Fabricated Equipment Overview

Property & Equipment

Definition

´¡ÌýfabricationÌýis the process of transforming materials, non-consumable supplies, and hardware into a unique piece of equipment or scientific instrument tailored to specific research needs.

Capital Equipment Criteria

Fabrications are classified asÌýcapital equipmentÌýwhen:

  • TheÌýacquisition costÌýisÌý$5,000 or more.
  • The item has aÌýuseful lifeÌýof at leastÌýone year.

Financial Tracking

Each fabrication is assigned aÌýseparate SpeedTypeÌýin the University financial system. Request a speedtype set up through the Property Accounting Office. The speedtype allows for the segregation of costs related to:

  • Materials
  • Supplies
  • Freight
  • Construction
  • Installation
  • Training
  • Assembly labor
  • For guidance on identifying a fabrication subclass in project financials, refer to theÌýeRA step-by-step guide.

Completed and In-Service

Fabrications will be recorded asÌýin-serviceÌýupon completion in the property record. This should be done with time left in the project period to ensure it will benefit the award.

The department shouldÌýregularly review expendituresÌýrelated to the award and the fabrication SpeedType to ensure that all charges are appropriate and comply with university policies. Here are the costs that should be charged to the fabrication SpeedType:

  • Materials
  • Supplies
  • Freight
  • Installation and Training Labor
  • Construction Labor
  • Indirect Costs (IDC)Ìýwhen there is a deliverable to the sponsor

Important Notes:

  • Materials and supplies necessary for the construction or testing of the fabrication that are not integrated into the final product should be charged asÌýproject supplies. ÌýThese not considered costs to be capitalized.

    Examples include fuels, gases, or compressed air.

  • DeliverablesÌýrefer to equipment built for an external entity that will retain ownership of the finished product. IDC is charged on fabrications that qualify as deliverables to the sponsor.

When a fabrication is finished, the department will:

  1. Verify Charges: Check that the charges assigned to the fabrication SpeedType(s) are correct and appropriate.
  2. Notify PAO: Inform the Property Accounting Office (PAO) about the completion.
  3. Multiple SpeedTypes: If the fabrication was funded by multiple awards, it can be charged to several SpeedType(s). Be sure to provide all relevant SpeedType(s) to PAO.
  4. Data Entry: PAO will enter the total charges into PeopleSoft, and the fabrication will start to depreciate.
  5. Property Tag: Attach the property tag to the completed fabrication.

At the time of award closeout, the status of a fabrication can be one of the following:

  1. Complete and In Service: The fabrication is finished and ready for use.
  2. Needs Additional Work: More work is required before it can be used as intended. This will continue under a new fabrication SpeedType.
  3. Cost Below Threshold: If the total cost of the fabrication is less than $5,000 or it doesn’t have a useful life of at least one year, the costs must be moved to a different account to finalize the financial closeout.
Need help?

Email the OCG Compliance Team atÌýOCGProperty@colorado.edu