Fixed Asset Capitalization Policy

Owner	Administration and Finance
Policy Number	2024:02
Supersedes	2001:04
Document Type	Business Policy
Related Documents	Equipment Transactions Form
Contact	Amanda Matheson Vice President, Administration and Finance [email protected]

Content

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1. Policy Statement
2. Scope
3. Procedure for Capitalization
4. Equipment Transactions Form

Policy Statement

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The University capitalizes the original cost of equipment purchases and gifts in kind in the normal course of operations as required by GAAP (Generally Accepted Accounting Principles). The original cost capitalized is depreciated over its estimated useful life. This policy establishes the minimum value threshold for capitalization.

Scope

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Assets acquired by the University. The University capitalizes assets that cost $25,000 and greater except grant funded purchases. See grant policies for more information.

Procedure for Capitalization

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The University will use the Financial System (Purchasing, Accounts Payable and Financial Accounting modules) to identify the original cost of assets acquired by the University. Once an item is identified to be capitalized, an asset record will be established in the Fixed Assets System. The system will record all accounting entries for capitalization, cost changes, depreciation, and disposals.

The Associate Vice President for Finance determines a value that conforms to the Universities objectives while remaining in compliance with applicable pronouncements of FASB (Financial Assenting Standards Board) and GASB (Governmental Accounting Standards Board) and other regulatory agencies.