(A) This fixed asset policy is being issued retroactively, effective January 1, 2014. The new policy will be referred to as the capital asset policy. This policy is being issued to document the minimum value of capital assets to be reported on the town's financial reports and to include infrastructure assets. This issuance of a policy document is related to the implementation of a new reporting model, Governmental Accounting Standards Board Statement 34 (“GASB 34”). Statement 34 will require the town to depreciate capital assets. The capital asset threshold will be $2,000. An asset with a value under $2,000 will be expensed in the year of purchase. The infrastructure portion of this policy is also effective January 1, 2014.
(B) Town utilities will follow this same definition of capital assets, except any item with a unit cost of $2,000 or more shall be capitalized. Assets that are not capitalized (items < $2,000) shall be expensed in the year of acquisition. Town utilities will also follow the capitalization guidelines of the Indiana State Board of Accounts.
(C) The town is, by this subchapter, establishing a capital asset policy in order to provide a higher degree of control over its considerable investment in capital assets, and to be able to demonstrate accountability to its various constituencies: citizens, rate-payers, oversight bodies and regulators. All public information pertaining to capital assets will be made available in the Comprehensive Annual Financial Report (CAFR).
(D) The purpose of establishing a capital policy is fivefold:
(1) To safeguard the investments of the taxpayers and ratepayers of Darlington;
(2) To fix responsibility for the custody of municipal equipment;
(3) To provide a basis for formulating capital asset acquisition, maintenance and retirement polices;
(4) To provide data for financial reporting; and
(5) To demonstrate appropriate stewardship and responsibility for public assets.
(E) This policy will serve only to classify capital assets, including fixed ones and infrastructure, for accuracy in financial reporting through the Indiana State Board of Accounts. It does not include data processing, programming requirements, or computer operations procedures.
(Ord. 3-19-2014, passed 3-19-2014)