Purpose
Given that fixed asset accounting is an important part of the stewardship responsibility of school officials and the care of school property is a legal responsibility of school officials, an inventory control system shall be established for all tangible fixed assets owned or possessed by Guilford County Schools. The purposes for fixed asset accounting are the following:
1. to safeguard the sizeable investment in fixed assets against waste, loss, or misuse,
2. to fix responsibility for the custody of the fixed assets, and
3. to assist management in the formulation of adequate policies dealing with acquisition, maintenance, retirement, and replacement of fixed assets.
Definition of Fixed Assets
Fixed assets are items of tangible property, both real and personal, having a value of more than $5,000 and an estimated useful life of one year or more as distinguished from intangible property, such as money or securities, and consumable tangible property such as school and office supplies. The revised base of $5,000 shall be effective July 1, 2001 and shall be adjusted as needed in subsequent fiscal years in accordance with the Local Government Commission and/or the Government Finance Officers Association (GFOA) capitalization threshold recommendations for local governmental units.
Categories of Fixed Assets
For the purpose of accounting and inventorying fixed assets, they shall be divided into categories defined as follows:
A. Land - a fixed asset account which reflects the value of land and the rights to land owned by the school system.
B. Land Improvements - a fixed asset account which reflects the value of permanent improvements, other than buildings, which add value to the land or improve the use of the land. Examples of such improvements include but are not limited to the following: fences, retaining walls, drainage systems, sidewalks and driveways.
C. Buildings - a fixed asset account which reflects the value of permanent structures owned by the school system which are used to house persons and property.
D. Equipment - a fixed asset account which reflects the value of tangible property, not permanently affixed to real property, which is useful in carrying out operations of the school system. Examples of equipment include but are not limited to the following: machinery and tools, furniture and accessories, appliances, business machines and computers.
LEGAL REFERENCE: G.S. 115C-523
Note: This Administrative Policy replaces former Board Policy DIC and became effective July 1, 2001.
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