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GAO discussed the Department of State's efforts to improve internal controls over its personal property, specifically whether its: (1) efforts to implement better controls over nonexpendable personal property were sufficient; (2) offices were following property management policies and regulations; and (3) property management controls were strong enough. GAO found that: (1) the offices it visited were not in full compliance with State regulations because they did not have adequate property records, inventories, or replacement methods; (2) the Central Property Management Office had not yet developed a formal regulations monitoring program; (3) some of the locations using State's automated nonexpendable property management application system (NEPA) experienced difficulties in changing from the manual system, and others implemented it ineffectively because of insufficient training and guidance; (4) State was aware that NEPA had internal control weaknesses and requested proposals from software developers for an operating system with adequate controls; (5) State warehouses maintained inaccurate or incomplete records and inadequate physical security over the property stored in them; and (6) because State's regulations do not address domestic warehouses, no one monitors and enforces the requirement to take and reconcile inventories and keep adequate property records.

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