THE UNIVERSITY OF NORTH CAROLINA AT  CHAPEL HILL
Associate Vice Chancellor for Finance		CB# 1000, 304 South Building The University of North Carolina at Chapel Hill Chapel Hill, NC 27599-1000
	February 22, 2000

While none of us look forward to the time consuming and sometimes frustrating annual inventory process, we must comply with federal and state requirements. In the past, the University has been cited by State and Internal Auditors for weaknesses in our equipment control procedures. We have taken steps to correct these weaknesses in order to improve the University's stewardship and to protect the University from public criticism.

Equipment with a value of $5,000 or more must be recorded on the University inventory file until it is transferred to surplus or scrapped for parts. When an item is scrapped, an E/S-102 form should be completed with the University decal attached to the form. Equipment inventory items not being used by your department may be sent to surplus, traded-in, or scrapped for parts by following the policies and procedure outlined in the University Business Manual. Please refer to the Asset Management Section (Policy 8) and Materials Support (MSD Policies 30 and 52) and also MSD Procedure 12 (University Surplus Property).

All requests to transfer property to another state agency, regardless of funding source, must be approved by the State Surplus Department in Raleigh. State regulations require the receiving agency to reimburse the transferring agency for the current fair market value of the equipment; however, the proceeds must be deposited to a designated account which reverts to the State unless the department intends to use the proceeds to replace the items being transferred. Inter-departmental sales, within the University, will continue to be treated as expense refunds. Please refer to the University Business Manual, Asset Management Section (Policies 6 and 7).

A department may request that University-titled equipment acquired under a federally sponsored project be transferred to another educational institution to which the Principal Investigator on the project is relocating. In order to qualify, the project must be active or within 120 days following its termination. Please refer questions relating to transfers of equipment purchased from non-federally sponsored projects to the Office of Contracts and Grants since policies vary between granting agencies. All requests for transfers of property, regardless of cost, should be submitted in writing to Candace Woody, Director, Asset Management, CB# 1070.
The Asset Management department is assigned responsibility for ensuring that the annual equipment inventory is accurate and timely, and that appropriate efforts are made to locate missing equipment items. The University is implementing a more rigorous follow-up procedure for locating items reported missing on annual department and/or building equipment audits. A revision to the procedure is as follows:

I ) A department having items of equipment missing during the annual inventory will be given 90 days to locate the items.

2) If the items are still missing after 90 days, Asset Management will send a report to the appropriate dean or director and copy the Associate Vice Chancellor of Finance. The dean will be requested to respond within 30 days. (Please note: the current paper report will be sent as an email attachment when programming has been completed.)

3) If, after 180 days, items are still missing, a second report will be sent to the appropriate vice chancellor and copy the Associate Vice Chancellor of Finance. The vice chancellor will be requested to respond within 30 days.

4) If items are still missing after 2 10 days, Asset Management will consult with the Associate Vice Chancellor of Finance to determine appropriate steps to be taken based on the individual circumstances, including: contacting the Public Safety Department, filing a misuse report, on-site audit, or awarding additional time to locate items. University disciplinary action will be taken when appropriate.

5) In addition to the above, Asset Management will conduct random audits to test the validity of the annual reports and located missing items submitted by departments.

Departments must take seriously their responsibility for safeguarding and accounting for University assets purchased by and/or assigned to them. Departments should report misuse or thefts of equipment to the Department of Public Safety as soon as the misuse or theft becomes know. If your department needs further information, assistance, or training with regard to asset accounting responsibilities, please contact Candace Woody, Director of Asset Management, at 2-1382 or 2-6267 or access the information available on the Asset Management web site http://www.unc.edu/depts/finance/asset/.  Your cooperation is essential.