| (a) Definitions. The following words and terms, when
used in this section, shall have the following meanings, unless the
context clearly indicates otherwise.
(1) Annual physical inventory--The annual capitalized
and controlled personal property physical inventory that a state agency
must conduct once each year in accordance with this section.
(2) Betterment of personal property--An improvement
of personal property that materially increases its serviceability
or useful life, or both.
(3) Capital asset--A possession of the state that has
an estimated useful life of more than one year.
(4) Capital lease--A lease of personal property under
which the lessee substantially assumes the risks and benefits of ownership
as specified under generally accepted accounting principles.
(5) Capitalized asset--A capital asset that has a value
equal to or greater than the capitalization threshold established
for that asset type.
(6) Charitable organization--The term has the meaning
assigned by Civil Practice and Remedies Code, §84.003.
(7) Comptroller--The comptroller of public accounts
for the State of Texas.
(8) Computer equipment--The equipment includes computer,
telecommunications devices and systems, automated information systems,
and peripheral devices and hardware that are necessary to the efficient
installation and operation of that equipment, but does not include
computer software.
(9) Controlled asset--An agency asset the state has
determined as high loss risk to be secured and tracked because of
the nature of the possession. The term does not include a capitalized
asset, real property, an improvement to real property, or infrastructure.
(10) Fiduciary fund--A fund held by a state agency
as trustee of the fund. The term includes pension funds and non-expendable
trust funds.
(11) Fiscal year--The accounting period for the state
government which begins on September 1 and ends on August 31.
(12) Include--A term of enlargement and not of limitation
or exclusive enumeration. The use of the term does not create a presumption
that components not expressed are excluded.
(13) May not--A prohibition. The term does not mean
"might not" or its equivalents.
(14) Personal property--A capitalized or controlled
asset not classified as real property.
(15) Proprietary fund--A self-supporting fund whose
resources are generated through user charges. The term includes enterprise
and internal service funds.
(16) Replacement of personal property--A replacement
of an internal or external part of personal property that allows it
to complete its normal useful life.
(17) Salvage personal property--Personal property that
no longer serves its original purpose because it is depleted, worn
out, damaged, consumed, outdated, or obsolete. The term does not include
personal property that has a remaining useful life.
(18) State agency--A state governmental entity that
manages, administers, or controls personal property.
(19) State employee--An officer or employee of a state
agency.
(20) State property accounting system--The fixed asset
component of the uniform statewide accounting system.
(21) Supplemental physical inventories--The optional
physical inventories that a state agency conducts in addition to the
required annual physical inventory.
(22) Surplus personal property--Personal property in
the possession of a state agency that is not currently needed by the
agency and is not required for the agency's foreseeable needs. The
term does not include salvage personal property.
(23) Trust property--Property not owned by the state
that a state agency temporarily holds on behalf of the owner and is
not used in agency operations.
(b) Exemptions.
(1) Equipment and supplies purchased through programs,
contracts, or grants with the Department of State Health Services.
(A) An item of equipment or a supply is exempt from
the requirements of subsections (c) - (q) of this section if it is:
(i) used to promote and maintain public health;
(ii) is purchased by or for a qualified entity; and
(iii) is purchased through a program, contract, or
grant with the Department of State Health Services.
(B) The exemption ends if the item or supply is returned
to the Department of State Health Services upon the termination of
the applicable program, contract, or grant. When the exemption ends,
the formerly exempt equipment or supply must be reported to the state
property accounting system in accordance with the comptroller's requirements.
(C) A state agency that purchases an exempt item of
equipment or a supply shall develop and maintain internal control
procedures for keeping a complete and accurate inventory of the items
exempt under subparagraph (A) of this paragraph.
(D) In this paragraph, "qualified entity" includes
an individual, a corporation, a local unit of government, and a state
agency.
(2) The Department of Assistive and Rehabilitative
Services.
(A) A material, tool, book, or other necessary apparatus
provided to a client by the Department of Assistive and Rehabilitative
Services is exempt from subsections (c) - (q) of this section.
(B) The Department of Assistive and Rehabilitative
Services shall develop and maintain internal control procedures for
keeping a complete and accurate inventory of the items that are exempt
under subparagraph (A) of this paragraph.
(C) The state auditor may request to review an inventory
required by subparagraph (B) of this paragraph at any time.
(D) An item that no longer qualifies for an exemption
under subparagraph (A) of this paragraph must be added to the state
property accounting system.
(3) Items provided to clients of state agencies.
(A) The comptroller may exempt from the reporting requirements
of this section a material, tool, book, or other necessary apparatus
if the item is provided to a client by a qualifying state agency.
(B) The appropriate state agency shall develop and
maintain internal control procedures for keeping a complete and accurate
inventory of the items that are exempt under subparagraph (A) of this
paragraph.
