Purchasing From Equipment Reserve Accounts

Note:

Only equipment purchases which meet the capitalization criteria may be made from the equipment replacement/reserve funds. Equipment purchases which do not meet this criteria will be charged to the current funds of the purchasing DeptID.

Purchasing

Purchases from the equipment replacement/reserve funds began in FY96. Only capital equipment purchases are allowed from these funds (chartfield value 841101 capital equipment). This limits equipment purchases to 'capital equipment' which includes items $2,500 or more with a useful life more than 1 year.

For example, modular furniture for an office will in total cost $2,500 or more, but if individual components ordered are not $2,500 or more, this purchase should not be coded as capital equipment and therefore cannot be purchased from the capital equipment replacement/reserve funds. This distinction is important because it conforms with Federal definitions and requirements as well as NACUBO accounting standards for 'capital' equipment and matches a current University definition of capital equipment in the chart of accounts.

DeptID managers will control the funds in these chart strings and may make the actual purchases in the same way that they currently do. Because purchases will be aggregated by DeptIDs in the plant funds, the DeptID manager will be the default contact for Inventory Services. In order to assist Inventory Services to better locate equipment purchased through these funds and save managers extra work, DeptIDs are asked to specify the location of the equipment user and a contact person on the purchase voucher (this is the form used to determine capital equipment purchases).