Amtrak's Inventory and Property Controls Need Strengthening
CED-80-13: Published: Nov 29, 1979. Publicly Released: Nov 29, 1979.
- Full Report:
GAO has found several weaknesses in Amtrak's inventory and property controls. Amtrak's investment in inventory and property is substantial. The property, including rolling stock, tracks, land, stations, maintenance facilities, office buildings and other items such as furniture and equipment, has been valued at $1.2 billion. The inventory, valued at $92 million, consists primarily of spare parts needed for repair and maintenance operations.
Amtrak's inventory records were found to be largely inaccurate. Physical supply counts by GAO at two stores showed that both the computerized and manual records were inaccurate about half the time. The inaccuracies were largely due to several inventory control problems. Amtrak often made payments to vendors without first being sure that the items were actually received. Because of inadequate protection, many items were taken from storage without documents showing who took them or why. Thus, it could not be determined if the items were used, misplaced, or stolen. Improvement was needed in Amtrak's methods for determining how much of each item to stock and when and how much to order, as well as how to identify and get rid of items no longer needed. Amtrak was not following its own procedures for controlling its property. Property registers were often not maintained, were not accurate, or were not kept up to date. Many property items were not tagged or otherwise identified. Physical inventories and internal audits of property have been limited. The last Amtrak inventory of its property was in 1974. Its only audit of local property records indicated that the records were neither accurate nor properly maintained.
Recommendation for Executive Action
Comments: Please call 202/512-6100 for additional information.
Recommendation: The president of Amtrak should: improve payment controls to assure that items billed for were ordered and received; improve receiving controls and the preparing and processing of receipt documents; improve physical security; establish and monitor record accuracy standards; develop and implement adequate methods for determining stocking levels; and develop an effective system for identifying and disposing of items not needed. He should improve property controls by: requiring each department to properly tag property items and develop and maintain accurate property registers; establishing a regular cycle of physical inventories of property; making sure that everyone responsible for Amtrak property understands the correct control procedures; and increasing internal audit coverage of property.