AG 2004 08 16 - Laserfiche WebLink

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Subject: Purpose: Pollo3,' Fixed Assets To define the criteria for determining fixed assets for the County. A fixed asset is tangible in nature and has a useful life longer than one (1) year. A fixed asset is classified as land, land improvements, buildings, furniture and equipment, and vehicles and motorized equipment. It is the County's policy that items of insignificant value or value less than $5,000 are normally expensed instead of being considered a fixed asset. Local governments and public authorities are required by NC General Statute 159-26(b)(8) to maintain "a ledger or group of accounts in which to record the details relating to the general fixed assets of the unit or public authority." Classification of Fixed Assets Fixed assets owned by the County should be recorded in the accounting records. Accounhng classifications of fixed assets are as follows: 3o Land A fixed asset account that reflects the value of land and the rights to land owned by the governmental unit. It includes all land held in fee simple and all rights to land that has no termination date. Buildings and Building Improvements A fixed asset account that reflects the acquisition value of permanent structures owned by the County used to house persons and property. Permanently installed frxtures to or within these structures are considered parts of the structures. The costs of major improvements to structures are included m this account. Land Improvements A fixed asset account that reflects the acquisition value of permanent improvements (other than buildings) that add value to the land or improve the use of the land. Examples of such improvements are: fences, retaining walls, draining systems, sidewalks, parking lots and driveways (Note that when used with fixed assets, the terms "improvement" and "betterment" have different meanings. "Improvements" are fixed assets permanently attached to the land. "Betterments" are additions to or changes in existing depreclable assets intended to increase their efficiency or prolong their useful lives.) Recording of public domain or infrastructure type fixed assets in the accounting records ~s optional. This category of fixed assets includes roads, bridges, curbs and gutters, streets and sidewalks, drainage systems, and similar assets that are immovable and of value only to the County. Equipment, Vehicles and Furniture A fixed asset account that reflects the value of tangible property not permanently affixed to real property, used in carrying out the operations of the governmental unit. Examples of equipment are machinery, furniture and vehicles. Construction in Progress A fixed asset account that reflects amounts expended on an incomplete building or other capital construction project. When the project is complete, the cumulative costs are transferred to another appropriate fixed asset account.