The Examiners of Public Accounts have determined that there should be entries in the general ledger for drugs received and dispensed by each center. The value of the drugs must be included as part of the center's revenues and, when dispensed, as part of the center's expenditures. To accomplish this, the following procedure must be followed:

1. (1) Monthly:

   1. (a) The center must determine the monthly value of drugs received from a prime vendor and enter the value of drugs shipped for the month in the general ledger as revenue.
   2. (b) As drugs are dispensed, a running total should be kept of the amount dispensed and the value of the drugs, using the price list which is provided.
   3. (c) The value of the drugs dispensed to consumers must be entered in the general ledger as an expense at the close of each month.

2. (2) Quarterly:

   1. (a) The value of drugs received should be reported as listed in the general ledger through the Quarterly Receipts and Expenditures Statement. The value should be recorded under "Receipts, Alabama Department of Mental Health/Mental Retardation, Indigent Drugs".
   2. (b) The value of drugs dispensed to consumers in the general ledger should be reported as an expense.

3. (3) Annually:

   1. (a) A physical inventory of drugs on hand should be taken at the close of business September 30 of each year. Determine the value of the drugs on hand, using the prices reflected on the invoices of the prime vendor or those available from the state office. This inventory must be verified by spot checks of selected items by someone designated by the Center Director other than Indigent Drug Program personnel.
   2. (b) The value of the drugs on hand must be entered in the general ledger as an asset of the center.

4. (3) Handling of Out-of-Date Drugs.

   1. (a) With prior approval by the Coordinator of Community Pharmacy Services, out-of-date drugs are to be surrendered to a company that is approved by the Alabama Department of Mental Health/Mental Retardation, engaged in the practice of obtaining credit for out-of-date drugs that are credit-worthy, and is competent in the destruction of non-credit-worthy drugs. Adjustments to the inventory records must be made and the value of the drugs surrendered must be provided to the center's business office. Documentation of the drugs surrendered should be kept in the pharmacy.

Author: Division of Mental Illness, DMH/MR

Statutory Authority: Code of Ala. 1975, §22-50-11.

History: Amended: Filed March 30, 1993. Repealed and Replaced: Filed October 28, 1998; effective December 3, 1998.