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Reportin_q Capital Assets <br /> <br />Capital assets should be recorded and reported at their historical costs, which <br />include the vendor's invoice (plus the value of any trade-in or allowance, if <br />reflected on the invoice), plus sales tax, initial installation cost (excluding in-house <br />labor) modifications, attachments, accessories or apparatus necessary to make the <br />asset usable and render it into service. Historical costs also include ancillary <br />charges such as freight and transportation charges, site preparation costs, and <br />professional fees. <br /> <br />When the historical cost of a capital asset is not practicably determinable, the <br />estimated historical cost of the asset should be determined by appropriate <br />methods and recorded. Estimated historical cost should be so identified in the <br />record and the basis of determination established in the responsible entity's public <br />records. The basis of valuation for capital assets constructed by entity personnel <br />should be the costs of material, direct labor, and overhead costs identifiable to the <br />project. An entity that owns capital assets is responsible for correctly reporting <br />these assets at the date of acquisition. <br /> <br />Donated capital assets should be reported at fair value~ at the time of acquisition <br />plus ancillary charges, if any. Donations are defined as voluntary contributions of <br />resources to a governmental entity by a nongovernmental entity.2 <br /> <br />Depreciating Capital Assets <br /> <br />New to general governmental capital assets is the requirement to depreciate those <br />assets over their estimated useful lives. Depreciation is the process of allocating <br />the cost of an asset over the periods that asset is used for its intended purpose. <br /> <br />Capital assets should be depreciated over their estimated useful lives unless they <br />are: <br /> <br /> · Inexhaustible (i.e., land and land improvements, certain works of art and <br /> historical treasures), <br /> · Infrastructure assets reported using the modified approach, or <br /> · Construction work in progress <br /> <br />Fair value is the amount at which an asset could be exchanged in a current transaction between willing <br />parties. <br />A voluntary contribution of resources between governmental entities is not a donation. <br /> <br /> <br />