Have you consulted the Museum Store Association about this?  http://www.museumdistrict.com/





From: Museum discussion list [mailto:[log in to unmask]] On Behalf Of Jay Smith
Sent: Wednesday, January 27, 2010 3:14 PM
To: [log in to unmask]
Subject: [MUSEUM-L] Depreciation Formula for Museum Gift Shops
Importance: High


To All:

Our museum is owned and operated by a municipality that just completed its annual audit, in which the auditor cited the Museum for failing to have a depreciation formula in place for items in the Gift Shop Inventory that had not sold - some of which could be as old as 7-10 years.   These "older" items remain on our books at their original valuation from our vendors.   The audit finding indicates that these items inflate the value of the gift shop inventory and due to age are not reflective of their respective fair market value(s).

Just for some context, we are not talking about a large dollar value of our inventory, and the items  are fairly common stock such as signed prints from artists, postcards, some books, and t-shirts from a blockbuster exhibit from several years ago.   Additionally, these are items that, primarily, are materials inherited from the transfer of ownership from a private business to municipal management that occurred just shy of five years ago.

We will be trying (hopefully) to sell the materials in question at a discounted rate (the easiest answer) but it is difficult to imagine that we will move all of the items (especially the postcards).  I understand that a typical for-profit business would write off the materials, or but municipal regulations will not allow that practice.

So my question to you all is this:  Does anyone employ a depreciation formula for GIFT SHOP ITEMS or items purchased with the intent of resale?  Additionally, I would like to know if anyone uses software that includes a depreciation formula in its gift shop program?

Thank you all in advance for your input and assistance, and please feel free to reply offline at [log in to unmask]<mailto:[log in to unmask]>


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