Why Must You Have Physical Inventories

Physical Inventories

What is a review campaign?

A review campaign is the actual counting and recording of a particular set of personal property.

What is a physical inventory?

A physical inventory is the actual sighting, counting and recording of all accountable and sensitive non-expendable personal property that NOAA or any other Federal agency possesses.

Why is a physical inventory important?

A physical inventory is important because it determines the completeness and accuracy of the personal property records and the financial accounts. It reconciles and adjusts the accountability records with the general ledger control accounts and reconciles and adjusts the accountability records with the custodial records. It ensures that personal property and financial records are reconciled with the actual property. Property records and related financial records must match the property on hand. The objectives of the physical inventory are:

  • determining the useful life of the property;
  • determining the property's present physical condition;
  • projecting future equipment needs, and
  • validating the effectiveness of equipment accountability and control procedures and operations.

What personal property needs to be accounted for?

The types of personal property that needs to be accounted for are all non-expendable personal property with an original acquisition cost of $5,000 or more and all sensitive non-expendable personal property regardless of its cost.

How often are inventories conducted?

Department of Commerce and NOAA conduct their inventories once a year. Refer to the Calendar of Inventories due to the PMO located on the NOAA Personal Property Web site.

Under what special circumstances are additional inventories conducted?

If a Property Custodian must leave or give up their duties, a joint inventory must be conducted with the replacement present in order to ensure that everything is in order. In addition, the Property Custodian, the Property Accountability Officer or the Property Management Officer may call for a special physical inventory at any time.

How is the inventory conducted?

physical-inventory

Prior to the inventory, the Property Custodian should become familiar with the scope of the inventory; the definition of items which are accountable. Define the physical boundaries of the inventory; identify any organizational boundaries on a floor plan. Property Custodians should use the Review Campaign Base Asset Report as a list of accountable items (Sorted by barcode number.) If you use room numbers, a second report sorted by location is very useful in identifying items of interest. Property Custodians will conduct a physical sweep of the organization’s area and barcode scan each sighted barcode or annotate the list with all barcodes sighted that were not on the list. All off-site equipment that can be moved (e.g. computers, PDAs, etc.) will be brought on-site for existence verification, and, if necessary, installation of security updates, etc. Property Custodian will use DOC Hand Receipts and the Sunflower Current User Field to monitor accountable personal property maintained both on and off site. Property Custodian will reconcile the DOC Hand Receipts Report for accuracy. The Property Custodian will maintain a copy of DOC Hand Receipt signed by the Current User for each asset.

How long does a Property Custodian have to complete the inventory?

The Property Custodian will be notified prior to the beginning of the process and has 30 days to complete and return the inventory.

1 Response

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