ENTRY NO. 37 – ACQUISITION OF CAPITAL ASSETS - 10537

(New: 12/2021)

(New and renumbered from 8671, 8672, and 10520)

ACQUISITION – PURCHASE

 

Purpose: To record the acquisition of capital assets by means of purchase, lease/installment, or other means of purchase.

References: SAM sections 8610.1-8610.8, 8615-8615.4, 8630-8637, and 8366.

General Ledger – Modified Accrual Basis

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	5xxxxxx	9000	Appropriation Expenditures	a
Credit	1104000	1140	Cash in State Treasury	a

Subsidiary Capital Assets Group of Accounts Ledger

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	16xxxxx	2xxx	Capital Assets	b
Credit	3200000	5200	Investment in Capital Assets	b

Note:

1. Record the purchase of assets on a modified accrual basis of accounting within the fund.  Agencies/departments using FI$Cal will record the purchase in the Modified Accrual Ledger.
2. Record capital assets acquired by those funds that use the modified accrual basis of accounting in the capital assets group of accounts. Agencies/departments using FI$Cal will record capital asset additions in the Departmental Adjustment Ledger

 

In the case of a trade-in of a capital asset, record any proceeds from the sale as miscellaneous revenue. An exception to this rule occurs when the receipts are used to replace the old asset with another asset. In this case, the receipts are abated to the appropriations from which the replacement items are budgeted. See SAM 8366.

 

ACQUISITION – TRANSFER IN

 

Purpose: To record the acquisition of capital assets transferred from other state agencies of funds using the modified accrual basis of accounting.

 

General Ledger – Modified Accrual Basis

Debit/ Credit	Account	Legacy Account	Account Description	Note
			No Entry	a

Subsidiary Capital Assets Group of Accounts Ledger

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	16xxxxx	2xxx	Capital Assets	b
Credit	3200000	5200	Investment in Capital Assets	b

Note:

1. No entry is recorded in the general ledger if no cash is exchanged.
2. Record capital assets acquired by those funds that use the modified accrual basis of accounting in the capital assets group of accounts. Agencies/departments using FI$Cal will record capital asset additions in the Departmental Adjustment Ledger.

 

Record the transferred-in capital asset as a beginning balance adjustment on Report 18 and detail the transfer-in on the Differential Report. See SAM section 7977.

 

ACQUISITION – INTERNALLY GENERATED INTANGIBLE ASSETS

 

Purpose: To record the acquisition of internally generated intangible assets of funds using the modified accrual basis of accounting.

 

General Ledger – Modified Accrual Basis

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	5xxxxxx	9000	Appropriation Expenditures	a
Credit	1104000	1140	Cash in State Treasury	a

Subsidiary Capital Assets Group of Accounts Ledger

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	1629000	2430	Internally Generated Intangible Assets in Progress	b
Credit	3200000	5200	Investment in Capital Assets	b
Debit	162xxxx	24xx	Intangible Assets	c
Credit	1629000	2430	Internally Generated Intangible Assets in Progress	c

Note:

1. Record capital development costs on a modified accrual basis of accounting within the fund. Agencies/departments using FI$Cal will record the purchase in the Modified Accrual Ledger.
2. Record capital development costs in progress by those funds that use the modified accrual basis of accounting in the capital assets group of accounts. Agencies/departments using FI$Cal will record capital asset additions in the Departmental Adjustment Ledger.
3. Reclassify the in-progress account to the major capital asset account when the intangible asset is substantially ready to be placed into service in the capital assets group of accounts. Agencies/departments using FI$Cal will reclassify the in-progress account in the Departmental Adjustment Ledger.

 

ACQUISITION – INTERNALLY CONSTRUCTED TANGIBLE ASSETS

 

Purpose: To record the acquisition of internally constructed tangible assets of funds using the modified accrual basis of accounting.

 

General Ledger – Modified Accrual Basis

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	5xxxxxx	9000	Appropriation Expenditures	a
Credit	1104000	1140	Cash in State Treasury	a

Subsidiary Capital Assets Group of Accounts Ledger

Debit/ Credit	Account	Legacy Account	Account Description	Note
Debit	1608000	2350	Construction Work in Progress	b
Credit	3200000	5200	Investment in Capital Assets	b
Debit	160xxxx	23xx	Tangible Assets	c
Credit	1608000	2350	Construction Work in Progress	c

Note:

1. Record construction costs on a modified accrual basis of accounting in the fund. Agencies/departments using FI$Cal will record construction costs in the Modified Accrual Ledger.
2. Record construction work in progress for those funds that use the modified accrual basis of accounting in the capital assets group of accounts.
3. Reclassify the in-progress account to the major capital asset account when the tangible asset is substantially ready to be placed into service within the capital assets group of accounts. Agencies/departments using FI$Cal will reclassify the in-progress account in the Departmental Adjustment Ledger.