MEMORANDUM

TO: All Agencies, Boards and Commissions

FROM: Steve Sulek, Acting Materiel Administrator

Paul Carlson, State Accounting Administrator

DATE: June 9, 2008

SUBJECT: Annual Physical Inventory, June 30, 2008 and Year-end Fixed Asset Procedures

In accordance with State Statute 81-1118.02 all Agencies, Boards, and Commissions are required to conduct an annual inventory of property as of June 30, the fiscal year end. This inventory shall include property in the possession, custody, or control of each executive, department, commission, or other state agency as of June 30. A report listing all property shall be completed and filed with the Administrative Services, Materiel Division – Surplus Property by August 31, 2008.

In order to provide Materiel an accurate property listing, and to provide State Accounting with accurate Fixed Asset data, you should run the following three reports relative to FY 08 (NIS FY 7) as soon as possible:

(a) Auditor F/A Listing Report (R5509273) - either by tag number or location

(b) Fixed Asset No Cost Integrity Report (R55362)

These reports should be run for several reasons: (1) to ensure you have a proper listing of all fixed assets to provide to the Materiel Division Administrator; (2) to confirm all fixed asset transactions are properly recorded in the General Ledger; and (3) to ensure fixed assets are accurate for the proper calculation of depreciation expense on the State’s year-end financial statements.

In order to run these three reports, please refer to the attachment containing full instructions along with appropriate links to the NIS training manuals. As you read these instructions, please be aware of the time deadlines for year-end processing.

All assets currently in possession of the agency meeting the capitalization threshold must be entered into the Asset Master Information in NIS. All assets over $1,500 must be capitalized; however, agencies, at their discretion, can lower this amount and can enter assets with costs less than $1,500.

When reporting the annual physical inventory of property to Surplus Property, agencies have the option of either: 1) submitting the hard copy of the "Auditors F/A Listing Report”, or 2) creating a .PDF version of this report on a CD. In either case, you must forward the report with the required certification memorandum. The memorandum must state the required physical inventory has been completed and all items have been located. If any items cannot be located, this memo should state the items that could not be located. These items need to be identified in the Asset Master Information in NIS as status code "UL" which indicates and signifies as “unable to locate”. Agencies should continue to look for these items and report to Surplus Property when found. If the agency is unable to locate the items in question, Surplus Property can assist you with the procedures to remove them from fixed assets. All items in a "pending" status in the equipment status column of the Asset Master Information in NIS (and on the Auditor F/A Listing Report as “pending”) do not need to be identified or explained separately as long as the required documentation is on file at Surplus Property.

A copy of the required annual report with the certification memorandum needs to be received by Surplus Property at 5001 South 14th Street by August 31, 2008.

If you have any questions concerning this process or any other fixed asset issue, either now or in the future, please contact Steve Sulek at (402) 471-2401.