Departmental Business Management Guide - Equipment & Fixed Assets

Contents

• Overview
• University Guidelines
• Internal Controls
• Departmental Responsibilities
• Resources

Overview

University property (also known as capital assets or fixed assets) generally consists of land, buildings, infrastructure and other improvements, furniture and equipment, library resources, works of art and historical treasures, and construction in progress. Property is recorded at cost at the date of acquisition or at estimated fair value on the date received in the case of donations.

Additions and improvements to real property that significantly extend the useful life of an asset are also capitalized. Other costs incurred for repairs and maintenance are expensed as incurred. The University has a capitalization threshold of $1,000 for all tangible personal property and $100,000 for buildings and other improvements.

The Property Accounting Services section of the Controller’s Office maintains the official records for all University property.

University Guidelines

Property Accounting Services (PAS) is responsible for:

• Establishing policies and procedures that help ensure accountability for and the safeguarding of University assets
• Ensuring compliance with applicable laws, rules and internal policies and procedures related to University property
• Coordinating the annual physical inventory
• Accounting for acquisitions, transfers and dispositions of tagged property
• Maintaining the depreciation of tangible property over the proper estimated useful life
• Maintaining the property records in the OMNI System

The President is ultimately responsible for all University property, with this responsibility entrusted to the Vice Presidents and Deans/Directors or their delegates.

Property may not be disposed of (sold, scrapped, cannibalized, donated or abandoned), removed from campus locations, physically transferred, loaned, or exchanged by any department without proper approval of the University Controller via PAS. Departments are responsible for safeguarding all equipment and other fixed assets assigned to their organization, including items no longer needed, until the property is properly disposed of according to University policy. Under no circumstances should fixed assets be thrown away. (Policy OP-D-2-F – Property)

Internal Controls

• Ensure proper segregation of duties. The person assigned the role of Inventory Taker should not also be the Property Manager or Property Custodian.
• Ensure proper authorization of the acquisition, disposition, transfer, exchange, removal, or location change of physical property.
• Verify the completeness, accuracy and validity of property accounting records through the performance of an annual inventory of departmental fixed assets.
• Maintain the physical safeguarding and security of departmental property by ensuring that capital assets are reasonably protected against theft and vandalism.
• Provide safeguards to protect confidential data. Properly wipe (or “scrub”) the hard drives of computers that are to be disposed.
• Properly notify Property Accounting Services and the University Police of any missing property items in a timely manner.

Departmental Responsibilities

• Effectively managing and safeguarding your assets
• Ensuring the University’s assets are marked in accordance with applicable policies and procedures (OP-D-2-F6)
• Providing non-accounting information in a timely manner to the Property Accounting Services department for updating the OMNI System
• Performing an annual inventory of assets in your custody
• Assigning an individual to each of the following roles (whenever possible, the same employee should not be assigned more than one role):
  • Property Manager – Authorizes any transfers or disposals of departmental assets
  • Property Custodian – Identifies and tags University property and maintains departmental property records
  • Inventory Taker – Maintains asset-related internal controls and performs the annual physical inventory of departmental property
• Ensuring property staff attend at least one annual inventory training class.

Resources

• University Policy OP-D-2-F – Property
• Property Accounting Services
• Frequently Asked Property Questions
• Asset Management Training
• General & Construction Accounting

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