Property Accounting

Property Accounting Responsibility

The Property Accounting department is responsible for the accounting control, records, operations, and reporting for all moveable capital equipment. The Plant, Auxiliary, and Agency Fund Accountant is responsible for the accounting control, records, operations, and reporting for fixed assets. The disposal of equipment acquired through the University by purchase, lease, donation, loan, etc. is controlled by the University. All disposals must have prior approval from Property Accounting and additional approvals may be needed depending on the funding source; for example equipment purchased on a grant requires the approval of Sponsored Program Services (SPS).

Property Accounting will record the following information in the Asset Module for moveable equipment and capitalized software:

• Description of the asset including manufacturer and model name/number, serial number, inventory number, responsible person/department, original value, depreciation information, dates of acquisition, capitalization and deactivation, Fund, Orders and Cost Center numbers.
• All records will also include transfers of ownership, location changes, inventory cycle data, disposals of assets via SAP, and inventory reconciliations
• All of Property Accounting Electronic Forms will be retained in SAP in tables for retention period.

The Plant, Auxiliary, and Agency Fund Accountant is responsible for the accounting control, records, operations, and reporting for all fixed assets.

Custodial Responsibility

The head of each department is responsible for all assets procured by, or in conjunction with, his/her department to which the University has made assignment. This responsibility includes protection against abuse, theft, movement, disposal, or unauthorized use. An inventory of capitalized moveable equipment is performed and maintained by Property Accounting with departmental cooperation. Accurate inventory records are necessary for insurance purposes, maximum equipment utilization, and planning for replacement through historical data.

Acquisitions – Equipment may be acquired by purchase, gift, loan, transfers between departments or campuses within the university or from another institution, or Government surplus program.

Advertising – Equipment for sale – A piece of equipment that is in good or fair condition must be advertised for sale or transfer within the University for 14 days on the Advertising website.

Cost – Cost is defined as the total cash amount paid for the equipment plus the trade-in value, if any, of equipment given in exchange. For simplicity purposes, trade-in value is assumed to be the book value (cost less accumulated depreciation) of equipment traded. Included in cost are all charges incurred in readying the equipment for its intended use (e.g., freight and installation charges). Discounts, if any, are excluded from cost. For donated items, cost is defined as the fair market value at the date of donation, plus costs incurred to ready the equipment for its intended use but not including shipping charges. Fabricated equipment includes the total of all supplies and expense (S&E) costs, including drawings, blueprints, component parts, materials, supplies consumed in fabrication, and installation.

Fabricated Equipment – Fabricated Equipment is a new piece of equipment built or assembled from individual parts, by a PI or other approved Purdue University personnel. It must be determined prior to the acquisition of parts or service that these charges will be related to a fabrication so correct approvals are completed. If the piece of fabrication equipment meets capitalization criteria, its total cost will be recorded as capital. (See additional information on fabricated equipment in the Process and Procedures section)

Gifts – A Gift is a contribution of goods or services given that can be used to advance the mission of Purdue University. Gifts having a value more than $10,000 are to be capitalized. These must include an itemized inventory list, an invoice or letter from the vendor/donor, or published information on the value of the item(s). For all other gifts that are valued at $500,000 or over and that are not considered capital gifts, a journal voucher is prepared to record their value. Gifts in kind must be held by the university more than 3 years to be eligible for disposal by sale or exchange. An Property Accounting Electronic Form must be completed by the department to complete this action and forwarded to Property Accounting.

Object Class – A six-digit number SAP uses to categorize the type of equipment.

Asset Object Classes
154110	Land
154120	Land Improvements
154130	Infrastructure
154140	Buildings
154150	Assets Under Construction
154510	Operating Software
154520	Administrative Software
154800	Moveable Equipment

Property Accounting Electronic Forms – Property Accounting Electronic Forms are used to notify Property Accounting of pertinent information for each piece of equipment; including but not limited to the transfer, disposal of, change in location/building/room number, and/or equipment reported lost or stolen, notify when capital has been taken off campus for University business, and changing the funding source for an asset.

Purchases – Purchases of equipment that completed through the Ariba system by way of requisition. This requisition follows an approval path before the actual purchase is made at which time Property Accounting can determine if the equipment is capital or not. Purchases through direct invoice are charged to GL 537200 and reviewed by Property Accounting.

