BUSINESS & FINANCE
|There are attachments for this policy that can be perused in the dean's office.|
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:
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:
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.
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.
(2) Resp. Dept. - Enter the responsible department inventory number by showing the agency, ledger and departmental account number.
(3) Project - This space is reserved for use by Agricultural Experiment Station, Federal Extension Service, International Programs, and government furnished property, where appropriate.
(4) Sub Code - This space is for departmental use only and can be used to indicate sub-departments within a department.
(5) Acquisition - The department is to use this space to indicate the month, day and year in which the equipment was received. (Example: June 1, 1982 will be shown as 06 01 82)
(6) Serial No., Item Description & Mfg'r - The department is to use this space to enter in the following sequence: The serial number, the item description, the manufacturer, and the model number, if enough space remains. This information should be entered exactly as the department wants it to appear on the inventory listing. Only 50 spaces are available in the computer print-out format to accept this information.
(7) Bldg. - The department is to place in this space the building code number and the building in which the equipment is located. Building code charts are available from the Inventory Section.
(8) Room - The department is to enter the room number where the equipment is to be located.
c. The department head accepting responsibility and accountability for the equipment is required to sign the certification in the space provided at the time equipment is tagged by the Inventory Section.
4.05 Procedures for equipment acquired by donation through the OSU Foundation shall be as follows:
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.
4.07 Other equipment removal situations are to be handled in the following manner:
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.
4.09 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:
b. All motor vehicles and aircraft, regardless of value
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