1. EQUIPMENT TRACKING AND FABRICATION NCURA Region III 2008 Spring Meeting May 13, 2008 May 13, 2008

2. Topics of Discussion Equipment Tracking Defined AU Policies And Practices The Government’s Policies Fabrication Defined Other University’s Policies and Practices

3. EQUIPMENT TRACKING Defined

4. Equipment Tracking A process of ensuring that property acquired is, used, inventoried and maintained in accordance with contractual requirements Data and paper management of property records Tagging, coding, recording and permanent identification of purchase Accounting for, coordinating, scheduling and performing an annual, centralized inventory of university property Coordinating and scheduling disposition

5. AU’s Equipment Tracking Policy Each department must have an Equipment Accountable Officer Purchase requisitions are properly coded as equipment Item (s) are automatically fed from Purchasing System to Fixed Asset System Equipment is capitalized if it costs $2,500 or more

6. AU’s Equipment Tracking Policy An article of nonexpendable, tangible personal property Has a valued life of at least one year Equipment is given a property control tag Inventoried every two years All equipment purchased with contract or grant funds or on an associated cost share account must be approved by OSP.

7. AU’s Equipment Tracking Policy Identification Each piece of capitalized equipment must have a university or government identification tag Property Services provides tags Some department may tag equipment in addition to Property Services

8. AU’s Equipment Tracking Policy Identification

9. Identification

11. Identification Identification tags should not be removed, damaged or altered in any way. Tags should be uniformly located A Property Service representative will tag equipment when the invoice for the purchase has been paid

12. AU’s Equipment Tracking Policy Identification Information recorded in Property System after tagging includes Description of the Equipment Manufacturer Model Number Serial Number

13. AU’s Equipment Tracking Policy Identification Vendor’s Name Purchase Order Number FOAP Number Date of Receipt Total Price Location

14. AU’s Equipment Tracking Policy

15. Physical Verification of Inventory A physical inventory of equipment is performed at least once every two years Property Services supplies the Accountable Office with two copies of most current equipment inventory report The department must physically locate all equipment and confirm location and condition

17. AU’s Equipment Tracking Policy Physical Verification of Inventory Each Accountable Office should maintain a listing of departmental property. A completed copy of the inventory report must be returned to Property Services within 45 days of receipt Inventory reports must be dated and signed by the Accountable Officer and department head

19. AU’s Equipment Tracking Policy Physical Verification of Inventory The department must provide documents supporting status changes to all equipment Late or not returned inventory reports are subject to a penalty equal to 1% of the total inventory costs, not to exceed $1,000, charge every 30 days until report is returned

20. AU’s Equipment Tracking Policy Physical Verification of Inventory Excessive missing or unaccounted for equipment will be reviewed by Property Services, department head and Accountable Officer and findings reported to the dean and/or vice president

21. AU’s Equipment Tracking Policy Physical Verification of Inventory A budget assessment equal to 30% of the book value (cost less accumulated depreciation) of missing equipment that is over two years old and 100% of missing equipment that is less than two years old will be assessed for unacceptable levels of missing equipment

22. AU’s Equipment Tracking Policy Physical Verification of Inventory Written permission is required from appropriate department head before equipment can be removed from university premises.

23. AU’s Equipment Tracking Policy Transfer and Disposition Equipment is sometimes transferred from one department to another Accountable Officer completes Equipment Transfer Form-BO 80-01 before property is transferred Form is sent to Property Services for approval

25. AU’s Equipment Tracking Policy Transfers and Disposition Equipment purchased by contracts and/or grants, that is to be transferred outside of the university is dependent upon stipulations in the contract and grant and requires OSP approval

26. AU’s Equipment Tracking Policy Transfer and Disposition When equipment is no longer useful or needed, departments may transfer it to Property Services’ Excess and Surplus Property using form BO 80-01 Property Services will arrange for equipment to be moved When transfer is made the department relinquishes control of equipment An equipment Release Form is completed

27. AU’s Equipment Tracking Policy Transfer and Disposition All requests to cannibalize equipment must be approved by Property Services Equipment may be cannibalized when it is no longer operational, repairable or obsolete Cannibalized equipment is removed from the university’s inventory record with Form BO 80-01

28. AU’s Equipment Tracking Policy Transfer and Disposition In some instances property purchased under a contract and/or grant may eventually revert title back to the grantor Property Services should be notified regarding disposition of property at the end of the contract/grant period

29. AU’s Equipment Tracking Policy Federal Property PI’s must maintain a separate and complete file of purchase orders and receiving reports for equipment acquired under each federal project Equipment purchased under a federal project should be tagged by Property Services

30. AU’s Equipment Tracking Policy Federal Property If title is to remain with the government, equipment is given a government identification tag with control numbers in the 40000 range Upon Completion of the award or if property is no longer needed for project OSP requests disposition instructions

31. AU’s Equipment Tracking Policy Federal Property The federal awarding agency has the option of: Approving use on another project Approving transfer of title to the university Requesting return of the equipment Authorize sale of the equipment and reimbursement to the awarding agency

32. AU’s Equipment Tracking Policy Federal Property Auburn University is subject to an audit of its equipment inventory standards administered by The Office of Naval Research (ONR). These audits: Examine the records and procedures maintained by the university Physically inspect equipment Interview university personnel

33. AU’s Equipment Tracking Policy Reporting Institutions having contracts and/or grants that are administered by ONR University Business Affairs are required to submit an annual report of Government Titled Property to the funding agency Annual reporting should be for period ending September 30

34. AU’s Equipment Tracking Policy Reporting DoD awards, property reports must be submitted no later than October 31 on DD From 1662 – “DoD Property In The Custody Of Contractor” NASA Property Reports must be submitted no later than October 15 on Form 1018 – “NASA Property In The Custody of Contractors”

37. The Government’s Policies

38. Government’s Equipment Policy Property Management Per OMB Circular A-110, universities are required to Perform a physical inventory that reconciles with the equipment records at least once every two years Provide a control number to prevent theft, damage or loss of equipment

39. Government’s Equipment Policy Property Management Per A-110, the asset system must accurately maintain the following data accurately maintain the following dataDescription Manufacturer’s Name Serial Number Model Number

40. Government’s Equipment Policy Property Management Source of funding Acquisition date Location Unit Cost Title determination

41. Government’s Equipment Policy Special Purpose Equipment Per OMB Circular A-21, equipment which is used only for research, medical, scientific or other technical activities Expenditures for special purpose equipment are allowable as direct charges with the approval of the sponsoring agency

42. Government’s Equipment Policy General Purpose Equipment Per OMB Circular A-21, equipment, the use of which is not limited only to research, medical scientific or other technical activities Examples include office equipment and furnishings, reproduction and printing equipment, motor vehicles and automatic processing equipment

43. Government’s Equipment Policy General Purpose Equipment Expenditures for general purpose equipment are unallowable and direct charges, except where approved in advance by the sponsoring agency

44. Government’s Equipment Policy Government Property Government Furnished – A government owned asset furnished to the university for utilization on a specific program or project A government owned asset furnished to the university for utilization on a specific program or project

45. Government’s Equipment Policy Government Property Government Owned An asset acquired with government funds, whose title remains vested with the federal government An asset acquired with government funds, whose title remains vested with the federal government

46. Government’s Equipment Policy Government Funded Property An asset acquired with government funds, in accordance with the terms and conditions of a government grant or contract Title or ownership of such property may be vested with the university or the federal government

47. Government’s Equipment Policy Government Funded Property When property is no longer needed for the purpose of the original project, the following procedures apply Equipment with a fair market value less than $5000 may be retained, sold or disposed of with no further obligation to the federal government

48. Government’s Equipment Policy Government Funded Property For equipment with a current fair market value of $5000 or more The university may utilize the equipment in the project or program for which it was acquired as long as needed, whether or not the project or program continues to be supported by government funds

49. Government’s Equipment Policy Government Funded Property When the equipment is no longer needed for the original project or program, it should be utilized in connection with federal-sponsored activities in the following order

50. Government’s Equipment Policy Government Funded Property Activities sponsored by the federal awarding agency which funded the original project Activities sponsored by another federal awarding agency

51. Fabrication Defined

52. Fabrication To construct by combining or assembling diverse, typically standardized parts Has a useful shelf life of more than one year Is made of material and components which cumulatively cost $2,500 or greater Requires creative efforts to design and construct Meets unique research specifications Is a freestanding and complete functional entity Does not lose its identity when affixed to or installed in other property

53. Fabrication Material purchases for the fabrication must be maintained by project personnel The sponsoring agency and OSP must approve any fabrication request for sponsored research Requisitions, purchase orders and invoices for components parts must reference the approved fabrication

54. Fabrication Fabricated equipment will be properly tagged upon completion The fabricated equipment is added to the department’s physical inventory list Any items purchased to upgrade or replace an existing fabrication should reference the property tag on the existing equipment

55. Fabrication When the fabricated items becomes obsolete or is no longer used and the department wishes to breakdown or dispose of the item Property Services must be notified When the sponsored program is a contract for the construction of a piece of equipment, ownership will transfer to the sponsor

56. Equipment Tracking and Fabrication Other Universities Policies and Practices

57. Equipment Tracking and Fabrication Closing Valuable Web sites: Office of Naval Research (ONR) – www.onr.navy.mil/02/024/apr.asp www.onr.navy.mil/02/024/apr.asp DoD Manual for the Performance of Contract Property Administration www.dtic.mil/whs/directives/corres/pdf/41612m_1291/p41612m.pdf www.dtic.mil/whs/directives/corres/pdf/41612m_1291/p41612m.pdf Federal Property Management – www.access.gpo.gov/nara/cfr/waisidx_02/41cfv2 www.access.gpo.gov/nara/cfr/waisidx_02/41cfv2 NASA – www.nasa.gov/offices/ocfo/refernces/ocfo_cntr_prop.html www.nasa.gov/offices/ocfo/refernces/ocfo_cntr_prop.html DOE – www.access.gpo.gov/nara/cfr/waisidx_04/41cfrv3_04.html#109-1 www.access.gpo.gov/nara/cfr/waisidx_04/41cfrv3_04.html#109-1

58. Equipment Tracking and Fabrication ClosingQuestions?? Valerie Morns-Riggins Valerie Morns-Rigginsmornsvv@auburn.edu (334) 844-5909