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Section 14: Property and Equipment Management and Control

Capital Asset Property Accounting

Effective Date:

04/21/10

Approved By:

Lenora Chapman, Associate Vice President, Financial Affairs

Last Revised On:

05/01/2014

For Assistance Contact:

Inventory Manager
(210) 458-4844
UTSA’s Designated Property Manager
(210) 458-4224

PURPOSE/SCOPE

This guideline provides information about current State of Texas laws and University of Texas rules, regulations and procedures for the proper acquisition and accounting of University property.

For information regarding safeguarding and disposing of UTSA property, see FMOG - Administration and Management of Capital Assets and Controlled Property.

AUTHORITY


UNIVERSITY GUIDELINES

Table of Contents

A. Proper Use of University Property

University equipment should not be used for personal gain or in competition with private enterprise. Regulations regarding proper use of university/state property by university employees are included in the University of Texas Regents' Rules and Regulations. Series 80101of the Regent’s Rules and Regulations include the following statement:

Sec. 2
Authorized Users. No person, organization, group, association, or corporation may use property or buildings owned or controlled by the U. T. System or any of its institutions for any purpose other than in the course of the regular programs or activities related to the role and mission of the U. T. System and its institutions, unless authorized by the Regents' Rules and Regulations. Any authorized use must be conducted in compliance with the provisions of the Regents' Rules and Regulations, the approved rules and regulations of the institution, and applicable federal, State, and local laws and regulations.

B. Capitalized Property

Any equipment, other than software purchased on 09/01/09 or later, with a unit cost of $5,000 or more is considered ‘capitalized equipment’ and is recorded on the University inventory. Software purchased on and after 9/01/2009 must have a cost of $100,000 to be considered capital. Freight and installation charges, if any, are considered part of the landed cost of the item. All such items are assigned University inventory numbers, and a barcode shall be affixed to each item indicating it is the property of the UTSA.

If an item costing less than $5,000 is intended to be incorporated into an existing inventory item, it will be added to the inventory listing using the same number as the original item, but the inventory value will be increased accordingly.

All equipment with a unit cost of less than $5,000 other than Controlled Property (see below) is considered to be 'non-capitalized property’ but still constitute University property and shall be properly used, maintained, and protected.

C. Controlled Property

In accordance with State Comptroller’s policy, controlled items are individually tagged and listed on the UTSA's inventory but are not considered as capitalized items.

Controlled Items ($500 to $4,999.99):

  • Stereo Systems

  • Cameras / Video Recorders

  • Computers

  • Data Projectors

  • TV/VCR/Camcorder/Laserdisk Player

Controlled Items (at any cost):

  • Guns: handguns, rifles, automatic weapons, shotguns

  • Artwork

D. Roles and Responsibilities

Each State of Texas agency is responsible for ensuring that property is tracked and secured in a manner that is most likely to prevent theft, loss, damage or misuse. Precautions must be taken to ensure that state property is secured. Agencies must know at all times where all property under their control is located, should have a method for locating any inventory item on-site or off-site and should be able to locate a given item upon request. At any time, the Inventory Department and external / internal auditors may perform a physical inventory of property items.

The President of The University of Texas at San Antonio is responsible for property in possession of the University.

The Director of Financial Services and University Bursar has been designated by the President as the Property Manager as required for each state agency. The Property Manager is responsible for property records which are maintained by the Inventory Department

The Assistant Director Financial Services and University Bursar reports to the Property Manager and is responsible for the management and direction of the  UTSA Inventory Department,  Surplus Department, Fiscal Services-Collections, and Financial Services and is responsible for recording and tracking all capitalized and controlled equipment.  Serves as the Alternate Property Manager for all capital inventory equipment.

The Inventory Manager reports to the Assistant Director Financial Services and University Bursar, and is responsible for the daily operations and supervision of the UTSA Inventory Department and staff and ensures UTSA and departmental compliance with all property rules, regulations and policies.

