The Office of the Vice President, Chief Financial Officer & Comptroller announces updates to 12.1.2, 12.1.9, 12.1.10, 12 Definitions, 12.1 Additional Resources – Importance of Accurate Equipment Coding, Capitalized Construction Projects, and Software Capitalization Approval Request to reflect the University of Illinois System’s increase in the thresholds for capitalization of specified capital assets and related projects.
Highlights of the update include:
- For purchases or projects starting on or after July 1, 2021, the University of Illinois System threshold for capitalization is increased.
- The threshold is increased from $100,000 to $250,000 for the following capital assets and related projects:
- Construction of new buildings
- Renovation or remodeling projects that significantly increase the usefulness, service life, efficiency, or footprint of an existing building
- Site improvements
- Software (internally developed or purchased) and other intangible assets (patents, copyrights, etc.)
- The increase in threshold reduces the amount of capital assets required to be recorded, which increases the efficiency and effectiveness of accounting for new and existing assets.
- The increase promotes consistency with the Universities’ and System’s capital delivery process in which most capital projects with budgets over $250K are required to be entered into the Project Management Software (FCPweb), which will reduce the corresponding risk of incompleteness of recording and reporting of capital assets.
- The $250K threshold is comparable to the capitalization thresholds used by other Big Ten Universities.
Contact
- For questions about the Business and Financial Policies and Procedures Manual, contact the CFO Business and Finance Policy Office at (312) 585-9071 or obfspolicies@uillinois.edu.
