MANAGEMENT OF ASSETS
Contents:
Scope
Key Points
Background
Asset Registers
Investment Registers
Land and Property Assets
Stores and Equipment
Loans of Assets or Stores and Equipment
Annual Accounts
Scope
1. This section gives guidance on the management of assets within the Scottish Administration (i.e. the core Scottish Government (SG), SG Executive Agencies and non-ministerial Executive Agencies / Departments). Other organisations to which the Scottish Public Finance Manual (SPFM) is directly applicable, including bodies sponsored by the SG, should ensure that arrangements consistent with the guidance are put in place.
Key Points
2. Accountable Officers have a duty to ensure that the assets for which they are responsible are properly and well managed.
3. Asset Registers and Investment Registers should be maintained.
4. Systems should be put in place for the management of stores and equipment.
Background
5. Accountable Officers have a duty to ensure that the assets for which they are responsible such as land, buildings or other property - including stores and equipment - are properly and well managed. Robust systems should be put in place to ensure that the accuracy and integrity of information held on registers, databases and inventories is safeguarded and readily available for inspection.
6. The Financial Reporting Unit within the SG Finance Directorate maintains the asset register for the SG but relevant business areas are responsible for the management of their assets and for providing information to ensure that the register is accurate and up to date. Relevant business areas are also responsible for maintaining local asset and investment registers, records of attractive items and systems for the management of stores and equipment.
Asset Registers
7. Under resource accounting and budgeting asset registers are a key part of financial management systems and must be capable of delivering the accounting requirements of the Government Financial Reporting Manual. The registers should contain details of all assets (both current and non-current) owned, whose value or original purchase price is over the organisation's capitalisation threshold. Asset registers should normally be computerised and the widespread use of commercial asset management software packages means that the structure and detail held will be dictated by the software but, as a minimum, information held should cover:
- a physical description of the asset (where appropriate) together with details of serial or registration number;
- regular evidence of physical verification of the asset's existence; and
8. Records of "attractive" items (e.g. those vulnerable to theft) whose value falls below the capitalisation threshold should also be maintained. Inventories of works of art should be kept in accordance with advice provided by the Government Art Collection.
Investment Registers
9. Investment registers recording details of any loans or shares held, including their cost and their nominal value should be maintained. Holdings of share certificates and securities should be checked at appropriate intervals by a responsible officer who should be independent of the officer responsible for holding the securities and the register of them. Checks should also be undertaken when the officer responsible for holding the securities and the register of them leaves post.
Land and Property Assets
10. Physical records (originals or copies) of land and property assets that should be readily available for inspection include: property titles, leases or sub-leases, licences or grazing lets, title plans showing ownership boundaries, the boundaries of different leasehold interests, the line of any servitudes, pipelines or wayleaves, tenancy agreements of any dwellings, grazing lets, planting agreements, mineral extraction rights, lists of any tenants' improvements, and full information on the last rent review including the level of rent, the basis of assessment, and any third party decision, and any photographic record of the condition of the property.
11. The rental charge levied should be assessed by an external chartered valuation surveyor except where the asset is judged to have an annual worth of less than £1000 per annum gross. The rent should be reviewed periodically at the intervals specified in the lease by a suitably qualified chartered valuation surveyor experienced in the type of property and the locality. (Business areas within the Scottish Administration may obtain these services through one of the framework agreements or Service Level Agreements to which the Scottish Administration has access. The SG's Property Advice Division can advise on the most suitable framework agreement to use in particular cases or on the appointment of consultants should a decision be taken for the services to be put out to tender.)
Stores and Equipment
12. Systems should be put in place for the management of stores and equipment. Such systems should be designed to ensure that only necessary stock is kept, at a level appropriate for needs. Stores and equipment are often "attractive" so care should be taken to put in place systems which minimise the possibility of fraud and theft through robust control procedures.
Loans of Assets or Stores and Equipment
13. Loans of assets or stores and equipment should be for a specified period. The terms of loans should be clearly defined, and should cover the question of liability for damage or non-return. As a general rule, a commercial hire or rental charge should be made. Income foregone where individuals or bodies are given the use of resources free of charge or at concessionary rates may constitute a gift under the terms of the guidance on that subject.
Annual Accounts
14. Acquisitions, disposals and losses of assets etc during a financial year should be noted in the annual accounts. Individual losses of more than £250,000 should be noted separately in accordance with the guidance on Losses and Special Payments.
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Page Published / Updated: August 2009