The Surplus Property Supervisor reports to the Assistant Director Financial Services and University Bursar, and is responsible for the daily management, activities and supervision of the UTSA Surplus Property Department and staff.

The Inventory Department provides information to all UTSA personnel regarding current state laws and UTSA rules, regulations, and procedures that must be followed in using, safeguarding, and disposing of University property. The Inventory department administers the annual inventory process and is responsible for all property reporting.

The Vice President for Business Affairs is required by the Board of Regents rules to facilitate an annual inventory as discussed elsewhere in this guideline.

Department/Division heads are responsible for the day-to-day care and accountability of property and are further responsible to ensure that the annual physical inventory of UTSA property assigned to their department is completed each year. This responsibility may not be delegated and is the duty of the Department/Division Head to see that all members of their staff take every reasonable precaution to prevent loss of or damage to UTSA property while it is in their possession or students' possession under their direct supervision. Department/Division Heads are responsible for insuring that the department's/division's inventory is maintained in accordance with University and State policies. For more information, see FMOG - Administration and Management of Capital Assets & Controlled Property.

All Department/Division Heads should emphasize, to all members of their staff, the importance of vigilance to prevent loss of or damage to UTSA property and in identifying those responsible for such damage whenever it occurs.

Ideally, inventory records are maintained by one person within the department to assure compliance with requirements.

E. Departmental Audits

The UTSA Inventory Department and the Office of Internal Audit may conduct departmental audits throughout the year that will include the testing of fixed asset controls. To facilitate these audits, it is recommended that the departments/divisions have the following documentation in their possession:

  • Copy of department's/division's most recent physical Inventory

  • Missing/Stolen Property, Equipment or Inventory Reports

  • Campus Police Incident Reports

  • Correspondence to Inventory Department

  • Inventory Transfer Documentation

  • Surplus Documentation

  • Removal of Equipment Forms

  • Departmental logs for equipment taken off campus.

F. Inventory Record System

The PeopleSoft system is used by the Inventory Department to record and maintain the capital/controlled equipment inventory. The system provides the ability to add and delete property items to the departmental inventory.

Departmental personnel with access to PeopleSoft are also required to use the PeopleSoft system to change the location of property items assigned and to assign responsibility for property using the employee’s PeopleSoft Employee ID (EmplID). Other than those updates, only the Inventory department staff is authorized access to change inventory data in PeopleSoft.

Departmental staff needing access to these functions should request access from the PeopleSoft Support and Sustainment Center.

G. Inventory Carrying Values

The acquisition cost of a property item remains the same as long as the item is carried on the University inventory. Department personnel should always reference the acquisition cost of an item on forms and in correspondence requiring the inventory value, not the depreciated or current value.

H. Acquisition of University Property

Property items are acquired by the University through various means as described herein.

1. Purchases

All equipment purchased with university funds are the property of the UTSA. Likewise, items purchased with '26' accounts from grants and contract funding become UTSA property upon acquisition unless the contract specifically stipulates otherwise.

The Inventory Department reviews purchase orders, payment vouchers, and Interdepartmental Transfers (IDTs) for identification of all equipment purchases. If the purchase is for capital equipment or controlled items, an inventory number is assigned for each equipment item and the Inventory Department uses the Purchase Order and voucher for entering the item on the UTSA's computerized inventory system.

Equipment that is purchased through PeopleSoft is automatically assigned to a departmental inventory based upon the funding source from which payment for the item was made using object codes. If the item has been purchased for a different department, it must be transferred to that department to be reflected on the proper departmental inventory.

2. Lease-Purchase

A lease-purchase involves an item paid for on an installment payment basis, with the UTSA assuming outright ownership when the terms of the lease-purchase agreement are completed. Capital equipment acquired by lease-purchase will be added to the department's inventory after the first payment has been made with the inventory carrying value being determined by the payments that have been made.

