FIXED ASSETS
Tracy Reda
CAPITALIZATION POLICY
To establish a uniform capitalization policy for equipment and fixed assets that complies with federal, state, and West Virginia University (WVU) reporting requirements. The capitalization policy link can be found at Capitalization Policy.
Capital Assets & Debt Accounting does not require you to tag or submit Asset Acquisition forms for equipment purchased on state and/or research funds if the equipment is less than $5000.
Equipment less than $5000 purchased for departments located with the National Research Center for Coal and Energy will need to have internal tags assigned. Click on the NRCCE Internal Form to complete the paperwork for a piece of equipment purchased for less than $5000. Please remember to attach a copy of the packing slip (signed and dated) or the invoice and provide this to Tracy Reda in rm 302.
The following are not considered assets, even if the price is greater than $1,000.
Complete Asset Detail Form the following scenarios: New Equipment needs Tagged, Change of Location, Surplus, Transfer of DA, or Off-Campus Request needs completed.
EQUIPMENT COMPONENT
The definition of a component is a piece of equipment under $5000, which is an accessory piece or enhances the functionality of a piece of equipment.
A fixed asset is any tangible item with a useful life of at least one year that was acquired at a purchase price of at least:
- State Funded – $5,000 or greater
- Research Funded – $5,000 or greater
The following items are considered assets examples:
- Motor Vehicles
- Computers
- Furniture: office, classroom, lab
- Software costing over $25,000
The following are not considered assets, even if the price is greater than $1,000
- Repair parts for previously tagged pieces of equipment
- Drapes, carpeting
- Software under $25,000
- Immovable equipment which becomes part of the building such as built-in cabinets,
- Furnaces, garbage disposals
Capital Assets does not capitalize the items that comprise, a cubicle work space, however, if a filing cabinet, chair or desk that is moveable is located within the cubicle it would be capitalized.
Complete Asset Acquisition Form – the following scenarios: New Equipment needs Tagged, Change of Location, Surplus, Transfer of DA, or Off-Campus Request needs completed.
Equipment Fabrication.Modification Form Definitions and Instructions
Equipment Fabrication.Modification Form
Asset Acquisition Form
EQUIPMENT COMPONENT
The definition of a component is a piece of equipment under $1000, which is an accessory piece or enhances the functionality of a piece of equipment.
It is also important to remember that a replacement or spare part is not considered equipment and therefore should not be capitalized.
There are three questions to answer to determine whether an item should be capitalized:
1. The cost of the item is greater than state funded $5,000 or Research Funded $5,000
2. The item has a useful life in excess of one year
3. The item can function as a standalone
The questions to ask to determine if item is a component
1. The item has a useful life in excess of one year
2. The item cannot function independently
3. The item enhances or upgrades an existing piece of equipment.
When purchasing equipment or components with a credit card, it is very important that you fax or send by campus mail the itemized invoice or packing slip to Tracy Reda – PO Box 6218 – Fax # 293-2120.
Equipment Components
- Monitor is a component of a CPU
- An internal zip drive is considered a component, however an external zip drive under 1K is not
- An internal modem is considered a component, a modem over 1K that is external should be coded as equipment and tagged if it is going to move to several computers
- Sorters on copy machines are components, however, paper – toner are not (life less than 1 year)
- Printers are not componets, unless they are over the state or research funded amounts and then they are assigned a unique asset number.
Any unit of equipment which is built in, bolted down, plumbed in (not moveable) is not capitalized as an asset. However if the acquisition exceeds $25,000, the entire amount relating to the structural modification is added to the building. - Software can be a component if it is preparing the equipment for its intended use or if the equipment does not function without the software.
Click on the Modification Form to complete the paperwork for an equipment component. Please remember to attach a copy of the packing slip (signed and dated) or the invoice and fax to 293-2120.
CUSTODIAL CONTACT:
Tracy Reda
Research EBO PH: 293-7571
Fax: 293-2120