Disposal of Fixed Assets

When a department disposes of an existing asset that is recorded on their Departmental Equipment Listing they will need to update the Fixed Asset Accountant as explained in the Managing Assets – Equipment process.

Before disposal, there are a few other considerations to be made by the department.

For all disposals, the department should try and get a fair market value for the item and would usually be expected to get two to three independent valuations. If selling the item to a member of staff, it should be purchased with cleared funds on the date of purchase; no credit terms, salary advances or credit cards are to be used for the purchase. All asset sales must be approved by the Head of Unit in writing and a copy kept for audit purposes.

If the item was originally funded with external contributions, the department will need to ensure that there were no conditions of funding that may affect or prohibit the resale of equipment purchased specifically with these funds. They may have to go back to the original contracts or call the sponsors for this detail of information.

If you are giving the item away either internally or externally for 'free', this will have to be approved by the Head of the Unit in writing and a copy kept for audit purposes. It is assumed that when this happens the residual value of the piece of equipment is rather low or it will be a difficult item to sell on.

The Head of Unit should take all this into consideration and determine if there is a possibility to bank monies for the item into the department funds and if so, it should be done.

If the item is being sold to an external purchaser, it needs to be considered whether it might be unethical or undesirable for the University to be linked with this purchaser.

The Head of Unit has the final authority on the sale, but any decisions, the sale, proceeds, valuations, or free transfer all need to be documented. These documents need to be kept for future reference and or auditing purposes.

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