(C) The state auditor may request to review an inventory
required by subparagraph (B) of this paragraph at any time.
(D) An item that no longer qualifies for an exemption
under subparagraph (A) of this paragraph must be added to the state
property accounting system.
(4) Government Code, Chapter 403, Subchapter L, as
added by Senate Bill 5, 82nd Legislature, 2011, Chapter 1049, §6.07,
does not apply to a university system or institution of higher education
except that Government Code, §§403.273(h), 403.275, and
403.278, do apply to a university system or institution of higher
education.
(A) A university system or institution of higher education
shall account for all personal property as defined by the comptroller
under Government Code, §403.272. At all times, the property records
of a university system or institution of higher education must accurately
reflect the personal property possessed by the system or institution.
(B) The state auditor, based on a risk assessment and
subject to the legislative audit committee's approval of including
the examination in the audit plan under Government Code, §321.013,
may periodically examine property records or inventory as necessary
to determine if controls are adequate to safeguard state property.
(c) Certification of internal state agencies and reporting
state agencies.
(1) General requirement. A state agency must be certified
as an internal state agency or a reporting state agency.
(2) Initial certification. A state agency that has
not been certified before the effective date of this section must
properly complete and submit to the comptroller the form required
by the comptroller. The agency must specify on the form whether the
agency wants certification as an internal state agency or a reporting
state agency. The comptroller shall review the form and consider the
agency's ability to comply with this section before certifying the
agency.
(3) State agency requests for changes in certification.
(A) A reporting state agency may change its certification
to an internal state agency by:
(i) properly completing the form required by the comptroller;
and
(ii) obtaining the comptroller's approval of the change.
(B) An internal state agency may change its certification
to a reporting state agency by:
(i) properly completing the form required by the comptroller;
and
(ii) obtaining the comptroller's approval of the change.
(C) When considering whether to approve or disapprove
a state agency's request for a certification change, the comptroller
shall:
(i) consider the agency's history of complying or not
complying with this section's requirements for the agency's current
certification; and
(ii) determine the agency's capability to comply with
this section's requirements for the agency's requested certification.
(D) This subparagraph applies if the comptroller receives
a state agency's request for a certification change not later than
the 30th day before the start of the next fiscal year. If the comptroller
approves the change, then the change is effective on the later of:
(i) the first day of the fiscal year following the
fiscal year during which the comptroller approves the change; or
(ii) the date the state property accounting system
receives a full and accurate reporting from the agency of its property
balances as of the end of the fiscal year during which the comptroller
approves the change.
(E) This subparagraph applies if the comptroller receives
a state agency's request for a certification change during the last
29 days of a fiscal year. If the comptroller approves the change,
then the change is effective on the later of:
(i) the first day of the second fiscal year following
the fiscal year during which the comptroller receives the request;
or
(ii) the date the state property accounting system
receives a full and accurate reporting from the agency of its property
balances as of the end of the fiscal year following the fiscal year
in which the comptroller receives the request.
(4) Certification changes initiated by the comptroller.
(A) The comptroller may change a state agency's certification
from a reporting state agency to an internal state agency or vice
versa anytime the comptroller determines the change is needed.
(B) If the comptroller changes a state agency's certification
under subparagraph (A) of this paragraph, then the change is effective
on the date specified by the comptroller.
(5) Criteria for certification as an internal state
agency. A state agency may be an internal state agency only if:
(A) the agency determines that it will use the state
property accounting system as its own property accounting system;
and
(B) the agency agrees to maintain a perpetual inventory.
(6) Criteria for certification as a reporting state
agency.
(A) A state agency is a reporting state agency if it:
(i) is not exempt from this section; and
(ii) is not an internal state agency.
(B) A reporting state agency shall modify its property
accounting system to comply with the comptroller's reporting requirements,
as periodically amended.
(C) A reporting state agency shall demonstrate to the
comptroller's satisfaction that the agency has disaster recovery capability.
(7) Senate Bill 5, 82nd Legislature, 2011, §6.07
provides exemptions for universities and institutions of higher education.
(d) Personal property physical inventories.
(1) Frequency and timing of physical inventories.
(A) Except as provided by subsection (m) of this section,
a state agency shall conduct an annual physical inventory of the personal
property and trust property in the agency's possession. The agency
may choose the date of the inventory.
(B) The comptroller encourages a state agency to conduct
each year one or more supplemental physical inventories of the personal
property and trust property in the agency's possession.
(2) Requirements for annual personal property physical
inventories.
(A) When a state agency conducts an annual physical
inventory of the personal property and trust property in the agency's
possession, the agency shall:
(i) ensure that each property item is still within
the agency's possession;
(ii) determine whether the person who has custody of
each property item as indicated on the agency's records still has
custody of the item; and
Cont'd... |
