The University is subject to accounting standards developed by the Governmental Accounting Standards Board. In June 2007 the board issued standard number 51, Accounting and Financial Reporting for Intangible Assets that is effective as of July 1, 2009. Failure to comply with the accounting standard could result in a unfavorable audit opinion by auditors. This would adversely impact the University's reputation with legislators, grantors, donors and creditors.
Click on a topic (right) and/or add a search term (below) to limit results.
Intangible Assets (GASB 51)
Intangible assets are capital assets that have the following characteristics:
Lack physical substance
They are not financial instruments such as: cash, investments and receivables
Initial useful life greater than 1 year
Examples: easements, water rights, patents, trademarks, computer software (not the transmission media, just the programming)
In discussions with the State Office of Financial Management and auditors it was determined that $1 million was the appropriate capitalization threshold for these assets. This balances the benefit of tracking the assets with the cost of tracking the assets. For example, to arrive at the cost of software generated by University personnel it would be necessary for employees to track the time spent in development of an approved project. Costs incurred prior to project approval and for program implementation would have to be expensed. Departments would be required to keep detailed records of project activity to support the asset balances that would be subject to audit.
For questions related to the recharge rate, please contact MAA - Recharge and Cost Center Accounting firstname.lastname@example.org.