Significance and Use LDD is an indicator of the effectiveness of
operations. Excessive LDD can indicate poor internal management
and controls, policy or procedural weaknesses, or lack of
compliance, any one of which can impact entity profitability,
mission performance, or reputation. Addressing and reporting LDD
provides a guideline for action for decision makers. Though the
term equipment is used consistently throughout this practice,
this process may be used for the other classes of property, for
example, material. 1.1 This practice focuses on addressing and
reporting loss, damage, or destruction (LDD) of tangible
property. 1.2 LDD events are key aspects of risk management.
Projecting the possibility or probability of LDD, discovering,
disclosing, reporting, managing, and minimizing LDD is a
critical and economic factor in the success of the owning or
holding entity. This practice also establishes acceptable levels
of LDD. 1.3 LDD events are often discovered as a result of a
physical inventory or other audi