Removal of Property from a Department's Inventory

Responsible Officer: Vice President for Business Affairs and Controller

Sponsoring Department: Asset Management

Revision Date: 23 April 2013

Errors or changes to: aim@uta.edu

Procedure Objective

This fiscal procedure provides procedural guidelines for the removal of property from a university department's inventory in accordance with applicable laws, rules, and policies. Procedures concerning the notification of removal, the documentation of removals, and the methods of removal are included in this fiscal procedure.

Rationale

Property may be removed from a university department's inventory by a variety of means. Reasons for the removal of property from a departmental inventory include the transfer of property, sale of equipment, trade-in of equipment, property being discarded, and/or property becoming lost or stolen.

Scope

All university departments who remove property from their department's inventory

Related Statutes, Policies, Requirements or Standards

Contacts

If you have any questions about Procedure 2-45, contact the following departments:

SubjectOffice NameTelephone NumberEmail/URL
All topics in procedureAsset Management817-272-2191

assetmanagement@uta.edu

http://www.uta.edu/policy/bac/inventory

Website accessAdministrative Information Management817-272-0222

aim@uta.edu

http://www.uta.edu/aim

Definitions

Personal Property: Any possession of the State of Texas having sufficient value to warrant inclusion in the fixed asset financial reports or due to the nature of the asset that is required to have management controls placed upon it. Personal property does not include consumable items nor does it include real property such as land or buildings, improvements to land or buildings, or infrastructure.

Capital Assets: A capital asset is any furniture or equipment item(s) with a single value of $5,000 or greater and an estimated useful life of more than one year. (This dollar threshold was established by the Texas Legislature, and became effective September 1, 2001).

Surplus: Any property which is in excess of the needs of a department and/or the University and which is not required for its foreseeable need. Surplus property may be new or used but must have additional useful life.

Salvage: Any equipment that through use, time, or accident is so depleted, worn out, damaged, consumed, or outdated that it is obsolete and/or can no longer serve the purpose for which it was originally intended.

Stolen: Any equipment missing by theft, whether by forced removal, burglary, theft by employees, or other criminal acts.

Trade-in: Surplus or salvage property, which in the best interest of the State, is exchanged for new property of the same general type.

Missing: Equipment whose disappearance cannot be explained.

Responsibilities

Asset Management Office (AM)
  • Complete Inventory Transaction Form (Form 2-45) when a university department wishes to transfer equipment to Surplus Property that is not listed on the departmental inventory

  • Prepare a Transfer Property Form when property is to be transferred to another state agency, university, or research facility

Employees and University Departments Involved in the Removal of Property from a Departmental Inventory
  • Erase all electronic media before transferring equipment to another university department or to Asset Management

  • Comply with all applicable laws, rules, regulations, UT system policies and standards, and UT Arlington policies and procedures, including Regents' Rule 80201, Disposal of UT System Property, UTS 162, Disposal of Unclaimed Property, and Texas State Government Code Chapter 403.271 to 403.278

  • Advise the AM Office when planning to transfer university property to another state agency

  • Conduct a diligent search for missing items and will notify the University Police Department if the item can not be found

  • Notify the University Police Department immediately if an item of property is believed to have been stolen

  • Notify the Information Security Office immediately if a university owned computer is believed to be missing or stolen
Department Head
  • Sign Inventory Transaction Form (Form 2-45) when transferring property to another department

  • Recommend to the Property Manager that cannibalization of equipment be permitted

  • Ensure that the loss of an item was not due to negligence on the part of a department employee

Surplus Property Manager
  • Enlist the services of an auctioneer to sell items that are no longer needed by the university and are impractical to store for future use

  • Review all items in surplus property storage and advises the Property Manager of those items which have been in storage and availability has been circulated to all departments

  • Survey the surplus property inventory for items which are damaged and broken beyond repair

Vice President for Business Affairs and Controller
  • Approve the sale of university property to non-university organizations or individuals

Procedures


Section I. Erasing Electronic Media

Note: It is the responsibility of all university departments to erase electronic media (hard disk drive, floppy disk, or magnetic tape) before transferring equipment to another university department or to Asset Management. This task must be preformed to prevent the inadvertent disclosure of protected and/or confidential information.

