- Land, buildings and infrastructure comprise the following categories:
- Land at cost – account 3300
- Land at valuation – account 3302
- Buildings at cost – account 3200
- Buildings at valuation – account 3201
- Dwellings at cost – account 3250
- Dwellings at valuation – account 3251
- Infrastructure at cost – account 3202
- Infrastructure at valuation – account 3203
- Property is broadly defined by the University as:
- site works and services (infrastructure);
- computer networks
- capital improvements, to previously capitalised assets such as:
- air conditioning systems
- fire control systems
- The definition of property expressly excludes repairs and maintenance.
- Some refurbishment projects will constitute repairs and maintenance.
- The Property Register: This is the official, independent record of the University in which details of property items, including costs of construction and/or acquisition, are recorded. Items are recorded in accordance with appropriate non-current asset account codes and descriptions shown in the latest Chart of Accounts.
- The acquisition of capital assets by ANU is supported by the raising and issuing of official orders or contract documents (in accordance with the Financial Authorisations) which specify fully the item(s) to be acquired or the construction work to be undertaken.
- With respect to capital assets under construction, the acquisition will often involve the need to make progress payments, within the terms and conditions of payment detailed in the order or contract document. Progress payments in many cases will be actioned only following the certification by an architect, consulting engineer or other competent professional authority.
- Under normal circumstances, Facilities and Services, in conjunction with F&BS, will be responsible for managing capital projects with respect to land, buildings and infrastructure.
- The following expenditures are considered to be of a capital nature and must be recorded in the University's books of account:
- All new buildings together with associated site works and services;
- Services associated with access to the University site (e.g. roads and footpaths), other than routine repairs and maintenance;
- Services associated with the provision of electricity, drainage and stormwater control, sewerage and fire prevention, other than routine repairs;
- Services associated with electronic voice and/or data transmissions and computer networks;
- Rehabilitation and renovation of assets previously capitalised when the expenditure prolongs the useful life of the asset or enhances the benefit from the asset, provided that expenditure is not of a routine or recurring nature;
- When assets are partially replaced under a rehabilitation or renovation program, the value of the asset previously capitalised shall be reduced by an amount equivalent to the estimated original cost of the replaced part less depreciation provided if any;
- Capital improvements to previously capitalised assets such as air conditioning or fire control.
- Notwithstanding the points above, individual expenditures which cost $20,000 or less, or individual costs which constitute a total project cost of $20,000 or less, shall not be recorded as assets of ANU, unless a separate determination has been made in conjunction with discussion with the manager, Financial Services. All projects involving repairs and maintenance and refurbishment must be considered in respect of the correct capitalisation approach and it is incumbent upon the manager, Facilities and Services, to undertake this consideration and to engage the manager, Financial Services, if required.
- All expenditures undertaken by manager, Facilities and Services, having a total project cost greater than $20,000 shall be referred to the Senior Accountant or nominee of the manager, Financial Services, for assessment concerning the recording of assets in the University's books of account, and whether or not the particular project is capital or expense in nature.
- Buildings, major alterations, rehabilitation, renovation:
It is a requirement that all major alterations to buildings or the rehabilitation or renovation of buildings be referred to Facilities and Services, in the first instance. When Facilities and Services does not undertake the work on behalf of schools, sections or ANU business units, Facilities and Services shall advise the manager, Financial Services or nominee of the manager, Financial Services, who shall assess the proposed work and may direct the recording of the asset in the University's books of account.
- Costs incurred relating to a non-current assets subsequent to it having been first put into use or held ready for use must be added to the carrying amount of the asset when and only when it is probable that future economic benefits, in excess of the originally assessed standard of performance of the asset, will flow to the entity in future reporting periods. All other such costs must be recognised as an expense in the reporting period in which they are incurred.
- Capitalisation guidelines,application:
The foregoing guidelines shall be applied to all works undertaken by Facilities and Services and schools/sections. The source of funding is not a criterion for the recording of assets in the University's books of account.
- Capital expenditure, commitments:
ANU is subject to the following Commonwealth Department of Finance Guidelines. Where commitments are not recognised as liabilities in the Statement of Assets and Liabilities, the Financial Statements of the University shall disclose the commitments for capital expenditure classified according to whether they are payable:
- not later than one year after the end of the accounting period;
- later than one year and not later than two years after the end of the accounting period;
- later than two years and not later than five years after the end of the accounting period; and
- later than five years after the end of the accounting period.
- Disposal, transfer, demolition (full or part) of ANU Property:
Any movement in relation to the ownership of property, arising out of disposal, transfer, partial or full demolition or any other occurrence must be notified promptly in full detail to F&BS, so that the financial impact of the occurrence can be properly brought to book in the University's financial records.
- Depreciation of buildings:
ANU is required to conform with the Australian Accounting Standards, specifically AASB 116 – Property, Plant and Equipment.
- The Accountant, SMR, Financial Services (Phone x58724) is primarily responsible for the management of depreciation procedures. Depreciation on buildings is included in the ANU Annual Financial Statements.
- 'Useful life' is defined by AASB116 to mean:
- the period of time over which an asset is expected to be available for use by an entity; or
- the number of production or similar units expected to be obtained from the asset by an entity.
- ANU policy is to depreciate non-residential and residential buildings according to their 'useful life' as required in the standard.
- Funds for the acquisition/construction of property assets are derived principally from the University's Capital Management Plan and the Building Reserve, and from designated budget funds of Facilities and Services. Specific projects may also be supported by approved contributions from the budgets of schools and sections.
- Accounting transactions relating to the construction of buildings and the provision of other capital works are processed automatically through the Maximo system, or by the normal accounts payable processes. Projects may involve progress payments to external parties on the completion of certain stages of work.
- Accounting Entries:
All expenditures having a total project cost greater than $100,000 are assessed for inclusion in the University's Property Register. Where project expenditure is to be capitalised, Cash ledger entries are made to the nominated assets Work-in-Progress account. After completion of work and closure of a job in the job cost ledger, the accounting treatment is essentially:
- DR Property Assets
- CR Assets WIP (3198)
- Property Registers:
Full accounting details of the University's capitalised property assets are recorded in a buildings register and a land schedule maintained by F&BS. The physical location of properties is indicated by a system of descriptor ledger codes.
- Property Register:
In addition, F&BS are working with Facilities & Services to redevelop one extensive and central property register, which details accounting information and physical information with respect to the property details. Costs incurred relating to a non-current asset subsequent to it having been first put into use or held ready for use must be added to the carrying amount of the asset when and only when it is probable that future economic benefits, in excess of the originally assessed standard of performance of the asset, will flow to the entity in future reporting periods. All other such costs must be recognised as an expense in the reporting period in which they are incurred.