If the book value is not known, the asset is recorded at its fair market value. The straight line method will be used in accordance with GSA guidance, unless this method results in misleading or inaccurate information. The bureau finance officers are responsible for determining whether an alternative method is required, and if so, for defining the method and life to be used. Any alternative method used must be disclosed in the financial reports. 7-30 Inventories Inventories include assets held for resale or for use in manufacturing.
Supplies are to be expensed when purchased.
The value of inventories accounts must be confirmed periodically through statistical sampling of the physical inventory items. The bureau finance officers are responsible for determining the frequency and nature of the physical inventory necessary to ensure that accurate inventory accounts are maintained and that the inventory is physically safeguarded. Inventory items are recorded as an asset when purchased and an expense when sold or used. Inventories of unique items which are each of significant cost are to valued using the specific identification or inventory pool methods. Any requests for exceptions must include a cost benefit evaluation and be approved by the bureau CFO .