State auditors recommend the Office of the State Comptroller strengthen oversight of its physical inventory process after a review found $2.84 billion worth of assets were not inventoried properly in 2025.
State law requires each agency to conduct an annual physical inventory of all property. Failing to do so can result in a reduced ability to ensure the items’ existence, location and safeguarding of state property, auditors said in a report released this week.
Fifty-seven agencies report annual inventory information to the comptroller, for assets totalling $8.8 billion. Just under 40% of them failed to do a physical inventory in fiscal year 2025, auditors noted. Just over 12% had no physical inventory date at all in Core-CT, the system where inventories are recorded, auditors said.
Agency officials said they disagreed with this finding, noting that Core-CT does not require a physical inventory date for an entry, which can lead to that information lacking despite a physical inventory having been completed.
The audit, which covered fiscal years 2023, 2024 and 2025, also highlighted outdated guidelines, obsolete terminology and inconsistencies.
The agency’s Internal Control Guide had not been updated since 2011, and the State Accounting Manual had not been updated since 2016, auditors noted.
“We found guidance documents were outdated, not aligned with current internal control frameworks and accounting standards, and did not consistently incorporate updates to state policies, systems, and reporting requirements,” auditors said in their report.
The comptroller’s office said it is in the process of updating its state manual and those updates are expected to be completed this month. As for the Internal Control Guide, the agency has made significant efforts to move toward a new publication to help guide agencies on internal controls, officials said.
Finally, auditors noted that the comptroller’s office did not adequately document compliance with software inventory and software asset management requirements for its $109.9 million in
capitalized software. This finding was also noted in a prior audit going back to 2020.
“The OSC maintains a listing of its software inventory but neglected to sign off on the report to
properly document the completion of physical inventory,” agency officials said in their audit response. “The OSC will ensure that proper documentation is maintained to support the physical inventory of its software.”
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