Equipment Acquired Through an External Transfer to the University of Minnesota
An equipment item transferred to the University of Minnesota from another educational and/or research institution must have its value determined. A formal appraisal is used to determine the fair market value (FMV) of the transferred equipment item. The original cost and estimated useful life of the transferred equipment item are used to determine its estimated net book value (NBV). The transferred equipment must meet all of the following criteria to be classified as a capital equipment asset:
- have a FMV or an estimated NBV of $5,000 or greater
- the University must have title or ownership rights of the equipment
- the equipment must have a useful life of 1 year or greater
If no formal appraisal exists for the transferred equipment item, or if the equipment does not meet the above criteria, then it cannot be classified as a capital equipment asset.
To acquire the capital equipment asset through external transfer:
- The department receives from another educational and/or research institution an equipment item.
- The department completes form UM 1675: Capital Equipment Asset Transfer Acquisition from Another Institution Form.
- The department submits to Accounting Services a completed form UM 1675 and copies of any documentation provided by the originating institution, sponsor, and/or principal investigator. Such documentation should include a letter from the sponsor's contracting officer approving the transfer of the active sponsored award and the associated equipment item. Additional documentation should include a formal appraisal of the equipment item.
- Accounting Services receives and reviews the completed form UM 1675, and any additional documentation. If the completed form UM 1675 does not contain all of the required data elements or if additional documentation is deemed necessary, then Accounting Services does not process the completed form UM 1675 and returns it to the department with an explanation of the denial.
- Accounting Services determines whether the equipment item is a capital asset or non-capital equipment, based on the criteria above. If the equipment is classified as a capital equipment asset, then it is assigned a University ID number and is recorded in EFS Asset Management as a capital equipment asset. If the equipment is considered non-capital equipment, then it is managed according to the policies and procedures of the department's Resource Responsibility Center (RRC).
- Accounting Services travels to the department to verify the information on the signed form UM 1675 and to affix a bar-coded University capital equipment asset tag to the capital equipment asset.