New Mexico Administrative Code › Title 2 - PUBLIC FINANCE › Chapter 20 - ACCOUNTING BY GOVERNMENTAL ENTITIES › Part 1 - ACCOUNTING AND CONTROL OF FIXED ASSETS OF STATE GOVERNMENT, ACCOUNTING FOR ACQUISITIONS AND ESTABLISHING CONTROLS › Section 2.20.1.9 - CLASSIFICATION OF FIXED ASSETS

Current through Register Vol. 35, No. 13, July 16, 2024
A. The
				type of service that the asset was purchased for must be used to classify fixed
				assets. The object code under which it was purchased is usually a reliable
				indicator of the service for which it was purchased.
B. Object codes from the category for capital
				outlay may be used. Purchases from other categories may also be capitalized if
				appropriate. For example, certain types of repairs or maintenance may increase
				the useful life of the asset. These costs should be added to the cost of the
				asset.
C. The recommended
				classifications and definitions are:
(1)
"Land"
: Only real property is included in this category. Costs to
				be included that are not specifically stated in Subsection B of Section
				2.20.1.10
				NMAC include fees for appraisals, title searches, attorney's fees, demolition
				of structures (less any salvage) as part of site preparation, and agent's
				commissions.
(2)
"Land
				Improvements"
: Improvements subsequent to the acquisition of land are in
				this category. Such assets have a limited economic life. Examples are roadways,
				landscaping, utility infrastructure, and fencing. This category may also be
				used to record leasehold improvements. Leasehold improvements should be
				capitalized to recognize the allocation of the cost of the improvements for the
				duration of their useful lives.
(3)
"Buildings and Structures"
: This category shall be used for all
				buildings and structures that are permanently fixed to land.
(4)
"Furniture and Fixtures"
:
				These are assets that are not permanently fixed to land, but are the contents
				of a building.
(5)
"Information Technology Equipment"
(including software): This
				category of equipment includes computers and peripherals, and all equipment
				related to electronic communications.
(6)
"Equipment and Machinery"
:
				Equipment that is related to industrial production, construction, land or
				grounds maintenance, food service, public safety should be recorded in this
				category.
(7)
"Farm
				Equipment"
: All equipment related to agricultural or ranch production
				should be recorded in this category.
(8)
"Livestock and Poultry"
:
				This category is only used for farm or ranch animals that are not purchased for
				immediate consumption or production of food.
(9)
"Library and Museum
				Acquisitions"
: Assets in this category only include holdings of
				libraries or museum collections. A publication that is available in a library
				but that is acquired by an agency for its private use would be appropriately
				categorized as furniture and fixtures. Similarly, a farm museum would use this
				classification for tractors and ploughs, even if they are used for their
				intended purpose.
(10)
"Motor
				Vehicles and Aircraft"
: This category is for all such vehicles that the
				agency owns. Vehicles and aircraft acquired under the terms of an operating
				lease should not be recorded as fixed assets.