Policies & Procedures Manual - Elizabeth City State University

400.1.49Adopted: 06/14/05ELIZABETH CITY STATE UNIVERSITYFixed Assets- LandDefinitionLand is the real estate held by the State. Land can be purchased or otherwise acquired, i.e.inherited or donated. All land is entered on the university's Fixed Assets System, when the State(ECSU) takes ownership of the property and the $500/$5,000 threshold is met. Land valued from$500 - $4,999 is expensed or written off at the fiscal year end. Land costing $5,000 or more iscapitalized. Since land is considered not to have a limited useful life and its salvage value isunlikely to be less than its acquisition cost, land is not depreciated.Purchased LandPurchased land should be entered at its cost. The cost includes its purchase price and any othercharges necessary to purchase the land. The other charges include costs such as site preparationexpenditures, professional fees, and legal claims directly attributable to the land acquisition. Ifland and buildings are acquired as a single parcel, the value of the land should be determinedseparately from the building and recorded in the land account. If land and building are acquiredtogether with the intent to raze the building, the cost of razing the building should beinventoried/capitalized as part of the cost of the land if it meets the $500/$5,000 threshold. (Razemeans to level to the ground or demolish)Donated LandDonated land should be capitalized at the appraised market value at the time of donation.