The Governmental Accounting Standards Board (GASB) has issued Statement No. 51, Accounting and Reporting for Intangible Assets. The University must implement the requirements of the Statement beginning July 1, 2009.
The definition of Intangible Assets is: All assets whether obtained by purchase, donation, or other means, that lack physical substance, are non-financial in nature, and have an initial useful life of more than one year are required to be recorded by Financial Services in the fixed asset system. Intangible assets of the University should be capitalized over their useful life according to their capitalization thresholds. Assets costing below these thresholds should be expensed as incurred. If the life is indefinite or unlimited – as may be the case with licenses or permits – then do not amortize.
The following intangible assets are excluded from the provision of GASB Statement No. 51 and should not be capitalized:
- Assets that are acquired or created primarily for the purpose of directly obtaining income or profit, such as a copyright used primarily to generate royalty income
- Assets resulting from capital lease transactions reported by lessees
- Goodwill created through the combination of the University and another entity
The Intangible Assets Procedures Manual addresses the guidelines for properly accounting for these items.
It is the responsibility of the department to notify Financial Services upon receipt, disposition, or obsolescence of any intangible asset.
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