purchase amount of the missing items was over $1.8 million. We used a nonrepresentative selection methodology for testing accountable property because purchase card data did not always contain adequate detail to enable us to isolate property transactions for statistical testing. Because we were not able to take a statistical sample of these transactions, we were not able to project inventory failure rates for accountable and pilferable property. Similarly, because the scope of our work was restricted to purchase card acquisitions, we did not audit agencies’ controls over accountable property acquired using other procurement methods. However, the extent of the missing property we are reporting on may not be restricted to items acquired with the government purchase cards, but may reflect control weaknesses in agencies’ management of accountable property governmentwide.
The lost or stolen items included computer servers, laptop computers, iPods, and digital cameras. Our prior reports have shown that weak controls over accountable property purchased with government purchase cards increases the risk that items will not be reported and accounted for in property management systems. We acknowledge agency officials’ position that the purchase card program was designed to facilitate acquisition of goods and services, including property, and not specifically to maintain accountability over property. However, the sheer number of accountable property purchases made “over the counter” or directly from a vendor increases the risk that the accountable or pilferable property would not be reported to property managers for inclusion in the property tracking system. Unrecorded assets decrease the likelihood of detecting lost or stolen government property. In addition, if these items were used to store sensitive data, this information could be lost, stolen, or both without the knowledge of the government. Failure to properly account for pilferable and accountable property also increases the risk that agencies will purchase property they already own but cannot locate—further wasting tax dollars.
Although each agency establishes its own threshold for recording and tracking accountable property, additional scrutiny is necessary for sensitive items (such as computers and related equipment) and items that are easily pilfered (such as cameras, iPods, and personal digital assistants (PDA)). Consequently, for this audit, we selected $350 as the threshold for our accountable property test. Standards for Internal Control in the Federal Government provides that an agency must establish physical control to secure and safeguard vulnerable assets. Examples include security for, and limited access to, assets such as cash, securities, inventories, and equipment, which might be vulnerable to risk of loss or
GAO-08-333 Governmentwide Purchase Cards