Chapter 3: Acquisition and Receiving


Equipment that is constructed and developed by combining discrete components/and or materials into one identifiable unit, with an acquisition cost of $5,000 or more and the estimated useful life of at least one year is added to the University's inventory. Federal regulations require that if the finished fabrication has a unit cost of $5000 or greater and a useful life of more than one year to be reported on the inventory as equipment. Initiation of the fabrication begins when the principal investigator completes a Fabrication Request including the dates, expected cost and funding source, and detailed description of the fabrication.   

During the construction process of fabricated equipment, the department must ensure that all expenses included in the fabricated item's cost are coded E044 and reference the tag number. The types of expenditures allowed include materials, supplies, and external services.

There are two categories of fabricated equipment:

  • Non-Capital Fabricated Equipment: Equipment fabricated for sale or for delivery to an external entity per the sponsor's instructions. The University does not retain title to this equipment nor will it be available for future University use.
  • Non-Capital Fabricated Equipment may be delivered to the sponsor's location or another research organization that will further the sponsor's research purposes and will be subject to overhead charges. Separate expenses for constructing non-capital fabricated equipment will be coded E6** (supplies) or E2** (services).

  • Capital Fabricated Equipment: Capital equipment, $5,000 or greater, which is constructed for use on a contract or grant, and will remain in the possession of the University.  Capital Fabricated Equipment is assigned a University equipment tag number and added to the department equipment inventory list.

Departmental labor, travel, and other departmental operating expenses associated with the fabrication will not be recorded as costs.

Upon initial construction of capital fabricated equipment, the department does the following:

  1. With the initial purchase requisition, completes a Fabricated Equipment Form with the following information:
    1. A complete description of the equipment.
    2. The equipment’s location.
    3. The custodial department.
    4. The account index.
    5. The anticipated completion date.
    6. An estimated total cost of the finished item.
  2. Forwards the completed purchase requisition and fabricated equipment form to the Purchasing Department. NOTE: Upon receipt of the form, Financial Services and Operations will assign an equipment tag number for the fabrication.
  3. The tag number must accompany future acquisitions.

Upon completion of the project, the PI certifies a detailed inventory report from Financial Services and Operations of consumables and verifies the usage of each item. When the equipment is substantially complete, a property tag is issued for the fabricated equipment.

Disposition of unused supplies are reported as required by FAR part 45.