3. Fabrication

Fabricated equipment valued at $5,000 or more ($500 or more if the item is a Controlled item) is assigned an inventory number and added to the department's inventory. Departments involved in the fabrication of equipment should have some means of keeping track of all costs related to the fabrication. When a department fabricates equipment, they must provide the Inventory Department with the item's description, cost documentation, department ownership and physical location.

4. Gifts

It is the responsibility of the department/division to initiate a Gift Processing form. All contributions of property must be processed through External Relations. External Relations will notify the Inventory Department of any gift of property including all artwork, with appropriate supporting documentation. The approved Gift Processing Form will specify the property value to determine whether the item must be inventoried. The Inventory department will coordinate tagging of gifts with the recipient department.

5. Government Excess Property

Equipment may be obtained through United States Government excess property disposal sources. This is equipment that is no longer needed by federal government departments and agencies and is made available for transfer to other Government agencies, colleges, and universities. Unless otherwise indicated in the transfer documents, equipment acquired from Government excess property sources becomes University property upon acceptance by the department/division. If the unit value is $5,000 or more ($500 or more if the item is a Controlled item: computer, camera, etc.), the item will be assigned a UTSA inventory number, tagged, entered on the acquiring department's/division's inventory, and controlled the same way as any other item of UTSA property.

6. U.S. Government Property

Specific questions regarding procedures for accounting for property used by UTSA departments to which the United States Government has retained ownership should be referred to the Property Manager.

7. Disposal of United States Government Property

Equipment that has been acquired from United States Government excess property sources may have restrictions on disposal and therefore should not be indiscriminately thrown away. If a department wants to dispose of such property, either by sale or turn-in as surplus property, the department head shall advise the Property Manager by memorandum. The following information should be provided: UTSA inventory number, item description, date acquired, excess property order number, inventory carrying value, estimated actual value and condition, and location of the item. This procedure is necessary because some agencies have restrictions affecting the disposal of equipment acquired through excess or surplus property sources. See Property Acquired Under Sponsored Programs for more information.

I. Property Acquired Under Sponsored Programs

Equipment acquired under sponsored programs is UTSA property unless specifically exempted by the terms of the sponsor’s agreement. This property is placed on the inventory of the Principle Investigator's (PI) assigned department. It should be handled and protected as UTSA property. Principal Investigators may require full time use of equipment acquired with the grant of contract funds to perform the research specified in the agreement. Such exclusive use is permissible; however, ownership of the equipment is vested with the UTSA, not with the individual.

Grants or contracts may specify that equipment acquired with the sponsor’s funding be transferred upon request by the awarding agency. Often this will involve transfer of the principal investigator and the grant to a new institution. When requested, the UTSA will provide the receiving institution and the sponsoring agency with an equipment listing including the dates of purchase and acquisition costs. The receiving institution should acknowledge receipt of the equipment and furnish copies of the acknowledgment to the UTSA.

Before transferring equipment to another institution, the PI should submit a letter to the Office of Sponsored Programs and the UTSA Property Manager through the dean, director or department chairperson, requesting approval. Include the grant number, grant name, the name of the receiving institution, and the name and title of the official authorized to receive the property in the letter. Also, include the inventory number, item description, acquisition cost and year acquired. In addition, a copy of the letter from the granting agency directing the transfer of the grant and equipment to the new institution should accompany the request. Do not remove the equipment from the university until the department/division head has received approval from the UTSA Property Manager. After approval, the department should remove the Inventory tags only when physically transferring the equipment, and send it to the Inventory Manager along with a copy of the transfer authorization. This will authorize the Inventory Department to adjust the department's/division's inventory.

Under no circumstances should property owned by the federal government be transferred to another department, declared as surplus or otherwise disposed of without acquiring clearance of ownership through the Office of Sponsored Programs. When such a transfer is requested via the Property Transfer form, copies of the ownership clearance documentation should accompany the transfer request. If the documentation is not provided, the transfers will be re-routed to the Office of Grants and Contracts for approval as no change can be made regarding federal property without appropriate clearance from the sponsoring federal agency.

