...
- What makes an item capitalized in inventory?
- It must meet the capitalization criteria stored in Core>Fiscal Years. If you only have a dollar limit, the item's original cost must meet or exceed the dollar limit. If you only have a life limit, the item's life expectancy must meet or exceed the life limit. If you have both a dollar and life limit, the item's original cost AND life expectancy must be met in order for the item to be capitalized.
- How do I change the capitalization criteria if my GAAP flag is checked?
- Users with INV_STANDARD and INV_GROUP_MANAGER roles are able to run this option. Under the System menu, the Capitalization Criteria option is used to change the capitalization criteria, dollar amount and/or life limit, for districts that have their GAAP flag checked. Once completed, the capitalization criteria stored under Core>Fiscal Years for that fiscal year will be updated to reflect the new dollar amount and/or life limit. A detailed report, sorted by tag number, will be generated including the fund, function and asset class, capitalization status and the old and new beginning balance amounts for each item that was changed. A summary recap, subtotaled by asset class, function and fund total groups is included as the end of the report.
- By changing the dollar capitalization threshold, items that were capitalized at the beginning of the year may no longer be capitalized; or, items that were not, may now be capitalized. This will either increase or decrease the beginning year balances depending on whether the threshold is decreased or increased. The problem is that the prior fiscal year's ending balance and the current fiscal year's beginning balance will not be the same. The report generated should be retained for auditing purposes. Changes in capitalization criteria are also audited on the system
- If increasing the cap threshold, the ENTIRE org cost of an item that is no longer capitalized will appear as a negative adjustment on the GAAP change schedules. Beginning Balance doesn’t get affected
- If decreasing the cap threshold, the ENTIRE org cost of an item that is now considered capitalized will appear as a positive adjustment on the GAAP change schedules. Beginning Balance doesn’t get affected.
- The detail option of the GAAP change schedules (Schedule of Change in Fixed Assets and Schedule of Change in Depreciation) will include the tags that were affected from the cap threshold changes.
- Where do the amounts included in the 'adjustment' column of the GAAP Schedule of Change reports come from?
These items can appear in this column for the following reasons:
- The "error adjustment" flag on some corresponding transaction (acquisition, disposition, transfer) record has been checked.
- An item that did not meet the capitalization criteria at the beginning of the year may have had an acquisition record posted to it. If this acquisition updated the original cost to the point of now meeting the capitalization threshold, the total original cost will now If an existing item had additional an acquisition(s) entered during the year changing it from non-cap to capitalized, the additional acquisition(s) amount will appear in the acquisition column and the rest of the org cost of the item will appear as a positive amount in under the adjustment column.An item that was capitalized at the beginning of the fiscal year may have had a negative acquisition record posted to it. If the adjusted original cost no longer meets the capitalization threshold, the amount will show as a negative amount in the adjustment column The beg balance should not be affected.
- If an existing item had additional negative acquisition(s) entered, changing it from capitalized to non-capitalized, the item’s entire original cost will display as a negative adjustment in the adjustment column to negate the item and essentially remove the item from the GAAP schedule since it is no longer capitalized.
- An asset that has been entered as a lot (more than one item) and is capitalized at the beginning of the year may have been split into more than one lot during the year. If the original cost of one (or more) of the sublots no longer meets the capitalization threshold the amount(s) will show as a negative amount in the adjustment column.
- What happens on the system if I re-open a closed period?
- The system will allow you to post transactions (items, acquisition, dispositions and transfer transactions) using dates within the open period. Please note, when re-closing the period, a new zipped report bundle for that year will be created. Depending if transactions were entered during the re-opened year, the newly generated report bundle reports will no longer match the prior report bundle due to the new transactions posted in the re-opened year. LTD figures will be recalculated and the new year beginning balances adjusted based on any changes made in the re-opened period that could affect those figures.
How do I record Assets that are Construction-In-Progress like a building project?
For those assets that are related to a building project currently in progress, the district does have the option of entering these into the inventory system using a construction in progress (CIP) asset class of 0800. CIP tags should have their depreciation method set to "NONE" so that depreciation is not tracked until after the construction is complete and the assets are in use. Once the building project is complete, the district can create transfer transactions to change the asset class from 0800 CIP to the asset class it is now associated with and possibly the function code if the asset is marked as 5500 (building acquisition & construction services) to the function code the asset is now being used for. Any capitalized assets that have transfer transactions will be reflected on the GAAP reports. For example, on the Scheudle Schedule of Change in Fixed Assets report (sorted by asset class), if transferring several items from 0800 to 0200 asset class, the transfer-out amount will be reflected under the 0800 asset class and the transfer-in will be on the 0200 asset class.