In order to comply with generally accepted accounting principles (GAAP) required by the State Auditor's Office and to better maintain records of current inventory, the Montgomery County Governing Board of Education does establish the following policy.

The Governing Board shall maintain a fixed asset accounting system. The fixed asset system shall maintain sufficient information to permit the following:

As fixed asset manager, the Treasurer is responsible for the development and maintenance of the fixed asset accounting system. The Treasurer, in cooperation with the Superintendent, shall develop procedures to insure compliance with this policy. To insure control over entity property, the directors or his/her designees in each location shall be assigned fixed asset responsibilities and be designated to work with the Treasurer and Superintendent.

Fixed assets are defined as those tangible assets of the District with a useful life in excess on one (1) year and initial cost equal to or exceeding $5,000.00. The Superintendent and other administrators may identify "controlled" assets that, although they do not meet all fixed asset criteria, are to be recorded on the fixed asset system to maintain control. Like assets in the same room will be grouped together and will be included if the collective value meets the dollar threshold.

Fixed assets shall be classified as follows:

Fixed assets shall be recorded at historical or, if that amount is not determinable, at estimated historical cost. The method(s) to be used to estimate historical cost shall be established by Industrial Appraisal Company.

Donated fixed assets shall be valued at their (estimated) fair market value on the date received. Fixed assets shall be recorded at replacement cost for insurance purposes.

The purchase of fixed assets, the transfer of fixed assets between buildings or departments, and the disposal of fixed assets shall be initiated by the Superintendent or Director and required to notify the Treasurer of such. An asset to be disposed of by sale, which has a current value in excess of $7,000 shall be sold at auction. The Superintendent at his/her discretion may require may asset, regardless of value, to be sold at auction. An auction shall be held at the discretion of the Superintendent when sufficient assets have accumulated to warrant the cost. The Superintendent shall establish minimum acceptable prices for assets sold at auction.

Unless otherwise noted, the following information shall be maintained for all fixed assets: