The University of Massachusetts (UMass) Dartmouth did not maintain an accurate inventory list or assign asset identification tags to all of its fixed assets. As a result of these issues, there is a higher-than-acceptable risk of undetected theft or misuse of fixed assets.
Of the 30 items sampled in order to verify their physical existence, we could not locate 12 items, totaling $70,064. Additionally, for our audit period, 330 items, valued at $1,433,515, had not been added to UMass Dartmouth’s inventory list.
UMass Dartmouth processes all purchases, including fixed assets, through PeopleSoft. When a fixed asset is purchased, the item is moved to the Staging Table. This holds the asset in “suspense” until UMass Dartmouth’s Property Control staff records the asset identification tag number, the location of the asset, and other pertinent information about the asset. The asset is then added to PeopleSoft’s asset management (AM) module and tracked on the inventory list.
UMass Dartmouth officials told us that their unwritten practice was for Property Control personnel to run the Staging Table Report weekly to identify assets in suspense, match each asset to a purchase order, and record the asset information in the AM module. If an asset is added in error, Property Control makes the correction by removing the asset from the AM module. The Staging Table Report had 330 items that had not been added to the inventory list.
According to UMass Dartmouth’s Moveable Equipment Inventory User Manual, the AM module of its PeopleSoft system is the system of record for the university’s movable equipment and fixed assets and should be accurate: “This system operates . . . to provide accurate and timely information concerning University moveable equipment and fixed assets.”
The manual also states that once the university has received purchased equipment,
The Property Control Office will tag the asset and retain the information until the inventory item is downloaded to the Asset Management (AM) staging table for processing into AM. Upon payment of invoice . . . the Property [Control] Office will review all applicable purchase orders to determine title, location and tag type. The Property Control Officer will then record the item’s physical characteristics [in the AM module].
Reasons for Noncompliance
Although UMass Dartmouth has established policies and procedures for the inventory of fixed assets, it has not established adequate monitoring controls to ensure that they are consistently followed.
Management was unable to provide explanations for the missing fixed assets.
- Management should enhance its monitoring controls to ensure compliance with inventory policies and procedures.
- Management should investigate the reasons that assets in UMass Dartmouth’s inventory list cannot be located and take whatever actions it deems necessary to resolve this issue, including updating its inventory list to remove these assets.
A full time staff person was hired in December of 2016. In the last year the individual has been updating the asset management system by processing updates to the database, reconciling missing assets and addressing assets on the Staging Table.
The 330 items on the Staging Table have been reconciled with all assets being tagged that required tagging. Management will continue to utilize the two quarterly reports that monitor asset purchases that assist in ensuring policy and procedures are followed, and it will enhance these monitoring processes by implementing a third aging report that identifies assets on the Staging Table that are not recorded in the asset database. . . .
Management will investigate why these assets could not be found, reconcile as required and based on what is discovered determine if controls require enhancement.
The actions taken by UMass Dartmouth to address its inventory practices, as described above, were responsive to our concerns and will allow it to account for its assets more effectively. The additional staff member and the use of monitoring reports should ensure that all assets are accounted for accurately in the database. The status of all missing assets should be determined and the necessary adjustments made to the database.
|Date published:||April 9, 2018|