Section II. Transfer of Property

Property can be transferred internally to another department or to Surplus Property, or externally to another state agency.

  1. Transfer to Another Department: When equipment is to be transferred to another University department, Inventory Transaction Form (Form 2-45) should be completed by the transferring department.

    1. The form must be signed by the transferring Department Head or designee and it is then forwarded to the receiving department. A comparable official of the receiving department must sign the form agreeing to accept the property.

    2. After the form has been signed on behalf of both departments the form should then be sent to the Asset Management (AM) office. When the form has been processed by the AM Office, the property items will be assigned to the receiving department's inventory. Until then, the transferring department remains accountable for the equipment.

    3. If the departments require assistance in moving the equipment, they should indicate this at the bottom of Inventory Transaction Form (Form 2-45) and the AM Office will forward the form to Central Receiving for scheduling the move.

  2. Transfer to Surplus Property: When equipment in a department is no longer needed by the department and is not going to be transferred to another department, the equipment should be transferred to Surplus Property, Unit 0270001.

    1. If the property is on inventory, Inventory Transaction Form (Form 2-45) should be completed and sent to the AM Office.

    2. If the property is not on inventory, a memo should be sent to the AM Office. The AM Office will complete Inventory Transaction Form (Form 2-45) and forward it to Central Receiving for pickup of equipment if necessary.

  3. Transfer to Another State Agency, University or Research Facility: Property may be transferred to another State Agency, University or Research Facility. The procedure is the reverse of that when property is received from a State agency, and the Transfer Property Form again is used. For information regarding the transfer of property to university departments from other state agencies, universities, or research facilities see Addition of Property to a Department's Inventory (Procedure 2-44).

    1. The form is prepared in the AM Office with information provided by the transferring department.

    2. Departments planning to transfer University property to another State agency should advise the AM Office, in writing, by completing Inventory Transaction Form (Form 2-45) with the UT Arlington inventory number, description serial number, and inventory carrying value.

    3. The name of the agency receiving the property and justification for the transfer must be provided. If approved, the Property Manager will sign the Transfer Property Form and it will be forwarded to the State Agency, University or Research Facility.

    4. Before the item is physically transferred, the University property tag should be removed and sent to the AM Office. The shipping details should be agreed upon between the transferring and receiving agencies.

Section III. Removal of Surplus Property
  1. Removal of Surplus Property Items from Inventory: The Surplus Property Manager will review all items in surplus property storage and advise the Property Manager of those items which have been in storage and availability has been circulated to all departments. The purpose is to review for possible removal from the inventory those items which are serviceable but have no further value to the University and are not or will not be used.

    1. Section 4 of Regent's Rule 80201 states that for items of little value or limited use where sale on competitive bids is not practicable, the chief business officer shall have the authority to dispose of the property on the basis of negotiated bids or surplus auction in amounts under $50,000. Sales to employees are governed by the provisions of UT System Policy UTS159 regarding purchasing.

    2. Senate Bill 1105, Section 2175.126(a) and (b) of the 76th Legislative Session mandates that surplus data processing equipment should be sent to the Texas Department of Criminal Justice to become part of the "TDCJ Computer Recovery Program".

    3. Asset Management does make donations of surplus property to qualifying agencies. The qualifications for these agencies may be found in Texas Government Code Section 2175.001(1).

  2. Removal of Damaged or Broken Surplus Property: The Surplus Property Manager is responsible for constant surveillance of the surplus property inventory for items which are damaged and broken beyond repair. If such items are present, Inventory Transaction Form (Form 2-45) will be submitted to the AM Office to drop the items from inventory.

