Policy Library 1 Camino Santa MariaSan Antonio, TX 78228 +1-210-436-3011 Policy Library logo William Joseph Chaminade St. Mary's University, Texas

Approver(s):

Executive Council

Authorizes Release:

Vice President for Administration and Finance

Responsible Area:

Finance Office

Review Cycle:

Annually or as required

Last Review:

March 2019

Related Policies and Additional References:


Overview

This policy pertains to the capitalization, depreciation and disposal of the University’s fixed assets. It also describes the responsibilities that Budget Directors have regarding the fixed assets assigned to their Department. Fixed assets are comprised of all buildings, improvements, and renovations that exceed $25,000; furniture and equipment that have a value of $5,000 or greater; and fiscal year purchases of library books with an aggregate value of $5,000 or greater.

Information Services tracks and manages computer purchases, which must follow the process described in the Procurement of Goods and Services Policy. These purchases are not capitalized unless the value is $5,000 or greater.

Additions and Acquisitions

Most fixed assets are obtained through the purchasing process and must follow the Procurement of Goods and Services Policy. A purchase order must be obtained, approved, and then submitted to the vendor. After the purchase arrives and the invoice is paid, the department will be contacted to provide necessary information about the asset, including location and serial number. An asset tag will be affixed, and the item will be added to the University’s asset records in Banner.

If an asset is donated, a Fixed Asset Status Change Form should be completed using the action code “A”. The form also requires a description of the item, location, and the department that manages the asset. The asset will be recorded at appraised value at the time of the donation. Advancement Services will need be notified, an asset tag will be affixed, and the item will be added to the University’s asset records in Banner.

Deletions, Disposals and Sales

When assets are taken out of service, lost, or stolen, they should be reported to the Controller’s Office using the Fixed Asset Status Change Form. The action code of “D” (disposed) should be entered. If the asset tag number is known, it should be entered on the form; otherwise a description of the asset should be provided. An explanation of the disposal should be provided, and the form should be signed by the Budget Director for that area. Vice President’s signature is also required.

If furniture or equipment requires disposal, Housekeeping should be contacted to have the item removed. Housekeeping will store the discarded items until they can be transferred to another department if possible. If the furniture or equipment is deemed to be unusable, Housekeeping will dispose of it. They will request a copy of the completed Fixed Asset Status Change Form before removing the items.

If computer equipment requires disposal, Information Services should be contacted. A technician will assess the equipment and will determine if the equipment can be reassigned to another department or is obsolete. If it is considered obsolete, Housekeeping will be contacted to dispose of the equipment.

If an asset is replaced, such as in a trade-in, the disposal should be reported on the Fixed Asset Status Change Form. However, assets should not be sold without consulting the Controller’s Office. Although an asset may have been purchased with a department’s budget and assigned to that department, the asset is University property and the department is not free to dispose of or sell the asset without consulting with the Controller’s Office.

If furniture or equipment is lost or stolen, it should be reported to the University Police, as well as the Office of the Vice President for Administration and Finance so that any insurance claims can be filed.

Disposition of Equipment Purchased with Federal Funds

Prior to disposing of assets purchased with federal funds, the Controller’s Office must be notified and a determination made as to who retains title to the equipment. In general, equipment purchased with federal funds becomes the property of the University when delivered. However, under some sponsored agreements, the sponsor retains title to any equipment purchased with sponsored funds. If the title is retained by the sponsor, the agency must be notified prior to transferring, selling or disposing of the equipment. After notification, the agency must approve the action. Any funds received from sale of agency-owned equipment must be returned to the agency.

Change of Location

If the location of furniture or equipment changes, the new location should be reported on the Fixed Asset Status Change Form. An action code of “C”, the description of the asset, the asset tag number, and the new location (building and room number) should be entered on the form, and the form signed by the Budget Director of that area. Change of location for computers should be reported to Information Services.

Asset Inventory

The main objective of the fixed asset inventory is to maintain an accurate accounting of University owned assets. Therefore, approximately once every two to three years, each department’s fixed assets will be inventoried. A list of assets assigned to each department will be provided, and Budget Directors are responsible for identifying the items on the list and making necessary changes to the list if needed. For items that have been disposed, the Fixed Asset Change Form must be completed. The inventory list should then be signed by the Budget Director for that department and returned to the Controller’s Office.

Capitalization

Equipment and furniture are capitalized at the time of purchase, when the invoice is paid, through the Banner Fixed Asset Module. Buildings and renovations are capitalized at the end of the fiscal year, using the date of the project completion. Library books are capitalized in total at the end of the fiscal year.

Depreciation

The University depreciation assets using the straight-line basis beginning in the month of purchase using the following useful lives:

  • Buildings – 45 years
  • Parking lots, walks and drives – 20 years
  • Equipment – 25 years
  • Library books – 5 years

Depreciation is recorded in Banner semi-annually in November and May.

Back to top