BOP Program Statement 8563.07 § 17

assign an employee(s) to take the required physical inventory of

M&E and sensitive equipment. For internal control purposes,

employees participating in physical inventories must not be the

same individuals who are responsible for such equipment;

however, these personnel may assist in locating, identifying and

reconciling the physical inventory. Neither are the employees on

the inventory team to have responsibility for the record keeping

process.

Before actually taking the inventory, Business Office staff are

to prepare a list generated from Millennium to be given to the

person taking the inventory indicating:

• the type of equipment,

• equipment number,

• serial number,

• quantity, and

• responsible cost center.

The employee, accompanied by the individual assigned

responsibility for the equipment, must then perform the

following:

a. Inspect each item at a location and check off the item on

the list as encountered. Items are to be located and

cross-referenced to the list. If an item is not on the list, a

member of the inventory team is to note:

• the type of machinery/equipment,

• the FPI equipment number,

• the serial number,

• the quantity, and

• the location of the equipment.

At this time an attempt is to be made to locate any items on

the list which have not been found. If the item location differs

from that on the list, deviations are to be noted. Any other

types of discrepancies are also to be listed on the exception

list. This step is to be performed at each location where M&E

are located.

PS 8563.07

6/13/2001

Page 17

b. After the fixed assets’ physical inspection is complete,

the employee(s) must compare the results per the original list of

assets and the exception list to the Master Assets Record. All

differences are to be noted and incorporated into a written

report and forwarded to:

• the AW(I&E)/SOI,

• Factory Manager, and

• Business Manager.

c. The Factory Manager must investigate any discrepancies with

the employee assigned the responsibility for the missing fixed

assets, and forward a written explanation for all deviations to

the AW(I&E)/SOI within two weeks.

d. Upon receiving the Factory Manager's report, the

AW(I&E)/SOI must appoint a Board of Survey to:

• review the Factory Manager's response,

• recommend actions to be taken, and

• oversee the implementations of those recommended actions.

e. The AW(I&E)/SOI must forward to the Business Manager the

Report of Survey (if applicable), and any supporting

documentation along with a written list of the necessary

adjustments. Then, the Business Manager or designee is to adjust

the Master Assets Record accordingly. Any adjustments must

reference the appropriate Report of Survey number.

f. Annual equipment inventories are to be completed using the

Physical Inventory List by Cost Center from Millennium. A signed

copy of the report is to be mailed to the appropriate Field

Financial Administrator in FMB and a copy with supporting

documentation kept on file at the location for three years or

until the next program review, whichever is later.

/s/

Kathleen Hawk Sawyer

Director