. The inventory number and the item's description are to be
indicated in the removal section of the change request. Also, the condition of
the item, estimated market value and reason for disposition should be listed as
well as a contact person to assist in the efficient pickup of surplus items by
personnel of the surplus warehouse. The Inventory Section will contact the surplus warehouse
for equipment pick-up after the Board of Regents has approved the requested
disposition.
4.09 Under no circumstances should any
equipment be thrown away. Any excep-tion to this will be decided by the Inventory Section.
4.10 Purchases of equipment from the
Oklahoma State Agency for Surplus Property require special care in reporting.
The following criteria is to be used in selecting which items are to be included
in the inventory system:
4.11
Inventory records on items procured from surplus
property will be main-tained in the same manner as other property in the custody
of the University.
4.12 A complete listing of inventory items will be sent to each department head
at fiscal year-end.
4.13 All departments, without exception,
are required to conduct a biennial physical count of inventory using an inventory listing as a guide. Any differences between
the listing and the actual physical count must be reported to the Inventory Section. Certification of biennial inventory is required. The Inventory Verification Report is attached as Exhibit
2.
4.14 Inventory Verification Reports must be completed and
returned to the Inventory Section no later than
the due date stated in the letter accompanying the blank Verification Report and
detail inventory listing. Departments are
allowed approximately ten weeks from the time the Inventory Section distributes information to complete
the Verification Report.
4.15 Departmental equipment inventory will be annually tested for compliance with
state law and University policy by the Department of Internal Audits.
Revised: November 1983
September 1987
May 1989
October
1989
July 1990
