PAP.2.13.100 Instructions of Operating an Established Inventory System

(a) Acquisition. Property items may be acquired by purchase or donation. The following procedures shall be used to incorporate items that are acquired subsequent to the initial inventory.

(1) Obtain a complete purchase order and invoice copy from purchasing;

(2) Prepare an "Addition of Property Inventory" form for each item;

(3) Assign and affix an identification tag, or use the serial number or VIN number if tagging is not appropriate, to each new item as soon as it is received;

(4) Enter the information for the "Addition of Property Inventory" form onto the data base; and

(5) File the "Addition of Property Inventory" form, along with a copy of the purchase order and a copy of the invoice to the property management file by department. These documents may be scanned and filed electronically.

(b) Disposition. When a property item is disposed of by trade-in, the following procedures apply:

(1) Obtain a complete "Property Disposition Authorization" form from the custodian;

(2) Remove the asset record from the active file. If funding source notification is required, the Chief Procurement Officer will be responsible for this notification requirement;

(3) Remove identification tag from equipment and destroy tag. Identification numbers used once should not be used again;

(4) Make the appropriate entry in the asset record, next to the listing for the equipment that is being disposed of; and

(5) Remove equipment from "Property Register."

(1) Property that is destroyed, lost or stolen shall be reported to the accounting office by the person responsible for the location unit as soon as the destruction occurs or the loss is discovered;

(2) The Chief Procurement Officer will report this event to the funding source if required, and notify the insurance carrier if the property is insured;

(3) A "Property Disposition Authorization" form shall be completed along with a complete explanation of the circumstances; and

(4) Follow procedure for disposition as outlined above.

(d) Sales of Property.

(1) The custodian determines if property is no longer necessary, not appropriate for trade-in, or transfer and has residual value. The Department Director must approve the property for sale;

(2) Funding source grant awards are reviewed to determine how the proceeds from the sale are to be used. This should insure compliance with the grant provisions;

(3) Property determined to be sold, will be sold on bids. The property will be properly described and bids encouraged. Bid notices will be published in the tribal newspaper and placed on the tribe's website, and local postings on the Tribal office bulletin board. The bids will all be channeled to the Chief Procurement Officer or the appropriate department's property custodian. The bid process should be completed in two weeks. The highest bid will be accepted. Title and property will not transfer until payment is received in full by form of money order or cashier's check.

(e) Physical Inventories. A physical inventory of equipment shall be made at a minimum of once every two years. Physical inventories shall be reconciled to the "Property Register" and the general ledger biennially by the accounting office.

(1) The individual taking the physical inventory shall list all items at a given location of the "Property Inventory Data Sheet." The tag number, condition, quantity and a brief description shall be listed for each item.

(2) Items without identification numbers shall be described in detail on the "Property Inventory Data Sheet" unless the item is clearly labeled as personal property of an employee or the item is rented or borrowed. Personal property, rented or borrowed items should be disclosed to the Chief Procurement Officer.

(3) Personal property inventory will be stored in a distinct and separate file by employee name, department, location, and personal property listed.

(4) The "Property Register," by location, shall be reconciled to the "Property Inventory Data Sheets" by checking the data sheets against the number and descriptions shown on the "Property Register."

(5) The accounting office shall personally conduct a physical check of any items which were not previously recorded and take appropriate action as follows:

(A) If it was determined that an item was missed during the taking of the inventory, that item shall be added to the "Property Inventory Data Sheets;"

(B) If it is established that the identification tag previously assigned has become lost, a new identification number shall be assigned and a new tag attached to the item. The new number shall be shown on the original "Property Inventory Data Sheet" and recorded on the "Addition of Property Inventory" form. A line shall be drawn through the original number and the reason for the change shall be noted on the data sheet;

(C) Missing property, unresolved differences between the custodian and the Chief Procurement Officer, must be resolved. The property is the responsibility of the custodian. Any authorizations for the disposal of missing property must be executed by the Chief Procurement Officer; or

(D) The Chief Procurement Officer can make unannounced inventory checks to determine compliance with these procedures.

(6) Ownership of items classified as property must be established. Those items acquired since the previous inventory, but not recorded, shall be recorded the same as the original acquisition.

(7) A thorough check of all location units and organization records shall be made before reporting items of property missing at the time of the inventory. A report of all items lost, missing, or stolen subsequent to the previous inventory shall be prepared and submitted to the Chief Procurement Officer by the Department Director and shall include the following:

(A) Identification number;

(B) Description of the item;

(D) Unit value; and

(E) Total value of all items listed.

(f) Information Gathering and Communication. In order to maintain accurate and up to date information in the data base, it is essential that information be gathered efficiently and that communications be open and consistent with purchasing and the equipment custodians. The following steps should be taken by the Chief Procurement Officer to achieve this purpose:

(1) Send a copy of the "Property Register," by location, to the Department Director each quarter for review. Request the department list. Also, ask them to list any items that have been purchased that do not appear on the list. Stress to them the importance of the "Property Register" being current. Inform them that this information is used to make sure that all of their program's property is adequately insured and that their program is not paying insurance for equipment that is no longer in service.

(2) Request that all vendors send their invoices directly to accounting and not to a satellite office or some other location.

(3) Inquire of the Accounts Payable Manager weekly as to whether there were any purchase orders issued for property purchases or payments made for property purchased. If there are, check the "Property Register" to determine if the property is in the system. If it is not, set up property records for these items.