ANNUAL AUDIT REPORT - Laserfiche WebLink

Browse Search

POLICY FOR CAPITALIZATION AND DEPRECIATION OF CAPITAL ASSETS AND DISPOSAL OF EQUIPMENT ASSETS, EXCESS PERSONAL PROPERTY, AND SCRAP MATERIALS 1. C-% fl e Purpos The purpose of this policy is to establish minimum costs that shall be used to determine for capitalization and depreciation of Capital (Property and Equipment) Assets; and procedures for the disposal of District owned Equipment Assets, Excess Personal Property, and Scrap Materials. 2. Definitions "Capital Asset" is a unit of either Property Asset or Equipment Asset that: (1) has an economic useful life that extends beyond 12 months; and (2) was acquired or produced for a cost of $5,000 or more. Capital Assets must be capitalized and depreciated for financial statement (or bookkeeping) purposes. "Capitalization Amount" is the threshold amount for minimum capitalization and is established by the District at $5,000 for Capital Assets and various building and land renovations/rehabilitations/improvements as reviewed annually. Any items costing below these amount should be expensed in the District's financial statements. "Capital Asset Valuation" is the recorded amount at historical cost as of the date acquired or, if the cost is not readily determined, at estimated historic costs. "Personal Property" includes all manners of materials and items regardless of recorded value, except structures, land and improvements thereto. "Salvage Value" is the value the Equipment Asset, Excess Personal Property, or Scrap Materials is expected to have when it is no longer useful for its intended purpose. In other words, the Salvage Value is the amount for which the Equipment Asset, Excess Personal Property, or Scrap Materials could be sold at the end of its useful life. This value can be based on (1) general guidelines from some professional organizations and industry information (2) internal experience, or (3) professionals such as engineers, architects, etc. I "Scrap Materials" includes appreciable quantities of scrap metal, tin, aluminum, waste material, such as paper, rags, rubber, oil, wood and so forth, that are no longer useful to the District. 1/5/2021