Tagging of Equipment – A ‘Property of Purdue University’ identification tag/sticker will be placed on all tangible capital assets upon purchasing. Each tag has a specific number which ties to an asset number in SAP that contains all documentation of the equipment’s specific information. Government owned property will also receive an ‘Owned by US Government’ tag to show its specific ownership.

Trade in Value – Trade-in value is to be the book value (original cost less all accumulated depreciation) of equipment traded.

Requisition – Before equipment is purchased, a requisition is set up for the requested item(s) in Ariba. An Equipment Verification form is required for all lab equipment, purchased with Federal funds, costing more than $50,000. This form is to verify that this piece of equipment is not already owned by the University and/or is not available to be used by this project. The requisition is then routed for approvals. Property Accounting is always the last approver for requisitions with a total of $10,000 or greater. Once all approvals are received, the PO is sent out for purchasing. 

Receiving – Equipment is physically received in MMDC, who delivers it to the ordering department. The business office staff marks the items as received in the Ariba system. Every morning Property Accounting runs a ‘Received’ list from SAP which shows all the capital equipment that was received in the system the prior day. This lets the Inspectors know that the equipment is here and ready for tagging.

Tagging – Property Accounting Inspectors contacts the contact person/end user to set an appointment for physically tagging the equipment. At this time a ‘Property of Purdue University’ numbered tag is secured to the equipment. This is the inventory number for this item. If the item is Federally owned, a Property of US Government tag is also added to the equipment. Any needed identifying information is also obtained to update the asset record in SAP including but not limited to, serial number, manufacturer, location, or contact name. Certain items may not be tagged due to their nature. Examples include (but are not limited to): certain works of art, livestock, and library books. Property Accounting maintains a supply of tags without barcodes that departments may request for non-capital equipment. The tags are labeled “Property of Purdue University” and are available upon request. All Government owned equipment will also have a special tag showing ownership of the item. This is a simple white tag that states “Owned by US Government”. All State owned equipment will need to follow grant specifications and Business Staff will need to work with SPS on any special requirements for this equipment.

Inventory – The Property Accounting team will complete a physical inventory of the West Lafayette Campus (by Building), farms, agricultural centers and Statewide Technology sites every two years. Other campus site inventories are handled jointly between the campus and Property Accounting. The information for all assets coded for a particular location are loaded into a scanner. This scanner is then taken out by the Inspector to the location where each asset is located and the inventory tag is scanned. The first round of scanned is referred to as ‘First Pass’. For any assets that were not found during First Pass, the Inspectors contact the contact person to assist with the location of the equipment. This period is referred to as ‘Second Pass’. Once Second Pass has been completed, any assets that could not be found are reported on the Inventory Recon which is sent to the department for further explanations. 

Disposal – At the time that a department no longer needs a piece of equipment and/or it is no longer useable, the Universities disposal process is to be followed. If the department no longer needs the equipment however it is in good to fair condition, an ad is placed on the Billboard Advertising website for 14 days. This website is only for Purdue employees to purchase items for Purdue use. If purchased from the ad, the equipment asset is transferred to the new department; the asset record is updated with the new information and continues in the inventory cycle. If the equipment is not purchased or is no longer useable, the disposal process is continued. This process starts with a ‘Property Accounting Electronic Form -Sent to WL Warehouse’ to be completed and submitted (see QRCs for more details on how to fill out the form). Property Accounting verifies and approves the submitted form, the asset record is automatically updated in SAP, an email is automatically sent to notify Purdue Surplus & Warehouse the form is approved for pick up. After receiving the approved form, the Warehouse staff contacts the department to determine the equipment delivery/pickup method of the equipment to the warehouse in preparation for resale/recycle/disposal. When a piece of equipment is send to the Warehouse to be sold to the public, the transfer of any funds received from the sale is processed via Intramural by the Warehouse. Questions concerning the amount and/or transfer should be addressed to the Warehouse. The Warehouse logs when the equipment is sold, recycled or disposed. At the end of every month the log is sent to Property Accounting to dispose of assets, which dispose of assets, which writes off value.