6640 Capital Assets Accounting Policy – GASB 34

The District defines capital assets as non-consumables assets with a normal service life of more than two years. In order to provide for the proper control and conservation of district property, the Superintendent or designee shall maintain Inventory Records and account for Capital Expenditures in accordance with the following guidelines:

Inventory Records:

  • All equipment items costing in excess of $1,000 shall be inventoried.
  • All non-equipment capital assets costing in excess of $15,000 shall be inventoried.

Capital Expenditure Accounting:

  • Fixed assets having an estimated useful life of at least two years following the date of acquisition will be capitalized.
  • Capitalization thresholds will be applied to individual fixed assets rather than groups of fixed assets.

Note: Property inventory requirements and capitalization thresholds are different subjects that are commonly confused because of their overlapping terminology.

  • An inventory is an itemized list for tracking and controlling property.
  • Capitalization is an accounting treatment whereby an item is recorded as a long-term asset on the balance sheet rather than as a consumable expense of the current period.

The following information must be maintained on the equipment/fixed asset inventory:

  • Name and description of property
  • Location of equipment
  • Serial number and other identification number
  • Cost of the asset at acquisition
  • Acquisition date

Capitalization of Assets:

  • Equipment items that cost more than $5,000 will be capitalized and depreciated for GASB 34 reporting purposes.
  • Equipment items costing less than $5,000 shall be expensed for GASB 34 reporting purposes.
  • All non-equipment capital assets costing in excess of $15,000 shall be capitalized and depreciated for GASB 34 reporting purposes.
  • All non-equipment capital assets costing less than $15,000 shall be expensed for GASB 34 reporting purposes.

Donated items will be capitalized at a fair-market value on the date of the donation.

Some assets individually may fall below the capitalization threshold but may be purchased in large quantities by the district. Examples include computers and electronic devices at their individual cost. The district may choose to capitalize these assets as groups.

All assets will be depreciated using the straight-line method. Residual value will be considered.

Useful lives will be determined in the year of purchase based on general guidelines obtained from professional organizations and asset’s present condition. Depreciation expense will be calculated beginning in the year of acquisition.

Adopted July 6, 2009

Revised and Adopted June 18, 2013

Reviewed and Adopted December 10, 2019

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