The In Service phase includes:
- Utilization and maintenance
- Movement
- Off-campus equipment
- Location of equipment
- Physical inventory
Every asset must have a current location recorded, according to federal requirements. If equipment is moved, the new location must be recorded. Generally, there should be a direct relationship between the location of an asset and its use. Location impacts risk management reporting, accountability, tracking, and the indirect cost rate calculation.
Use of Stanford or Sponsor-funded equipment off campus is a privilege, not a right. If equipment will be used in a location that is not part of Stanford (i.e.; someone's home), it must be recorded on an Off Campus Equipment Verification Form and must be used in direct support of a sponsored project or Stanford work. This form is available on the DPA Update site, and your DPA will help you with it.
If equipment must be taken out of the country, there are additional requirements. The DPA should be contacted for assistance as soon as the travel destination is known.
Assets must be utilized for the purpose for which they were acquired. Maintenance and calibration must be performed as necessary to maximize the life of the asset and the associated records must be retained.
If you are loaning equipment to another institution, contact your DPA and they will help you with the loan process.
Physical inventory
Note: physical inventory of capital equipment is very important. The physical inventory:
- Is conducted on biennial, cyclical schedule
- Validates effectiveness of property system for compliance
- Verifies physical attributes of asset, condition, status and location
- Is used as financial reporting base
- Uses active items as depreciation base
- Is used as indirect cost recovery base
Stanford's physical inventory cycle takes two years to complete. A team of inventory specialists from the Property Management Office scan tagged assets on campus and at our offsite facilities. They also identify capital equipment that may not have been tagged. The purpose of the physical inventory is to verify the existence, location, status, and condition of assets, and to verify the accuracy of records.
The physical inventory process is a mechanism by which the University is able to check the effectiveness of its property management systems and procedures. Inventory results of equipment on sponsored projects must be reconciled and reported. If items are not found, Stanford may be required to pay for them. A pattern of continuing losses could result in additional audit scrutiny, as well as liability for asset replacement. Additionally, the approval rating of Stanford’s property system can be placed in jeopardy.
There are various methods by which an inventory is conducted. For example, wall-to-wall inventories in which every asset in the department is scanned, or stratified where a sampling of assets is inventoried.
Check with your DPA to obtain a checklist and other tools to help you prepare for physical Inventory. You can also get a copy of the schedule to see when your department will go through this process.
