05.116 University Inventories

Vice Chancellor for Business Affairs

Updated April 1, 2026; Updated December 17, 2013; Updated December 1, 2013; Updated July 1, 2007; Effective November 1, 1988; supersedes former Administration Policy No. ACG2.50, “University Inventories”

GASB Codification, Section 1600.127A, Office of the State Controller 101.02 - Statewide Accounting Policy - Inventories; AICPA Audit and Accounting Guide: State and Local Governments, Chapter 8, 8.81

N/A

Controller

Policy Details:

1. Purpose

   To provide guidelines with regard to university inventories, as defined as general supplies and materials, and ensure compliance with Governmental Accounting Standards Board (GASB), Office of the State Controller, UNCW’s Office of the Controller, and other university requirements.

2. Scope

   This policy applies to all UNCW Divisions, Colleges, and Departments holding inventory for resale with an aggregate value exceeding $1,000 with the exception of postage.  Due to its liquidity, postage must be recorded when it exceeds $100 in value. Inventory as defined for this policy includes, but is not limited to, auxiliary stores inventory, pharmacy prescription and over - the-counter drug inventory, and facilities/physical plant shops parts and fuel inventory.

3. Policy

   1. Responsibilities

      Throughout the fiscal year, inventory items may be recorded as expenditures when used (consumption method).  As of June 30, departments meeting the scope of this policy must conduct an annual physical count of the inventories on hand and report the value to the Office of the Controller to record the significant amounts on the balance sheet. Departments must perform this physical inventory and calculate the June 30 value in accordance with instructions provided by the Office of the Controller.

      The Office of the Controller will schedule the appropriate dates/deadlines, spot check the inventory during the counting process, and review calculations used to value the inventory as needed.

   2. Departments Previously Not Required to Perform Inventory Counts

      Any department that meets the scope of this procedure but has not been requested to perform a physical inventory in previous years should contact the Controller by the end of the first week in May. The Office of the Controller will then include the department when scheduling appropriate dates/deadlines for performing the physical count.

      To help ensure university compliance, the Office of the Controller will contact Vice Chancellors annually requesting them to identify any possible new areas that may have inventory meeting the annual inventory requirement.

   3. Inventory Valuation

      The university utilizes the first-in, first-out (FIFO) method for inventory valuation purposes. FIFO is an inventory cost flow whereby the first goods purchased are assumed to be the first goods sold so that the ending inventory consists of the most recently purchased goods. This is the only allowable method to be used when pricing the inventory items. 

   4. Obsolete or Damaged Inventories
      
      Obsolete or damaged inventories should be written down to their lower of cost or market in the period the loss is incurred.
      
      
   5. Computerized Inventory Systems
      
      It is suggested that any inventory system purchased allows for a FIFO valuation method consistent with policy statement C above. Assistance is available from the Office of the Controller to ensure that the systems under consideration allow for this valuation method. If the system chosen does not allow for inventory valuation per university policy, the department must determine how they will convert the system-generated inventory value at fiscal year-end.
      
      
   6. Questions
      
      Any questions on whether a department should prepare for, or be excluded from, a physical inventory should be directed to the Controller.
      
      Any other questions concerning this policy should be directed to the office of the Controller.