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Home My WebLink About1992-05-27 92-285 ORDERItem/Subject; Order, Adopting Policy for Capitalization of Fixed Assets Responsible Department: Finance Commentary The attached policy i another i on-going efforts to develop a Financial Policy Manual. This policy outlines a general definition for what constitutes a fixed asset of the City. This policy will guide. our development of a Fixed Asset Inventory. Please note that the policy is, at this point, not complete. While it will allow us to begin the process, amore developed policy will be developed at a later date which includes greater detail until we have more fully developed a fixed asset inventory system. This will include such elements as the format, software, coordinating agency, departmental responsibilities, forms, etc. Nevertheless, this policy is a solid beginning. This policy has been reviewed and approved by the Finance Committee ____________________ Department Head _____________________________________________________________________ Manager's Comments; I concur with the Finance Director's recommendation and recommend approval. �^J�/j2%Ly//Y.O, fer .City Manager _______________________________ _______________________ Associated Information; Order, Policy --------------------------------------------------------------------- Budget Approval: N.R. Finance Director _____________________________________________________________________ Legal Approval: City Solicitor _____________________________________________________ Introduced For: Passage COVNCIL ACTION 9Z M Date: May 27, 1992 Item No. ________-- Item/Subject; Order, Adopting Policy for Capitalization of Fixed Assets Responsible Department: Finance Commentary The attached policy i another i on-going efforts to develop a Financial Policy Manual. This policy outlines a general definition for what constitutes a fixed asset of the City. This policy will guide. our development of a Fixed Asset Inventory. Please note that the policy is, at this point, not complete. While it will allow us to begin the process, amore developed policy will be developed at a later date which includes greater detail until we have more fully developed a fixed asset inventory system. This will include such elements as the format, software, coordinating agency, departmental responsibilities, forms, etc. Nevertheless, this policy is a solid beginning. This policy has been reviewed and approved by the Finance Committee ____________________ Department Head _____________________________________________________________________ Manager's Comments; I concur with the Finance Director's recommendation and recommend approval. �^J�/j2%Ly//Y.O, fer .City Manager _______________________________ _______________________ Associated Information; Order, Policy --------------------------------------------------------------------- Budget Approval: N.R. Finance Director _____________________________________________________________________ Legal Approval: City Solicitor _____________________________________________________ Introduced For: Passage 92 285 Assigned to Councilor Baldaccl May 27,1992 92-245 CITY OF BAN3OR (TITLE.,) Order, Adopting Policy for Capitalization of Fixed closets. By the City Council of the City of Bangor: ORDERED., THAT the attached Policy for Capitalization of Fixed Assets is hereby adopted. IN CITY COUNCIL _ 1 May 21; 1992 _ ^ 92-205 ease d yAdopting Policy for Capitalization of CI RK tFired assets �S� City of Bangor roltcy for Capitliaation of FI]ud Aeaet 92 285 Purpose: Ft is the PuxIase of this Policy to establish standards for xecomiisi the aayuiaitlOO met of outlay and capital items by the Cvwral Fwd aud the entetprfse funis. the intent Of this policy attenent is rot to establish a cmgmehaieive fired asset iwenmxy systemr but to establish the criteria for dstmm xd � what iteue wrnuld to xanrzaai xathin such a systen. _ Fi i Psaete; Fixed Asset are 1w -term to phlo assets obtiu>gl os courc lied es a resist of past tr v+:=, evaKs or cixcrostnces. Fixed assets include buildinO , eguip , iuq mea s other ttan M" ani land. - These are also ] as property, plant ard egutpo nt. outlay or Capital M dituaPs: ontlsY or capital expenditures ate t e expemitures which result in the ampuisitioo of or ahiition t the city's gesemi fixed assets. miniimmi Criteria: the minimm criteria are subject to chaff cr exmption lasaei upon the t}le nat of L asset, ti@ unit Yl1dCh aCgnixed the ss,e , aid the Pot nt:=i £or loss of the asset if Pat controlled. she Fists= Director will have the aut Pty, to lntexpret this Policy w*=A prudent judgarert zequims a mccnaideration of the policy's appiiration for s spncifi, Futchase. Asset P.irchased acPuiPre+t Buildir9 �iidi119 B�pxoveoent M] nsei tees t $500 -p A Less tan $3;000 Capitalized $500 - $1,000 tore $3,000to $10,000 life > 5 years _ adds m useful life of luilclu Capitaiimd $1,000 or mom All $10, 000 or more All Vehicles Padice f C®pi[ex e3uilmsit Ccneral Ffrnda � Acrnmt Gimp: 92 285 Fiared assets acgnited by tie Gaaral Fund will be amoiu2ed for within the General F� Asset Arnmffi Gmap (GFAAI;). The Faun• of all outlay items putchaaai daring the fiscal leanf plUS tle valve Of cmpleted capital projCots, will De reprn in the Ger . Deletima will also be repivred within tM OF . Daletims frou this account group will to Weds at tha te(xssted r. gr,iaitinn Cost. - The enterprise foals wi11 mlort their acquisitions and deletims £n the fi i asset acmunt within the este �,. fund. Fiord asset acgaisitim: will Lre expense3 ttuvu9h deprecietim. Depreciation will be mate based vpm the estimatal asset life of the itmi appropriate for the inhnst y the a2etpriae fond relaasents. Cmsiatarc with plat laectico, depreciatim will be mgvtsi by tha Straight-line metR l with me half of the first Feaz's cost being taken in the yeasof �itim arcl the me half of tie last year's Cost being takes: in the final year of the asset idle. Fedeml or State Gosh Fact res: > hgaeral fund depazto3¢ and am mise fi is tesponaible f� 1}^og t source of funds for ret or the Amared Falue if tie acyuisitfm la made with gsa}ut-in-aid funds. Altbeugh a otvproha fw asset hwento syatan will include a Prot ss for and identffyLg the scuroe of fuetla, uaRi1 ia4+1®usntal the mah Off those records will be the teepvaibility o£ tM d �.«.�..• m fiord. Arceuntinui a sSv� ar impiaentx:..., of this policy SGtemnt ata the taspvnsibiiity of the Fi>ams D gasiyent. Fach dTarppart i d anW appropriately and�forant of its oar and assure that porch mare LvtjgO i g and paohas Parses. sfiia lalicy Stateaaut is nm�ssanly. inn Wlets a w teeafn so until a - full fisrl asset inventory sys sd 5/D/92