601.0 Fixed Asset Library Accounting

The following policy provides information for the consistent accounting of general and special library collections.

POLICY PROVISIONS: Library collections are divided into depreciable "General" collections and non-depreciable "Special" collections.

• All library collections must be recorded in the Banner Fixed Assets subsidiary system and be capitalized in the General Ledger.
• Accounting for annual library additions and deductions (withdrawals) occurs at the end of the fiscal year as part of the year-end closing procedures.
• Additions are comprised of purchases and donations. Purchases are valued at cost at time of acquisition. Donations are valued at fair market value (FMV) at time of donation. The FMV of donated additions must also be recognized as revenue in the year of donation.
• Deductions are valued at historical cost of items withdrawn from the collections. The historical cost of withdrawals and associated calculated accumulated depreciation are used to reduce the total cost and accumulated depreciation values of associated library holding records at fiscal year end.
• Library general collections are depreciated using a ten year useful life based on year of acquisition. Depreciation is calculated under the straight-line method using a zero salvage value. The depreciation start date is January 1st of the fiscal year in which acquired thus achieving a half year first year option. Depreciation is recorded monthly subsequent to the initial half year first year option processed at fiscal year end.

NOTE: If the historical cost or FMV at time of donation of library collection holdings is unavailable, a recognized appraisal should be obtained. (Though recognized appraisals are preferred, estimated FMV is acceptable if cost of obtaining recognized appraisals is prohibitive. Method of estimating FMV should be documented and maintained at the institution.)

For more information on general and special library collections, please see the procedures manual.