Reporting Requirements for Annual Financial Reports of State Agencies and Universities

Capital Assets

Sale, Disposal or Interagency transfer of Capital Assets
Recording Sale of Capital Assets

Run the SPA CAAB 105 report to show the amount of disposals for the agency. This report contains disposals of property to parties external to the state. It includes all “hard” disposal methods, other than interagency transfers, completed CIP and assets added in error. This report is sorted by:

• GAAP fund group
• Depreciable code
• AFR category
• GAAP fund type
• GAAP fund
• AFR fund
• SPA agency fund
• Property number
• Component number
• Depreciable entity FY

Subtotals are at the GAAP fund group, depreciable code and AFR category levels.

The amount for the sale of capital assets must match the amount in sale of capital assets reported in governmental fund types. When the entry is made, the balance between the governmental fund types and fund type 11 must net to zero.

Texas Facilities Commission (TFC) is required to report the full amounts of the sale proceeds to SPA. To account for the net proceeds in USAS, see Proceeds from the Sale of Surplus Property (FPP A.032). The difference is addressed in fund type 11, Basis Conversion.

Verify that capital outlay activity in governmental funds and basis conversion funds net to zero at the GAAP source/object level using the DR206 — Review Govt-Wide Basis Conversion report located in the FMQuery–SIRS AFR Desk Review menu.

The deletions column in Note 2 must match the net of proceeds from the sale of capital assets TFC fee and any gain or loss on the sale of capital assets.

Proprietary and Fiduciary Funds

Recording Capital Asset Balances

Proprietary and fiduciary funds (pension trust and private-purpose trust) report capital assets using full accrual accounting.

Business-Type Activities (Fund Type 05) and
Component Units (Fund Type 15)

Agencies Exempted From SPA and/or the General Provisions for Surplus and Salvage Property

• Use T-code 631 if there is a gain on the sale of assets.
• Use T-code 631R if there is a loss on the sale of assets.
• The GL account number used corresponds to the asset (and related depreciation) that is sold.
• COBJs that can be used for these entries:
  • 3349 Land Sales
  • 3750 Sale of Furniture and Equipment
  • 3751 Sale of Buildings
  • 3834 Gain/Loss on Sale of Capital Assets
  • 3839 Sale of Vehicles, Boats and Aircraft
  • 3841 Sale of Other Capital Assets

Accounting effect of above entries:

Governmental Funds

Modified to Full Accrual Adjustments for Capital Assets

Use the capital asset basis conversion adjustment (fund type 11) to convert governmental fund types from modified accrual to full accrual. For templates that can assist with the preparation of the capital asset adjustment (fund type 11) basis conversion entries, see Working Papers.

In governmental funds, sale of capital assets is a separate line item reported under “other financing sources (uses)” in the statement of revenues, expenditures and changes in fund balances. When the sale of capital assets is recorded as “revenues” (using T-code 179 or 195), the USAS entry must be reversed and recorded to “other financing sources (uses).”

• Corrections before Aug. 31, 20CY, use T-codes 179R/195R and 191
• Corrections after Aug. 31, 20CY, use T-codes 630 and 657

Since the proceeds from the sale of a capital asset are typically appropriated, record the entries to adjust budget with T-codes 006 and 009 when your agency receives the money.

Use the following COBJs to record sales of capital assets:

• 3349 Land Sales*
• 3750 Sale of Furniture and Equipment*
• 3751 Sale of Buildings*
• 3834 Gain/Loss on Capital Assets*
• 3839 Sale of Vehicles, Boats and Aircraft*
• 3841 Sale of Other Capital Assets*

*These COBJs only apply to a sale to an outside party and not to another state agency. For sales to another state agency, see Recording Interagency Transfers of Capital Assets.

Corrections Before Aug. 31, 20CY

Accounting effect of above entries:

Corrections After Aug. 31, 20CY

Accounting effect of above entries:

WARNING: System clearing must not have a balance after all transactions are entered.

Governmental Activities – Basis Conversion (Fund Type 11)

Agencies Exempted from SPA and/or the General Provisions for Surplus and Salvage Property

• Use T-code 516R if there is a gain on the sale of assets.
• Use T-code 516 if there is a loss on the sale of assets.
• The GL account number used corresponds to the asset (and related depreciation) that is sold.
• Use the following COBJs to record sales of capital assets:
  • 3349 Land Sales*
  • 3750 Sale of Furniture and Equipment*
  • 3751 Sale of Buildings*
  • 3834 Gain/Loss on Sale of Capital Assets*
  • 3839 Sale of Vehicles, Boats and Aircraft*
  • 3841 Sale of Other Capital Assets*

*These COBJs only apply to a sale to an outside party and not to another state agency. For sales to another state agency, see Recording Interagency Transfers of Capital Assets.

Accounting effect of above entries:

Recording Sale of Surplus Capital Assets

Business-Type Activities (Fund Type 05)

Accounting effect of above entries:

Governmental Activities – Basis Conversion (Fund Type 11)

TFC is required to report the full amounts of the sale proceeds to SPA. To account for the net proceeds in USAS, see Proceeds from the Sale of Surplus Property (FPP A.032). The difference is addressed in fund type 11, basis conversion.

Use COBJ 7973 to record the 12% TFC fee.

Use the Working Papers templates to assist with recording sale of surplus for capital assets (fund type 11).

Accounting effect of above entries: