Policy
Capital assets should not be revalued when transferred between funds and/or component units of the State’s financial reporting entity. In these circumstances, the transferee should recognize the capital assets at the transferor’s carrying value. These intra-entity transfers include donations or purchases/sales of capital assets between any combination of the funds and/or component units of the State’s financial reporting entity including State agencies, universities, community colleges, and all other component units of the State.
Procedures
N/A
Accounting Guidance
Example – Component Unit A donated a building with an original cost of $400,000 and accumulated depreciation of $150,000 to Component Unit B. The building had an acquisition value as of the date of donation of $1.2 million.
Component Unit B would make the following accounting entry:
| Caption | Debit | Credit | |
| Building | $400,000 | ||
| Accumulated Depreciation | $150,000 | ||
| Capital Gift Revenue | $250,000 |
Component Unit A would also recognize a corresponding expense of $250,000.
Related Documents (Memos/Forms)
N/A
Revision History
- 6/30/2017 - Minor edits
- 1/17/2025 - Formatted for new ncosc.gov website