Interim: Capital Equipment and Maintenance Repair and Operations Physical Inventory Review Extension

Original Issuance Date:         April 1, 2020

Last Revised:                             June 18, 2020

Expiration Date:                       December 31, 2020

1.     Interim Policy Purpose

This interim policy provides an extension for the current cycle of biennial physical inventory review of capital inventory and the annual physical inventory requirement of maintenance repair and operations (MRO) inventory. UW System Administration (UWSA) understands that during the COVID-19 pandemic, resources are being diverted to activities other than employees’ routine activities and staff who conduct the inventory may be working remotely. As such, this interim policy provides institutions additional time to complete their inventory review.

2.     Related System Administrative Policies:

This interim policy action temporarily amends portions of SYS 334, Accountability for Capital Equipment, Section 6.C. and SYS 323, Maintenance Repair and Operations Inventory, Section 6.A. and 6.C.

3.     Scope

This interim policy action applies to all UW institutions with (1) a capital equipment physical inventory review in 2020 and their asset managers and the institution personnel who are trained in statistical sampling who are responsible for completing the biennial physical inventory of capital equipment; and/or (2) a MRO annual physical inventory requirement in 2020 controlled by the facilities management units and auxiliary units.

4.     Definitions

Capital Equipment: Any single asset which has an acquisition cost of $5,000 or more and a useful life of at least two years, whether purchased outright, acquired through a capital lease or through donation. It also includes certain constructed or fabricated items and certain component parts with an aggregate value of $5,000 or more. It does not include real property (land), software or library holdings.

MRO (Maintenance, Repair, and Operations): MRO stands for Maintenance, Repair, and Operations. This type of inventory is used to keep an institution’s infrastructure and equipment in good working order. It includes, for example, spare parts and products such as nuts, bolts, paint, lubricants, janitorial supplies, lighting fixtures, safety supplies, sidewalk salt, batteries, motors, pneumatics, plumbing supplies, parts leftover from capital projects at UW institutions and parts that are included in the burden rate.

5.     Interim Policy Statement

A. Capital Equipment Physical Inventory Report Extension

1. 1. The deadline for conducting the physical inventory review for capital inventory is extended by up to one year to allow institutions additional time to complete the review.
      1. E.g.: if an institution’s next biennial physical inventory review was due to be completed June 30, 2020, the deadline is now extended to June 30, 2021.
   2. This extension is only applicable for institutions whose capital equipment physical inventory review was due to be completed in 2020.
   3. This does not amend the required elements of the physical inventory. The review should still be conducted by the institution’s personnel who are trained in statistical sampling and who have no direct responsibility for managing the capital equipmentbeing sampled (unless that responsibility is on an institution-wide basis). The property selected for the inventory must follow the requirements listed in the grid of SYS 334, Accountability for Capital Equipment, Section 6.C. Any discrepancies between the capital equipment listed in the inventory records and the reviewed equipment should be investigated to determine the cause of the difference.

B. Maintenance Repair and Operations Physical Inventory Requirement Extension

1. 1. The deadline for conducting the annual physical inventory for MRO inventory is extended by up to one year to allow institutions additional time to complete the review.
      1. E.g.: if an institution’s next physical inventory review was due to be completed June 30, 2020, the deadline is now extended to June 30, 2021.
   2. This does not amend the required elements of the physical inventory, which are identified in SYS 323, Maintenance Repair and Operations Inventory, Section 6.A.
   3. This extension does not exempt institutions from the annual reporting requirement of MRO inventory values according to the UW System Administration’s Controller’s Office according to the Year End Reporting Requirements for Inventories listed in SYS 323, Maintenance Repair and Operations Inventory, Section 6.C.

6.     Supplemental Documents

None listed.