In order to be capitalized, equipment purchases with a cost of $10,000.00 or greater should be charged to one of the Workday Capital EquipmentSpend Categories.This also includes the cost of asystemwhich is defined as:
Items associated with the acquisition and installation of capital equipment, irrespective of cost, which are acquired for the purpose of assembling or constructing a finished product. These items are physically connected and are essential or enhancements to the capital equipment.
An example of a system would be a new piece of lab equipment with attachments A, B, and C. Individually A, B, and C are under the capitalization threshold, but necessary components to make the piece of lab equipment operate. They can be purchased separately but rely on each other to work. In order to be considered a system all items must be purchased within 30 days of the original associate purchase order.
Also Included in the value of an asset’s cost are, shipping and handling fees, freight, installation costs, site preparation costs, accessories, labor, software, or any other costs directly necessary to bring an asset into service and make it functional.
Certain costs are not allowed to be capitalized and should not be considered part of the acquisition cost of a capital asset. Excluded from the value of an asset’s cost are maintenance plans, warranties, software licenses, training costs, operating supplies and consumables and project personnel salaries.
Non-Capital Items
Departments should maintain their own equipment list to aid in the tracking of all equipment. Special attention should be given to non-capital items which can easily be converted to personal use or are marketable for resale. Examples of this type of equipment would include computers, audiovisual, video equipment, tools and digital cameras. It is important to maintain identifying information including serial numbers to aid with identification, in the event of the loss or theft of the equipment.
