Effective Date: December 8, 2009
Last Reviewed: December 8, 2009
This policy describes the significant accounting policies of Stonehill College.
Basis of Accounting
The College uses the accrual basis of accounting in accordance with GAAP accounting (Generally Accepted Accounting Practices). Revenues are recorded when earned and expenses are recorded when incurred and measurable, regardless of when the related cash flows take place.
The College's financial statements are prepared in accordance with generally accepted accounting principles applicable to colleges and universities and pronouncements of the Financial Accounting Standards Board (FASB).
When an expense is incurred that can be paid using either restricted or unrestricted resources, the College’s policy is first to apply the expense toward restricted resources, then toward unrestricted. Restricted funds remain classified as such until restrictions have been satisfied.
Inventories are valued at cost based on FIFO methodology.
Investments in corporate stocks and marketable bonds are recorded at market value. Certain less marketable investments, principally real estate and private equity investments are generally carried at estimated values as determined by management. Because of the inherent uncertainty in the use of estimates, values that are based on estimates may differ from the values that would have been used had a ready market existed for the investments.
Capital Assets and Depreciation (see Fixed Asset Capitalization Policy)
Capital assets are stated at cost at date of acquisition, or fair market value at date of donation in the case of gifts. Depreciation of buildings, improvements other than buildings, and infrastructure is provided on a straight-line basis over the estimated useful lives ranging from ten to sixty years.
Depreciation of equipment and capitalized software is provided on a straight-line basis over estimated useful lives ranging from five to twenty years.
The College does not depreciate library books.
Fixed assets related to construction are capitalized as projects are complete. Projects that have not been completed as of the end of the fiscal year are classified as Construction in Process.
Capital assets, such as roads, bridges, sidewalks, and certain other non-building structures are considered capital improvements and are depreciated accordingly.
Funds Held in Trust by Others
Assets of funds held by trustees for the benefit of the College are presented in the College's Financial Statements. The College has irrevocable rights to all or a portion of the income of these funds, even though the assets of the funds are not under the management of the College.