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Financial Rep Meeting

Financial Rep Meeting. July 13, 2011. Property Capitalization Threshold Change Michael Williams. What is the change?. Current Definition of a Capital Asset – Tangible personal property which has an acquisition value of $1,000 or more with an expected useful life of one year or more.

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Financial Rep Meeting

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  1. Financial Rep Meeting July 13, 2011

  2. Property Capitalization Threshold ChangeMichael Williams

  3. What is the change? Current Definition of a Capital Asset – Tangible personal property which has an acquisition value of $1,000 or more with an expected useful life of one year or more. Effective July 1, 2011 the acquisition threshold increased to $5,000.

  4. To what types of property does this apply? • Includes: • Tangible personal property, e.g. • Furniture & equipment • Artwork and historical treasures • Motor vehicles and watercraft • Musical instruments • Software (on a per-user basis) • Additions, improvements and other outlays that significantly extend the useful life of an asset • Excludes: • Library materials and books ($250 capitalization threshold) • Buildings ($100K) • Internally generated intangibles, e.g. Software ($1 million)

  5. What is the implementation plan? • Purchase Orders created prior to July 1, 2011 • Property with a cost of $1,000-$4,999 with an asset profile attached will be corrected when the voucher is created. • Property Accounting Services will monitor this process. • Departmental Managers should review their ledgers and notify PAS if they discover a capitalized asset with a cost less than $5K. • Indirect Cost • Sponsored project purchases of property with a cost of $1,000-$4,999 will not incur F&A overhead charges for FY 2011-2012. • All grant proposals should continue to use a $1K capitalization threshold for equipment budgets for FY12. • Budget • Budget Managers should take threshold change into account when budgeting for OCO expenditures in FY12.

  6. What is the implementation plan? (cont.) • Property Management • Property with a cost less than $5K received on or after July 1, 2011 will not be tagged, tracked or physically inventoried. • Previously received property with an acquisition value less than $5K will be exempt from physical inventory. • Departments will continue to be held accountable for property below the $5K threshold. • Contact Property Accounting Services for assistance in tracking these items. • Financial Reporting • GL Account and Purchasing Category descriptions have been updated to remove references to old capitalization threshold of $1,000 • Property capitalized prior to July 1, 2011 with a unit value under $5K will be retired and removed from inventory records in FY12.

  7. Contacts • Budget – Katie Martindale • 645-7164 • kmartindale@fsu.edu • Property Inventory – Julie Bickford • 644-9757 • jbickford@admin.fsu.edu • Purchasing – Karen Gibson • 644-9729 • kgibson@admin.fsu.edu • Sponsored Projects – Roberta McManus • 645-2485 • rmcmanus@fsu.edu • Accounting – Donna Jarriel • 644-9429 • djarriel@admin.fsu.edu

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