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FMPM 323 - Disposal of Plant and Equipment
This Finance Procedure sets out the requirements for identifying and recording the disposal of items of Plant and Equipment to ensure the University's Capital Assets Register is accurate and disposals are recorded on a timely basis.
The procedure does not have application in respect of plant and equipment purchased under a grant, where the funding body specifies particular disposal procedures to be followed.
Gain or loss on disposal
It is the responsibility of Organisational Units to complete the Asset Disposal/Transfer Form for all equipment under their control that is:
no longer in use;
sold (auction, sale by tender, traded-in);
broken and not to be repaired;
to be transferred to another Organisational Unit; or
to be transferred to another Organisation.
Sale of Plant & Equipment
It is the responsibility of the Organisational Unit to:
determine the most appropriate method of disposal:
Internal Sale: by circulating a "Notice of Sale" for disposal by tender throughout the University;
External Sale: by placing an external advertisement for sale by tender;
evaluate tenders received; and
advise successful and unsuccessful tenders.
On production of an official University receipt the Organisational Unit:
arranges for collection of the items by the purchaser; and
completes the Asset Disposal/Transfer Form, including the method of disposal used and forwards the form to the Finance Officer, Assets Team, Financial and Business Services.
If the asset is transferred to another Organisational Unit, the receiving Organisational Unit must also sign the form before the transfer will be processed.
Where an Organisational Unit requires the services of the Divisional Procurement Team in disposing of the item the Asset Disposal/Transfer Form should be forwarded to the Divisional Procurement Team who will undertake the disposal of the item.
The Organisational Unit maintains physical custody of the item until contacted by the Divisional Procurement Team.
Conditions of Sale
The sale shall normally, but not necessarily, be to the person who makes the highest offer. Where a decision is made to sell by auction, the auction shall be conducted by a registered auctioneer. The costs of advertising, auctioning and any other cost associated with a sale shall reduce the proceeds to be credited to the Organisational Unit.
For disposal by sale the following general conditions apply:
Inspection: The items shall be available for inspection by interested parties.
No warranty given: No warranty shall be given as to the quality of the items, or as to their fitness for any particular purpose, notwithstanding any representations made in respect of the items, they shall be advertised to be sold as where they lie with all faults and with all errors and misstatements or description, measurement quality or otherwise and the purchaser shall have no claim against the University in respect of any such faults, errors or misstatements.
Payment: Payment for the items is to be made by cash or bank cheque to the University cashier before removal from the University.
Delivery: Unless otherwise agreed, delivery of items shall be affected by the removal of the items by and at the expense of the purchaser at the time and from the place specified by the University.
Property and Risk: The property and risk in the items purchased shall pass to the purchaser immediately upon payment being made for the items.
The Finance Officer, Assets Team, Financial and Business Services: Upon receipt of the Asset Disposal/Transfer Form the Finance Officer, Assets Team, Financial and Business Services updates the Register of Capital Assets. All disposal proceeds and the gain/loss on disposal are reconciled with the General Ledger. Gains and losses are attributed at the Organisational Unit level.
Proceeds of Sale
Except where special conditions exist (eg grants) the net proceeds of sale or transfer will be credited to the account nominated on the Asset Disposal/Transfer Form.
Theft or Loss
In the case of theft or loss of equipment, a Loss/Damage report must also be completed and forwarded to the Finance Officer, Finance & Taxation, Financial and Business Services. Refer FMPM 450: Policy - Insurance and FMPM 920: Policy - Losses
When plant and equipment is being traded-in:
the gross value of the purchase and the trade-in value must be shown on the purchase requisition; and
an Asset Disposal/Transfer Form completed for the item of equipment being traded-in.
Goods and Services Tax
For disposals that are taxable supplies for the purposes of the Goods and Services Tax, the purchaser should express the offer as inclusive of GST (refer FMPM 732: Procedure - Goods and Services Tax (GST)).
Related documents, legislation or JCU Statutes
For enquiries in relation to this FMPM Procedure please contact firstname.lastname@example.org
Deputy Vice Chancellor, Services and Resources
Deputy Vice Chancellor, Services and Resources
Date for next review
|17-1||08/12/2017||08/12/2017||Minor amendment to reflect current organisational structure||Quality, Standards and Policy|
Policy Sponsor and Approval Authority updated to reflect the approved Policy and Delegations Framework
Quality Standards and Policy Unit
There are no related procedures.
There are no other related documents.
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