It is the policy of the Southwest Vermont Supervisory Union, Bennington School District, Inc., Mount Anthony Union School District, North Bennington Graded School District, Pownal School District, Shaftsbury School District, and Woodford School District to recognize the need to implement the required accounting and financial reporting standards promulgated by the Governmental Accounting Standards Board (GASB). GASB Statement 34 was issued to provide new and additional information to the diverse users of district financial statements. In addition to the information contained in previous financial reporting, GASB 34 will now provide information in a highly aggregated manner looking at the long-term financial health of the school district. This new information will require school districts to account for capital assets in a manner different than previously recorded. The intent is to provide an additional set of entity-wide financials statements more similar to the private sector.
The primary objectives of GASB 34 include:
- new entity-wide financial statements that reflect the overall financial position of the district
- long-term focus for school district activities
- narrative overview and analysis
- information on major funds
- expanded budgetary reporting>
It is important to note that the methods, calculations and procedures for determining the budgetary process of the school district will not be affected by the implementation of the new standards. The information contained in previous financial statements will largely be in the same format.
Governmental Accounting Standards Board Statement 34
DELEGATION OF AUTHORITY
The Board delegates to the Business Office, the responsibility to coordinate the compilation and preparation of all information necessary to implement this policy in accordance with district administrative procedures.
Capitalized Asset – a capitalized asset shall be any asset acquired by donation or purchase that has a useful life of longer than one year or extends the life of another capitalized asset or increases its value and meets a specific dollar threshold. At administrative discretion, capital assets purchased with long-term debt may be capitalized regardless of the specific dollar threshold for the type of class of asset acquired.
Value of Assets - all capitalized assets shall be recorded at historical cost at acquisition date or estimated cost if acquired prior to the date of the initial inventory. Any donated capital asset shall be recorded at the date of donation using fair market value of the item at that date.
Depreciation - depreciation shall be based on the straight-line method of depreciation over the estimated useful life of each depreciable asset or group of assets. Periodically, management shall evaluate the estimated useful life of each depreciable asset to determine if revision of such estimate is required.
Dollar Threshold - a dollar threshold for each asset shall be set at an appropriate level. Management should periodically review these levels with assistance from the independent auditor and make any modifications necessary.
: Capitalization Procedures