There are nearly innumerable moving parts (literally) in a public school system. A very labor- and time-intensive processes for many districts is keeping an up-to-date and accurate record of additions of new assets, transfers of assets between locations, and deletions of surplus assets. The month of May is an ideal time to distribute the workload by having select staff take inventory of controlled items in located on campuses and departments. The month of May is ideal because you need to be able to ask questions about items that cannot located before the majority of employees depart at the end of the school year.
Key controls include:
- Tagging fixed (capital) assets and controlled inventoried items promptly after purchase and receipt by the district
- Promptly notifying the district’s fixed asset specialist when fixed assets or inventoried items are received at locations other than central receiving
- Identification of fixed assets and inventoried items purchased with federal funds and segregating the items for purposes approved in grant applications
- Recording property transfers and movements from any location in the district
- Recording surplus items approved for disposal that have reached “end-of-useful-life”
- Contacting the grantor agency for directions on disposal of grant-funded fixed assets and inventoried items, in accordance with applicable grant application terms and federal regulations
- Prohibiting discarding items at the campus or department level
- Conducting public auctions of surplus items
- Monitoring approved off-district or off-campus personal use of district’s fixed assets and inventoried items, in accordance with the district’s policies and procedures
- Requiring completion of custody receipts for approved off-district or off-campus use of assets and check-in when items are returned
- Maintaining a complete inventory record for each grant-funded item, in accordance with applicable federal regulations
- Recording lost, stolen or destroyed items
- Reporting stolen items promptly (before they are sold at local pawn shops)
- Conducting an inventory of items assigned to employees that terminate their employment prior to their last day of service, when practical
- Conducting annual campus and department inventories
- Testing campus and departmental inventories periodically on a year-round basis
School officials are increasing turning to technology solutions for controlling capital and inventoried assets. Advances in technology solutions now provide simple and low-cost solutions for effective monitoring, management and inventories of assets. Knowing where the district’s assets are deployed or located will also contribute to more effective instructional program management. You need more than a basic spreadsheet.
Things can spiral out of control very quickly if staff fall behind that may be associated with a multitude of internal control issues that are certain to arise. Among the reasons to stay current are to facilitate prompt detection of potentially stolen assets, in addition to monitoring appropriate use of grant-funded assets to avoid substantial financial penalties. If your district is having difficulty in this area, it’s time to consider installing a more advanced interactive software tool that can assessed by all campuses and departments, in addition to considering arranging for additional training and a management review to help accelerate the district’s path to catching up and implementing best practices.
Terminology
Most districts define a fixed or capital asset as: an asset acquired by purchase, construction, or donation that is tangible in nature; had an acquisition cost of $5,000 or more ($5,000 or more fair market value for donated items); and has a useful life in excess of one year. Inventoried items are defined as: items with a value between $1,000 and $4,999 that were acquired by purchase or donation. The cost should include ancillary charges necessary to place the asset into its intended location and condition for use. Ancillary costs include costs that are directly attributable to asset acquisition—such as freight and transportation charges, site preparation costs, and professional fees.