Equipment - All Fund Groups

Equipment must meet two specific criteria to qualify as a capital purchase. It must have (1) an acquisition value of at least $5,000 (referred to as Capitalization Threshold) and (2) a useful life expectancy ≥ one year. Other costs such as assembling the asset, installation, freight/shipping, and training should also be capitalized with equipment purchases over $5,000. It is critical that capitalized equipment is correctly recorded in the university asset database using the following object codes:

• 7000  Capital Equipment
• 7015  Computer Equipment

The following are not considered capital equipment regardless of cost or useful life:

• Repair or replacement parts (object code 4700 - Repair & Maintenance)
• Maintenance and Warranty agreements (object code 4776 - Service Maintenance Contracts)
• Software license agreements are not capitalized unless ownership is indicated within the license agreement and the acquisition cost ≥ $500K. (object code 4616 - Computer Software Purchases)

Please refer to Standard Operating Procedure CSOP 8.0 Capitalization of Movable Equipment for detailed guidelines relating to the capitalization of moveable equipment and object code assignment. Please direct questions to capasset@iu.edu.