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Capitalization of Moveable Capital Equipment

Effective December 26th, 2014, OMB Circulars A-21, A-110 and A-133 will be replaced by regulations under the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (also known as the Uniform Guidance).  Please refer to the University’s Uniform Guidance website http://spa.columbia.edu/uniform-guidance for further details that may supersede information outlined in this policy.  Revised policies will be posted once they are available. 

 

Policy Statement

This policy is intended to provide assistance in determining the proper accounting for capitalization of moveable capital equipment (also referred to as capital equipment) owned by Columbia University (the University or CU), titled to the University, under the custody of the University, or for which the University is accountable to the federal government and other sponsors.  Relevant procedures are contained in the Property Manual.

Reason for the policy

This policy provides the guidelines for the capitalization of moveable capital equipment.

Primary guidance to which this policy responds

This policy responds to good business practices and Financial Accounting Standard Board (FASB) and Generally Accepted Accounting Principles (GAAP) requirements for recording and reporting capital assets and depreciation expenses. The federal regulations to which this policy responds include:

  • FAR 52.245-1, Government Property, Parts 35, 45, and 52
  • OMB Circular A-21: Cost Principles for Educational Institutions
  • OMB Circular A-110: Uniform Administrative Requirements for Grants and Agreements With Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations (Relocated 2 CFR 215)
  • OMB Circular A-133: Audits of States, Local Governments, and Non-Profit Organizations

Roles and responsibilities

1. Controller's Office

The Columbia University Controller's Office is responsible for the maintenance of this policy and for responding to questions regarding the policy.  Responsibility for the capitalization of moveable capital equipment is shared by two groups within the Controller's Office: Capital Asset Accounting (CAA) and Research Policy & Indirect Cost (RPIC).  This structure is designed to ensure both financial and government policies and procedures regarding equipment are addressed. 

  • Capital Asset Accounting (CAA) CAA is the primary group responsible for capital equipment management at the University. The CAA Property Manager serves as the primary liaison to schools and departments for all capital equipment related processes and is responsible for ensuring compliance with Generally Accepted Accounting Principles and government regulations for capital equipment management at the University.
  • Research Policy & Indirect Cost (RPIC) The overall responsibility of RPIC is to provide annual and final property reports for Government Owned/Furnished Equipment and other agencies or groups.

2. Custodial Departments

A departmental equipment coordinator or equivalent is responsible for the initial determination of the equipment as capital equipment.

3. Procurement Services

Three areas in Procurement Services are involved in the capital equipment cycle: the Purchasing Department, Accounts Payable Department and the P-Card program.

  • Purchasing Department Responsible for tracking and monitoring operating and capital lease data charged to Subcode 6117- Major Moveable Equipment Lease/Purchase. 
  • Accounts Payable Responsible for providing Capital Asset Accounting (CAA) with quarterly reports of payment activity charges to Subcode series 61XX and 63XX.
  • P-Card Program Responsible for monitoring capital equipment purchases on the P-Card and providing quarterly reports to CAA.

Revision history

This policy was originally distributed in January 1983. It was revised in January 1990 raising the capitalization threshold from $500 to $2000 and in July 2008 to $5,000.

Who is governed by this policy

This policy applies to all individuals who have custody, use or control capital equipment owned by the University, titled to the University, under the custody of the University, or for which the University is accountable to the federal government and other sponsors.  Covered individuals include, but are not limited to, faculty, staff, students, contractors, consultants, those working on behalf of the University and/or individuals authorized by affiliated institutions and organizations. 

Who should know this policy

Anyone who has custody, uses or controls capital equipment owned by the University, titled to the University, under the custody of the University, or for which the University is accountable to the federal government and other sponsors. 

Exclusion or special situations

Real property (land & buildings), land and building improvements, building components, fixed assets (equipment affixed to real property), software, or minor equipment with a total acquisition cost of less than $5,000 are not covered under this policy.