M E M O R A N D U M
FROM: |
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DATE: |
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SUBJECT: |
GASB 34—-Infrastructure
Reporting |
The Comptroller General’s
Office has decided that the State of South Carolina’s primary government
willthe majority of report only the Department of
Transportation’s roads and bridges (and roads and bridges, if any, of the State
Infrastructure Bank) as “infrastructure” in the State’s financial
statementsowned . All othere may be ther
State agencies that that own have assets
that might otherwise appear to be infrastructure assets should report those
assets as “depreciable land improvements” or “buildings and improvements”
if their cost exceeds the applicable capitalization limit of $100,000. Depreciable land improvements,
buildings, and building improvements currently on the capital assets ledger
that cost $100,000 or less must be removed upon implementation of GASB 34. This change in policy should be
reported retroactively as a change in principle (i.e., as adjustments to the
beginning balances of capital assets).
The following list is not all-inclusive but provides examples of assets that State agencies other than the Department of Transportation should report in the “depreciable land improvements” or the “buildings and improvements” categories of capital assets:
Access roads
Power lines/electrical systems
Drainage systems
Fiber optic cable networks
Water and sewer
systems Fencing
Lighting systems
Parking lots
Agencies should choose the “buildings and improvements”
category if the asset is associated with a particular building or group of
buildings andbut should
use the “depreciable land improvements” category if the asset would
continue to retain its usefulness without the presence of any existing
building.
Communication systems, including microwave towers, should
continue to be reported in the “buildings and improvements” or “equipment”
category. Specifically,
equipment that becomes a permanent fixture of a building and is not easily
separable from the building should be recorded in “buildings and
improvements”; otherwise, it should be reportcorded in “equipment.”
In order tTo calculate
depreciation on these assets, agencies need to assign
a useful life based on the schedule provided in the policy memo on capital
assets issued to agencies on February 13, 2001. If the specific
type of asset is not listed, please choose a useful life that does not exceed the maximum provided on the schedule of 60 years for land
improvements or 55 years for building improvements. Agencies should calculate
depreciation using the method described in the above-referenced memo.
Please contact Betsy Lawson by telephone at
(803) 734-2617 or by e‑mail at blawson@cg.state.sc.us if you have any questions regarding the
information contained in this memo. Thank
you.
BCH:bg
2001-04-28