Federal Reports

Our objective was to evaluate the effectiveness of the company’s processes and controls for managing and safeguarding its inventory. We found that the Procurement and Supply Chain and the Mechanical departments recently began improving inventory management, but they continue to face challenges strategically managing Maintenance-of-Equipment inventory in ways that have operational, customer service, and financial impacts. For example, the company faces challenges in achieving an appropriate inventory balance, providing an effective ordering system, and safeguarding inventory from risk of loss or theft. We also identified $14.4 million in inventory items that the company will likely never use again—funds that Amtrak could have put to better use. We recommended that the company implement processes to improve inventory data, develop strategic inventory goals, assess the costs and benefits of carrying surplus and obsolete inventory to determine which materials to sell or scrap, and implement processes to safeguard inventory.