J. Annual Physical Inventory

A complete Annual Physical Inventory (API) of all UTSA-owned property in the possession of departments, centers, and designated UTSA offices shall be made each fiscal year as directed by the State of Texas Comptroller’s Office and outlined in the State Property Accounting Process User's Guide, Chapter 2, Section 2.24. If a state agency fails to keep records or perform an annual physical inventory, the State Comptroller may refuse to draw warrants or initiate electronic fund transfers on behalf of the agency.

1. Pre-Inventory/Custody Listing

To help promote responsible stewardship of UTSA property, a Pre-Inventory/Custody Listing of all inventory-tagged departmental property is incorporated into the Annual Physical Inventory Process. It is mandatory that UTSA (faculty/staff) employees sign the Pre-Inventory/Custody Listing for all items for which they are responsible

2. Procedures

Each year a department must designate an Inventory Contact Person (ICP) who will be required to attend mandatory training: DE675 Inventory: Palm/Scanner Usage. This class is a hands-on training class for newly designated ICP’s. DE676 Inventory: Palm/Scanner Usage Refresher Class is an online course for ICP’s who have already attended DE675. After completing the appropriate training course, each ICP will receive a departmental Pre-Inventory Custody listing of departmental assets and an information packet on how to conduct the inventory. Using a UTSA-provided barcode scanner, the ICP will complete the inventory and return the scanner and paperwork to the Inventory Department within a prescribed timeframe. The timeframe will be determined according to the number of items within each department.

All items identified on the Pre-Inventory listing must be located and scanned by the ICP. The condition (fitness to render services) of each asset should also be evaluated and updated on the Pre-Inventory listing, as appropriate. Missing items, changes, or erroneous data should be reported, as appropriate, on one of the Inventory forms. Questions about specific items should be addressed to the Inventory Department staff during the inventory process. Departmental personnel should use the annual inventory process as an opportunity to ensure that the property is still being used, properly cared for and maintained. Any property not being used should be declared as surplus property to avoid future loss. The UTSA is evaluated on its ratio of lost and stolen property and this is reported each year. Agencies must keep their ratio of lost and stolen item value to no more than 1 percent of the total value of all their assets or risk having their budgets reduced.

Upon completion of the inventory, the original copy of the Pre-Inventory Custody listing, all supporting documentation, forms, etc. shall be returned to the Inventory Department along with a Certification of Departmental Annual Physical Inventory form signed by the Department Head. Before signing the certification form, the Department Head should ensure that all items on the inventory listing are located. All forms must be returned along with the Pre-Inventory list to the Inventory Department. A duplicate copy of all documentation should be kept on file in the department and used as a management tool in controlling inventory items during the year. These items may be subject to review during a Quality Assurance Review.

The Annual Physical Inventory is considered complete when the Inventory Department downloads the inventory data from the scanners, conducts a reconciliation of the data, and sends a Post-Inventory report back to the department detailing the reconciliation results of each item inventoried. All department personnel should continue to aggressively search for items reported as missing/stolen and if found the item must be reinstated using the appropriate form.

K. Tagging Equipment in New Buildings

The Facilities Coordinator provides the Inventory Office with the equipment listing of all new furniture including description of equipment, location and acquisition price. Inventory assigns each controlled/capitalized items inventory numbers and determines who owns the equipment. After tagging, the Inventory numbers are entered into the PeopleSoft System and appear on the appropriate Department's annual inventory.

L. Marking Non-State (Personal) Property

All personal property belonging to students, faculty, and staff of the UTSA shall be marked: “Personal Property of ___________.” Any property belonging to an outside company but placed on UTSA premises, whether for trial use or other purposes, should be clearly identified as “Property of ____________ Company.” By so marking personal items, much time and effort can be saved during the annual physical inventory and routine departmental audits of equipment.

