UCAR PROPERTY MANUAL

Property Homepage Manual TOC 3--Guidance 4--Contacts 5--DPA Responsibilities
6--Meeting Notes 7--Responsible Person Duties 8--Sensitive Property 9--Capitalization Guidelines

Section 3-9: Depreciation

Assets titled with the federal goverment are not depreciated.

UCAR depreciates assets titled with UCAR monthly and posts that depreciation to the General Ledger (GL). Assets titled to non-UCAR entities may be depreciated, as directed by each entity, but such depreciation is calculated and reported manually. It is not recorded in the Fixed Asset Database (FADB) or posted to the UCAR GL.

UCAR-titled assets are depreciated according to the straight-line depreciation method. This means the total cost of the asset is divided by the number of years in its useful life and that amount is depreciated annually, posted in monthly increments. UCAR also uses the convention of posting six months of depreciation in the first fiscal year of an asset's useful life and six months of depreciation in the last fiscal year of its useful life. Therefore, depreciation of an asset with a 3-year (36-month) useful life will occur over four fiscal years, 4-year (48-month) useful life over five fiscal years, and so on. Following is an example of depreciation on a $5,000 computer over the course of its 4-year useful life.

Useful lives for assets purchased with bond funding are established by the UCAR Treasury Office.

Most UCAR depreciation costs are posted to a fund level account key and, therefore, do not impact the divisions. Depreciation costs related to bond-funded assets are posted to division (or department) account keys and the impacted divisions are notified by e-mail when depreciation is posted.

If your division expects to be impacted by depreciation costs, contact the UCAR Property Office and request that an appropriate e-mail address for your division be added to the depreciation e-mail distribution.

Questions regarding how UCAR manages depreciation, including depreciation calculations and GL postings, should be directed to the UCAR Property Administrator at ext. 8858.

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