GASB (Governmental Accounting Standards Board) 34 requires that districts issue district-wide financial statements using the economic resources measurement focus and accrual basis of accounting. This requirement means that certain amounts reported in the fund financial statements will need to be restated for the district-wide statements. In essence, the cost associated with the acquisition of capital assets will be replaced by the cost to use up the asset. The cost of usage, called depreciation, is reported in the current fiscal period in district-wide statements.
The Government Finance Officers Association (GFOA) suggests a capitalization threshold of an amount that ensures that at least 80 percent of the value of assets are reported, but the threshold should not be greater than $5,000. The Association of School Business Officials International (ASBO) also recommends that school districts establish a capitalization threshold that ensures that at least 80 percent of the value of assets are reported, but the threshold should not be greater than $5,000. The Association of School Business Officials International (ASBO) also recommends that school districts establish a capitalization threshold that ensures that at least 80 percent of the value of assets are reported without exceeding $5,000.
The capitalization threshold will be set at a level to capture 80 percent of the value of assets and periodically reviewed to ensure this percentage is maintained. Beginning with the 2003-04 school year the capitalization threshold will be established at $2,500.
The district will also keep an inventory of other fixed assets, which fall below the $2,500 capitalization threshold, for insurance purposes. Beginning with the 2003-04 school year, the fixed asset threshold for insurance purposes will be established at $500.
Approved: 7-12-04
Reviewed: 12-11-23
Revised:
