7455 - ACCOUNTING SYSTEM FOR CAPITAL ASSETS
The Governing Board shall maintain a capital-asset, accounting system. The capital-asset system shall maintain sufficient information to permit the following:
- the preparation of year-end financial statements in accordance with generally-accepted, accounting principles
- adequate insurance coverage
- control and accountability
Capital assets are defined as those tangible assets of the ESC with a useful life in excess of five (5) years and an initial cost equal to or exceeding $5,000. Some items may be identified as “controlled” assets that, although they do not meet all capital asset criteria, are to be recorded on the capital-asset system to maintain control.
Capital assets shall be classified as follows:
- land, buildings (facilities), equipment, and intellectual property (including software) whether acquired by purchase, construction, manufacture, exchange, or through a lease accounted for as financed purchase under Government Accounting Standards Board (GASB) standards or a finance lease under Financial Accounting Standards Board (FASB) standards; and
- additions, improvements, modifications, replacements, rearrangements, reinstallations, renovations or alterations to capital assets that materially increase their value or useful life (not ordinary repairs and maintenance)
Leased capital assets and assets which are jointly-owned shall be identified and recorded on the capital-asset system.
Capital assets shall be recorded at actual, or if not determinable, estimated purchase price or fair market value at the time of acquisition. The method(s) to be used to estimate such price or market value shall be established by the Treasurer/CFO.
The Superintendent shall ensure the proper purchase, transfer, and disposal of capital assets.
Depreciation shall be recorded for funded capital assets using the method(s) agreed upon by the Superintendent and the Treasurer/CFO.
The following information shall be maintained for all capital assets:
- description
- asset classification (land, building, equipment, etc.)
- location
- purchase price
- vendor
- date purchased
- voucher number
- estimated useful life
- estimated salvage value
- replacement cost
- accumulated depreciation
- method of acquisition (purchase, trade-in, lease, donated etc.)
- appropriation
- manner of asset disposal
Useful Lives
Useful lives of fixed assets relate to the life expectancy as used by the specific governmental unit. The Governing Board has established the following general categories of useful lives for its fixed assets:
| Buildings | 40 years |
| Building Improvements | 10-40 years |
| Improvements other than Buildings | 10-20 years |
| Furniture, Fixtures and Equipment: | |
| Hand Tools | 15 years |
| Transformers and meters | 15 years |
| Misc Equipment (Over $500) | 15 years |
| Computers | 5 years |
| Telephones and systems | 10 years |
| Office Machines-typewriters, calculators | 8 years |
| Radio and TV Communication equipment | 10 years |
| Furniture & Fixtures | 20 years |
| Books | 7 years |
| Picnic Tables | 10 years |
| Pump Motors | 10 years |
| Audio Visual | 6 years |
| Mowers & Yard Machinery | 15 years |
| Power Tools | 15 years |
| Autos | 8 years |
| Trucks | 8 years |
| Appliances | 15 years |
| Signs | 10 years |
| Playground Equipment | 10 years |
| Machinery | 15 years |
| Lab Equipment | 10 years |
| Utility Poles | 15 years |
| School Buses | 10 years |
| Fences | 30 years |
Useful lives are assigned to each asset unit or determined on an average for the group. They are based on actual experience, whenever possible, or engineering evidence or practice if the Governing Board has no actual experience. They are expressed in terms of the probable total years of service.
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Ohio Valley Educational Service Center