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Municipal Technical Advisory Service (MTAS)

Sample Resolution to Set Threshold for Capitalization

Reference Number: MTAS-651
Reviewed Date: 12/13/2022

SAMPLE RESOLUTION TO SET THRESHOLD FOR CAPITALIZATION

WHEREAS this resolution establishes a threshold that dictates when expenditures may be capitalized in accordance with generally accepted accounting principles.

WHEREAS the City needs to establish a different threshold for each asset class in order to maintain effective managerial control.

THEREFORE the City resolves that these dollar levels set the thresholds that apply to the following asset classes:

 

Asset Category

Capitalization Threshold

Land

Any value

Buildings

$10,000

Improvements other than Buildings

$5,000

Equipment

$5,000

Infrastructure

$10,000

 

This resolution will take effect immediately upon passage.

 

First Reading: ___________________

 

 

_______________________________

Mayor

 

 

_______________________________

City Recorder