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Reporting Requirements for Annual Financial Reports of State Agencies and Universities

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Reporting Requirements for Annual Financial Reports of State Agencies and Universities

Capital Assets

Sale, Disposal or Interagency Transfer of Capital Assets

When an asset is sold to a non-state agency, the resulting gain or loss must be recognized. A gain or loss occurs when the sale price does not equal the net book value of the asset.

When an asset is transferred between state agencies, a net increase or decrease is realized instead of a gain or loss.

When an asset is transferred, both agencies must agree and book the same value for the asset being transferred. The transfer in agency (including agencies not reporting to SPA or agencies using local depreciation or amortization calculation methods) must record the amount provided by the transfer out agency. Reconciling differences are adjusted during the CAFR preparation. For more information, see Recording Interagency Transfers of Capital Assets.