Administrative Procedure 8.516 Administrative Procedure 8.516

  Property and Equipment Valuation (formerly Valuation of University Equipment)

Administrative Procedure Chapter 8, Business and Finance
Administrative Procedure AP 8.516, Property and Equipment Valuation
Effective Date:  May 2016
Prior Dates Amended:  July 1982, December 1996
Responsible Office:  Office of the Vice President for Budget and Finance/Chief Financial Officer
Governing Board and/or Executive Policy: EP 1.102, Authority to Manage and Control the Operations of the Campus
Review Date:  May 2019

To provide uniform guidelines and procedures for establishing the value of equipment and controlled property recorded in the University of Hawaiʻi (University) Kuali Financial System.

Refer to AP 8.509, Section II. for property and equipment related definitions.

A.  General

    1.    All equipment and controlled property shall have a recorded value for purposes of inventory replacement and reporting.

    2.    Asset representatives and fiscal administrators are responsible for ensuring that all applicable costs are included when establishing the property’s value.

    3.    The basis for the recorded valuation of equipment and controlled property is dependent on how an asset is acquired (i.e., purchased, transferred in, donated, etc.).

    4.    Cost is the accepted basis of valuation for recording the value of equipment and controlled property acquired by the University.

B.  Basis for Valuation

    1.    Valuation at Acquisition Cost

        a.    Cost incurred by the University to obtain an equipment or controlled property item and placing it into usable condition including taxes, freight, delivery, customs duty and installation.

        b.    Property valued at acquisition cost includes:

            (1)    Outright purchases from vendors of both new and used items

            (2)    Fabrication or construction of assets by the University

2.    Valuation at Established (Original Acquisition) Cost

    a.    Sponsor-owned property transferred to the University from a government agency or extramural sponsor is valued as its original acquisition cost.

    b.    Federal excess and surplus property (i.e., property from the DoD Defense Reutilization and Marketing Office) and other assets furnished by the Federal Government (i.e., in-place transfers) shall be valued at its original acquisition cost.

3.    Valuation at Fair Market Value

    a.    Fair market value (FMV) is the probable price that property would sell for to
an unrelated buyer that knows the relevant facts about the property and where neither buyer or seller is under any compulsion to buy or sell.

    b.    The value of donated equipment and controlled property processed through
the University of Hawaiʻi Foundation (UHF) is based on fair market value.  The fair market value of a donated item is determined by the donor/grantor or by independent appraisal.

    c.    The value of federal surplus items acquired from the State of Hawaiʻi, Surplus
Property Management Office, shall be valued at 23.3 percent of its original acquisition cost.  Refer to AP 8.521, Property and Equipment Acquisition.

    d.     Equipment transferred or donated to the University by another institution or
government agency shall be established at fair market value as determined by the principal investigator or individual receiving the equipment.

There is no administrative specific delegation of authority.

Property & Fund Management Office, 956-8735, or pfmo@hawaii.edu
Website: http://www.fmo.hawaii.edu/capital_assets/index.html

    A. Link to superseded Executive policies in old format https://www.hawaii.edu/policy/archives/ep/
    B. Link to Administrative Procedures in old format
https://www.hawaii.edu/policy/archives/apm/sysap.php

None

    Vice President for Budget and Finance/Chief Financial Officer