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PROPOSAL:

Remove Various Fixed Assets from AQMD Inventory

SYNOPSIS:

AQMD Policy and Procedure No. 20 requires a biennial Districtwide fixed asset inventory, an annual Applied Science and Technology inventory, and the disposal of fixed assets declared surplus. In 1997 the biennial Districtwide fixed asset inventory was conducted. This action is to approve removal of unlocated fixed assets and to declare as surplus the equipment determined to be obsolete or broken and not worth repairing.

COMMITTEE:

Administrative, May 22, 1998, Recommended for Approval

RECOMMENDED ACTION:

1. Authorize the removal of the equipment identified on Attachment A from AQMD’s fixed asset inventory.

2. Declare the items on Attachment B as surplus and authorize their deletion from the AQMD fixed asset inventory; and authorize the Purchasing Manager to dispose of these fixed assets by direct sales, public auction, or donation.

Barry R. Wallerstein, D.Env.
Acting Executive Officer

Background

AQMD Administrative Policy and Procedure No. 20 establishes procedures for the approval, purchasing, tagging, physical inventory, and disposal of fixed asset equipment. This policy requires an annual inventory of the Applied Science and Technology division (AST) and biennial inventories of all other divisions. In accordance with this policy, staff has previously requested the Board’s approval to remove equipment which had been retired, damaged, or reported missing from the inventory of assets. The last request to remove surplus or missing items was approved on December 12, 1997 and represented the results of the 1995 biennial Districtwide inventory and the 1996 AST annual inventory.

During August through December 1997, each division at the AQMD conducted a biennial physical inventory of its equipment. These inventories were observed by Finance staff. Bar code scanners were used to account for the assets. Following the conclusion of this inventory, additional efforts were made to locate assets which were missing and where appropriate, controls were reviewed with the divisions in an effort to provide better safeguards for assets. The most common items reported missing were computer-related equipment and hardware.

Attachment A is a list of unlocated and stolen fixed assets, sorted by division, comprised of missing items as determined from the August through December 1997 inventory. Attachment B is a list of obsolete or non-repairable office equipment that has already been replaced as required. AQMD Administrative Policies and Procedures No. 20 provides that surplus property is to be surrendered to the Purchasing Manager for disposal.

A summary of the information in Attachments A and B appears below:

Proposal

Because of the age of the assets, the current value of these missing assets is materially less than the recorded value. Staff recommends that the unlocated items on Attachment A be removed from the AQMD’s total fixed assets inventory of $18,998,275. Based on original cost, the items for which removal is recommended represent approximately 0.12% of total equipment inventory.

The fixed assets appearing on Attachment B represent obsolete or non-repairable equipment and furnishings which have been replaced as part of AQMD’s replenishment program and are no longer of use to the AQMD. Staff is recommending that the assets on Attachment B, as in the past, be surplused through the salvage process and disposed of either through auction or donation to nonprofit and charitable organizations.

Resource Impacts

The proposed action will have no impact on the General Fund, but the General Fixed Assets Account Group will be reduced by $733,474.

Attachments

A. Missing Fixed Assets from 1997 Inventory
B. Obsolete or Non-repairable Fixed Assets

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