Army Commissary Accounting for Gains and Losses Needs Improvement

Army commissaries are financed from appropriated funds, a revolving stock fund, and revenues from retail sales. Although by law merchandise must be sold at cost, a surcharge may be added to pay certain operating expenses. Money collected in excess of the amount required to reimburse the stock fund for operating expenses is used for commissary construction and improvements. Except for inventory losses and changes in inventory levels, sales receipts should generally equal the cost of purchases paid from the stock fund.