Title: 2.10 Capitalization of Tangible Assets | Financial Policies
Headings: 2.10 Capitalization of Tangible Assets
2.10 Capitalization of Tangible Assets
Last Revised Date
PHYSICAL PLANT ACQUISITIONS:
LAND
LAND IMPROVEMENTS OTHER THAN BUILDINGS:
UTILITIES:
TELECOMMUNICATIONS NETWORK SYSTEM:
BUILDINGS AND SPORTS FACILITIES:
REMODELING AND BETTERMENTS vs. MAJOR MAINTENANCE AND REPAIRS
LEASEHOLD IMPROVEMENTS:
PUBLIC ART
CONSTRUCTION IN PROGRESS:
SPECIAL CONSIDERATIONS:
LIBRARY ACQUISITIONS:
EQUIPMENT ACQUISITIONS:
FABRICATION: See 5-EQUIPMENT FABRICATION.
SPECIAL CONSIDERATIONS:
ARCHIVES, HISTORICAL MATERIALS, ART, AND OTHER SPECIAL COLLECTIONS
DISPOSITION OF MATERIALS:

Content: The reworking of an existing building or portion of an existing building, including upgrading the major systems, which extends the building’s usable capacity or useful life shall be capitalized. This includes the major replacement, or upgrading of building systems, components, or fixed equipment that is necessitated by facility obsolescence, change in use, code requirements, physical plant wear-out, and/or related interior space modifications and aesthetic improvements. Examples include, but are not limited to: demolition of the interior of a building or portion thereof including the removal and subsequent replacement of electrical, plumbing, ventilating and air conditioning systems, fixed equipment, floor coverings and interior walls and partitions (whether fixed or moveable). If an individual project cost less than $100,000, the expense is to be charged to repair and maintenance operations object code, rather than capital. Cosmetic remodeling, such as simple replacement of floor and wall coverings as part of a periodic redecorating, is a maintenance and repair activity. These cost shall not be capitalized, except when it is incidental to a remodeling, betterment and renovation project. MAJOR MAINTENANCE AND REPAIRS: The periodic need to repair and rework building and infrastructure systems or components to maintain the original condition of the asset. The expense should be classified as a repair and maintenance expenditure and charged to operations object code.