M. Property Records Retention Policy

The Texas State Records Retention Schedule requires agencies to maintain property records for the life of the asset and for a period not less than three fiscal years after the disposal of property. Property records should include any payment-related source documentation (i.e. invoices, payment vouchers, receipts, etc.) necessary to substantiate the value of the asset. The Inventory Department and Disbursements and Travel Services will retain all required documentation for the specified retention period.

N. Works of Art and Historical Treasures

According to the State Property Accounting Process User’s Guide Chapter 1.25: Works of Art and Historical Treasures are collections or significant individual items that are owned by a state agency and are not held for financial gain but rather for public exhibition, education or research as part of a public service. Collections or individual items are subject to an organizational policy that requires the proceeds from their sales to be used to acquire similar items.

In compliance with GASB 34 Paragraph 27c, every UTSA Work of Art and Historical Treasure is currently:

  1. Held for public exhibition, education, or research in furtherance of public service, rather than for financial gain.

  2. Protected, kept unencumbered, cared for, and preserved.

  3. Subject to the policy of the University of Texas System that any proceeds from the sale of a collection item be used to acquire other items for collections. According to the UT Regents Rules & Regulations, Series 80201 Sec 6 - Disposal of UT System Property.

1. Sale of Artwork or Duplicate Volumes

When the president of an institution determines that a work of art or a duplicate of a valuable, rare, or significant volume is no longer of significant use for the purposes of teaching or research, the item is subject to sale following the procedure outlined in this section. The disposability and current fair market value of the item shall be certified by a three-member panel (including either an art historian or a bibliographer) and the director of the collection disposing of the property. The U. T. System and any of its institutions shall be given first choice in acquiring the item before it is offered for sale. Proceeds from the sale shall be used for purchases to improve the collection from which the item was drawn or to select items more appropriate to the institution’s collection areas. Sale is subject to the approval of the president and must be for the fair market value of the item. A permanent record shall be made of the disposition and future location of the item.

2. Acquisitions of Artwork and Historical Treasures
  • Purchases: All Works of Art and Historical Treasures that are purchased with UTSA funds in the name of the UTSA are considered property of the UTSA.

  • Donations: All Works of Art and Historical Treasures that are donated become the property of the University of Texas at San Antonio (UTSA) upon acceptance approval being granted by the University’s Development Office. See the UTSA Handbook of Operating Procedures, 9.23 Procedures Governing Private Gift Solicitation, section F for more information.

3. Artwork Capitalization Policy

It is the policy of the University of Texas at San Antonio to capitalize all Works of Art and Historical Treasures at the purchase cost at the time of acquisition or, for donated items, at the value indicated on the Gift Processing Form.


DEFINITIONS

Term Description

Property

Furniture, equipment, works of art, or other items of a non-consumable nature that are reasonably expected to last more than a year.

State Agency

Any department, commission, board office, or other agency in the executive branch of state government created by the constitution or a statute of this state; or a University system or an institution of higher learning, other than a public junior college.

REFERENCES/LINKS

RELATED FORMS/WORKSHEETS


REVISION HISTORY

removing printers from the list of controlled equipment per the new State requirements.
Date Description

05/01/14

Updated DEFINE information for transition to PeopleSoft.

01/22/14

Removing printers from the list of controlled equipment per the new State requirements.

07/02/13

Changed all "University Advancement" instances to "External Relations."

04/25/13

Updated broken link for Quality Assurance Review.

02/11/11

Departments must evaluate the condition of each asset during the Annual Physical Inventory (API) process and update the Pre-Inventory/Custody List if the condition has changed.

12/02/10

Added new Pre-inventory/Custody Listing to Annual Physical Inventory section (J). Inserted Procedures heading to same.

09/01/10

Added a new section, Proper Use of University Property.

08/25/10

Added the Capital Asset Manager, Inventory Manager and Surplus Property Supervisor to the Roles and Responsibilities section.

08/13/10

Published guideline as HTML.


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