This policy establishes criteria for reporting capital assets on the financial statements in conformity with generally accepted accounting principles.
Mayor and City Council departments
Effective: January 1, 2001
Last revised: January 1, 2005
To establish criteria for reporting capital assets on the financial statements in conformity with generally accepted accounting principles.
The capitalization threshold for all capital assets is no less than $5,000.
Due to the nature of some infrastructure projects, the following additional thresholds were defined:
This policy is retroactive to January 1, 2001.
Cost normally includes all expenditures that may be necessary to put an asset in condition for use in its intended location.
Estimated useful lives for assets are:
| Infrastructure | 15 to 100 years |
|---|---|
| Structures and Improvements | 25 to 50 years |
| Equipment | 3 to 15 years |
| Public Improvements | 20 to 40 years |
Catalog codes within the City’s electronic capital asset system have further defined estimated useful lives by type of asset.
To qualify as betterment in the capital assets inventory, the cost must be at least $5,000, AND the addition/improvement must meet at least one of the following criteria:
Expenses to maintain equipment are not capitalized. Instead, such items are recorded directly as expenses of the accounting period. See capital asset procedure for further clarification of types of expenditures to be expensed.
All capital assets will be examined with respect to condition, efficiency of use, and technological obsolescence during each year-end physical inventory process. Items that are determined to be obsolete, excess, or not being used efficiently will be entered, reported and disposed of in accordance with the capital asset disposition procedures approved by the City Council (October 16, 1998, Ordinance 98-Or-117).
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Physical AddressPublic Service Center250 S. Fourth St., Room 401Minneapolis, MN 55415 Mailing AddressCity Hall350 S. Fifth St., Room 325MMinneapolis, MN 55415