CHA 0029

                                               



TO: ACADEMIC UNIT HEADS AND STAFF DEPARTMENT HEADS



Re: Operation of Departmental Storerooms



Business & Finance Bulletin BUS-54 establishes overall policy for

the operation of departmental storerooms. In accordance with the

requirements of that bulletin, the attached Departmental

Storehouse Operating procedure has been developed and is hereby

adopted.



Coordinating responsibility for administration of BUS-54 and the

Departmental Storehouse Operating Procedures is assigned to the

Campus Materiel Manager. Operation of departmental stores and

compliance with BUS-54 and the local procedure is the

responsibility of the Department Chairmen.



The procedure applies only to those stores having an inventory of

new and unused stock having a dollar value at cost in excess of

$50,000. All departments operating storerooms with stock value

estimated to be in excess of $10,000 are to report the value of

their inventory to Accounting as of June 30th each year.







                                            Ivan Hinderaker

                                            Chancellor



Attachment

IH:UEM:vs



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                  DEPARTMENTAL STORES OPERATION



Reference:  Departmental Stores with Inventories in Excess of

            $50,000 (Business and Finance Bulletin BUS-54).



The following basic principles shall be recognized as local

procedures in the operation of departmental stores as outlined in

BUS-54.



    I.   Departmental stores shall be operated by the departments

         as a self-sustaining entity primarily for use of their

         own faculty and staff. At department option, the stores

         may be a separate budget or as an integral part of the

         departmental budget. In the latter case, procedures are

         to be established to identify the operation of stores as

         separate from departmental budget, so that reports as

         required elsewhere in the procedure can be prepared and

         the reports audited by those outside the department who

         have the responsibility for coordination.



   II.   Coordinating responsibility for all department stores

         shall rest with the Campus Materiel Manager. He shall

         issue amendments to this operating procedure as needed

         after consulting with the Department Chairman or his

         delegated representative. Such amendments shall be in

         accordance with BUS-54.



  III.   All users shall be recharged at the same rate. The

         recharge rate will be established at a level that will

         reimburse actual expenses including, but not limited to,

         staff, replacement materials and breakage, and operating

         expense.  As an alternate to including staff in the

         reimbursement rate, the department may elect to fund

         staff out of departmental funds.  In this case, the

         recharge rate shall include replacement and breakage,

         and operating expense.



         If desired, a price may be established to permit lower

         price for large volume purchases. The lower price must

         reflect the actual cost of handling larger orders.



   IV.   Inventories are to be verified on a cyclic basis with

         8.33% of the stock verified each month or on an annual

         basis. Inventories are to be maintained at a level which

         will provide service to the department, but will provide

         a reasonable turnover of stock. Stock turnover goals

         should range from two to four times yearly.

         Verifications of inventories will be made by the

         Materiel Manager or other administrative officer

         periodically.



         Inventory adjustments (stock adjustments) are to have

         the written approval of the Materiel Manager.

         Adjustments exceeding $20.00 must be supported by

         written explanation.



    V.   Every effort should be made to hold inventories to a

         minimum consistent with service to the departments and

         to avoid items stocked in Central Storehouse. In

         determining stock levels, the attached tables should be

         used as a general guideline. Other factors, such as

         leadtime, anticipated surges in usage, etc., should also

         be considered.



         Blanket orders against supply agreements shall be used

         to minimize stock levels and reduce effort of

         reordering.



   VI.   Inventories of used materials if co-mingled with new and

         unissued stock, will be plainly marked as USED and not

         included in inventory. If possible, separate locations

         will be arranged to facilitate the identification of

         stock for resale versus the used stocks for circulation.



  VII.   Reports as needed to evaluate performance shall be made

         to the Department Chairman with copy to the Materiel

         Manager. Reports shall include:



         a)   A quarterly inventory report and a listing of new

              items placed in stock.



         b)   A quarterly financial report in a form similar to

              the one used to report storehouse activity.



         c)   A copy of the Semi-annual Distribution of Value

              Report or a listing of those items not moving in

              the last six months, year, and two years.