(A) (1) The fixed asset policy has been revised and the new policy will be referred to as the capital asset policy. This revision was instituted to change the minimum dollar value of capital assets reported on financial reports from $500 to $5,000 and to include infrastructure assets. The revision is related to the implementation of the new reporting model, Governmental Standards Accounting Board Statement 34.
(2) The new reporting model will require the town to depreciate capital assets. Recommendations from several sources suggested a capital asset threshold of $5,000. An asset with a value under $5,000 will be expensed in the year of purchase.
(B) The town has established a comprehensive fixed assets management system 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.
(C) The purpose of establishing a formalized capital assets management system is fivefold:
(1) To safeguard the investments of the citizens of the town;
(2) To fix responsibility for the custody of equipment;
(3) To provide a basis for formulating capital asset acquisition, maintenance and retirement policies;
(4) To provide data for financial reporting; and
(5) To demonstrate appropriate stewardship responsibility for public assets.
(D) This portion of the policy and procedure manual, capital assets is limited to outlining the broad classifications of property, the definitions of assets, methods of creating asset data, acquisitions of transfers and retirements of town-owned property for which the town is fiscal agent. It does not include data processing, programming requirements or computer operations procedures.
(Res. 9, passed 7-20-2004)