  3. Cannibalization: There are times when it is practical or economically sensible to remove parts from an item of equipment that is obsolete, broken, or is intended to be discarded. This practice is commonly called "cannibalization." It normally is to be avoided. However, if the best interests of the University can be served by the removal of parts from an item before transferring it to Surplus Property for disposal, the department head shall recommend to the Property Manager that cannibalization be permitted.

    1. Requests to remove a part from an item for cannibalization should be submitted on Inventory Transaction Form (Form 2-45) to the AM Office. This recommendation shall include a statement that the item is obsolete, or is inoperable and not economically feasible to repair and that the parts to be taken from it will be used to repair or construct other University equipment. When the Property Manager approves the request, cannibalization may begin.

Section IV. Sale of Equipment
  1. Equipment valued at less than $50,000 may be sold to non-University organizations or individuals with approval from the Vice President for Business Affairs and Controller. To obtain approval:

    1. A memorandum should be sent to the Vice President for Business Affairs and Controller's Office, Box 19136. This request should briefly explain:

      1. The reason for the sale
      2. How the sale will benefit UT Arlington
      3. Expected proceeds from the sale and how the proceeds will be used
      4. A description of the item being sold
      5. The item's inventory number
      6. How the item was acquired
      7. Item's acquisition costs (if purchased)
      8. Year the item was acquired
      9. The item's condition
    2. If the item was acquired under a grant, the memorandum should assure that there is no further obligation to the sponsor. A sale will be made only if the department head and the Vice President for Business Affairs and Controller agree that the price offered is reasonable and it is in the best interest of the University to dispose of the property in this manner.

      1. If sold, the University inventory tag must be removed and be sent to the Asset Management Office with Inventory Transaction Form (Form 2-45) and a memorandum advising of the sale. Information provided should include the following:

        1. The item's inventory number
        2. Description of the item
        3. Date sold
        4. Amount received for each item
        5. A copy of the deposit slip from the University Bursar's Office
Section V. Trade-in of Equipment
  1. University equipment may be traded in for credit toward the purchase of new equipment.

    1. A description of the item being traded in, including the inventory number and the trade-in allowance, should be noted on the purchase requisition as well as on Inventory Transaction Form (Form 2-45) sent to the AM Office. This is necessary to ensure the item being traded in is properly accounted for and clearly identified for removal from the department's inventory records.

    2. Before the trade-in item is relinquished, the inventory number tag should be removed and be sent to the AM.

Section VI. Missing or Stolen Property

When a department member becomes aware that an item of equipment is missing, a thorough search must be started immediately and be continued until the item is found or it is determined that the item has been stolen or is missing.

  1. Stolen Property
    1. If an item of property is believed to have been stolen, the University Police Department should be notified immediately.

    2. The department should obtain a copy of the Offense/Incident Report. To have the item removed from the departmental inventory, Lost or Missing University Inventory Report Form (Form 6-4) should be sent to the Asset Management Office. A copy of the police report must accompany Lost or Missing University Inventory Report Form (Form 6-4).

    3. If a computing device (desktop, laptop, tablets, etc.) has been stolen/missing the department must forward a copy of Lost or Missing University Inventory Report Form (Form 6-4) to the Information Security Office.

  2. Missing Property
    1. Property that is missing must be reported to the University Police Department after the department has conducted a diligent search for the item.

    2. Missing property will be indicated on the department's inventory listing when the Asset Management Office receives Lost or Missing University Inventory Report Form (Form 6-4) indicating the missing item(s).

      1. If the item(s) are located, the Asset Management Office should be notified.

      2. When approved by the Property Manager, the item will be deleted from the inventory.

      3. It is further incumbent upon the department head to be sure that the loss was not due to negligence on the part of an employee. The Attorney General may investigate the loss and, if the investigation discloses that it was sustained through negligence, the Attorney General may demand reimbursement to the State for the Property loss.

    3. If a computing device (desktop, laptop, tablets, etc.) has been stolen/missing the department must forward a copy of Lost or Missing University Inventory Report Form (Form 6-4) to the Information Security Office.

Forms and Tools/Online Processes

Appendices

None