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Purchases of personal property from non-proprietary funds involve initially charging the purchase, for budget tracking purposes, to a 401xx or 402xx operating ledger account code and capitalizing the asset in the investment in plant fund.
Purchases of real property typically involve multiple invoices and multiple payments. The payments are initially recorded throughout the year with real property 403xx, 404xx, 405xx, or 407xx account codes in fund types 11 - Budgeted Operations, 81 - Unexpended Plant Funds and 83 - Renewal and Replacement Funds. Periodically (at least annually), the real property account codes are reviewed to determine which of those expenditures should be capitalized as construction in progress, or completed assets in Banner Fixed Assets. For additional information, see D Construction, below.
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A written appraisal,
A qualified expert on the faculty or staff if he or she is considered to hold special knowledge or expertise related to the property being donated,
Documentation obtained from a qualified outside source such as "blue book" or a knowledgeable dealer, or
Identifying what it would cost the university if it were to purchase the gift outright from a vendor or an original bill of sale for new equipment.
Refer to the procedures manual and the policy below for detailed accounting instructions pertaining to donations of personal property and real property.
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Capital leases should be recorded in Banner Fixed Assets. The amount to be recorded upon signing the lease is the present value at the beginning of the lease term of the minimum lease payments during the lease term, or the fair value of the leased property, whichever is less. Executory costs (e.g., insurance and maintenance) are not included for purposes of calculating minimum lease payments. The university must maintain an amortization schedule for each capital lease. The periodic lease payments are divided between the lease obligation and interest as determined by the amortization schedule. For more information, please see the procedures manual.
RENTAL: Some fixed assets are not purchased, but rented on a month-to-month basis. Since rented fixed assets are only used but not owned by PSU, PSU accounting policy is to expense the rental payment in a 240xx account code and not to capitalize the fixed asset. Although rentals are not capitalized, they may be included in Banner Fixed Assets for insurance coverage purposes.
OPERATING LEASE: Operating leases are similar to rentals except that the rental agreement has a specific time period. PSU accounting policies for operating leases are the same as for rentals, except that at the end of each year for financial reporting purposes, PSU must prepare a listing of all operating leases and the expected future payments of those operating leases. Since operating leases are not recorded in Banner Fixed Assets, the institution needs to maintain separate records of operating leases. Although operating leases are not capitalized, they may be included in Banner Fixed Assets for insurance coverage purposes. See Accounting for Leases policy for additional information.
For more information pertaining to the acquisition of capital assets, please see the procedures manual.