Inventories

When agencies do not efficiently track, inventory, identify, and dispose of excess personal property, they increase federal expenditures and waste the unused value of personal property assets. For example, an agency may purchase items they could have obtained at no cost from another agency’s excess inventory. The federal government also incurs greater storage expenses when agencies hold onto excess property and loses revenue from potential sales.

As directed by PL 115-419, the Federal Personal Property Management Act of 2018 agencies are required to:

• Conduct annual inventories of capitalized assets; and
• Conduct inventories of accountable assets on a regular basis.

For both these inventories, agencies must assess:

1. The age and condition of the personal property.
2. The extent to which the executive agency utilizes the personal property and identify excess, identification of excess depends on a good inventory.
3. The extent to which the mission of the executive agency is dependent on the personal property.
4. Any other aspect of the personal property that the agency Administrator determines is useful or necessary for the executive agency to evaluate.

GSA suggests that accountable personal property asset inventories would reasonably be conducted at least once every three years for assets that are: Accountable but not capitalized; pilferable; or that the agency determines to fall under a special circumstance that would require more frequent inventories. Inventories can be conducted either all at one time or in stages over the full inventory period. An agency’s inventory policy and procedures should include the methodology to capture the items above and address any inventory variance or discrepancy that might arise.

Agencies may consider the use of electronic “discovery tools” that poll electronic assets through the agency network to determine the presence and use of linked assets as a part of the agency inventory process. However, as part of the inventory process or in addition to that process, trained asset managers should touch or view the assigned assets to determine if the assets are being used, and if there is obvious damage or if repairs are needed.

GSA also suggests that an agency’s inventory procedures include retention justifications for warehouse assets held beyond a certain amount of time and examination of post-inventory data to identify potential excess. Agencies should not warehouse or otherwise hold unneeded items but should excess them as soon as possible.

FMR 102-36.45 requires agencies to assure maximum use of personal property and develop a system to prevent nonuse and identify excess. Agencies should note that inventories are not the only means of identifying excess personal property. However, as the Federal Personal Property Management Act of 2018 (Pub. Law 115-419) requires agencies to perform regular inventories, it is an efficient means of identifying excess at the same time. Agencies may also use periodic utilization reviews such as management walkthroughs, routine property custodian reviews, utilization surveys, or other tools to identify excess.