2.2.2. Fabricating Property
A fabrication is the transformation of materials, non-consumable supplies, and hardware into a one- of-a-kind piece of equipment or scientific instrument that meets a unique research need and cannot be commercially obtained. It has a total acquisition cost of $5,000 or greater and a useful life of at least one year and is by itself functionally complete for its intended purpose. ÌýIn addition:
- Every component must be necessary and essential for the function of the entire fabrication to the extent that the removal of one component would diminish the operation of the entire fabrication.
- Applicable fabrication costs may include materials and supplies that are integrated into the fabricated unit, freight, construction, installation, training, or assembly labor.
- Materials and supplies that are necessary for the construction process or testing of the fabrication but are not integrated as final components of the fabricated unit must be charged as supplies that cannot be capitalized fabrication costs. Examples of this would be fuels, gasses, or compressed air.
See the Property Accounting Office’s Capital Equipment Standard Operating Procedures for further details on the capitalization requirements for fabrications.
Title and Authorization: Title to property fabricated by the university vests with the university, Government, or non-federal sponsor, depending upon the terms of the award. Fabrication charges on sponsored projects must be segregated into a separate ST dedicated to that fabrication. OCG confirms where title vests when reviewing individual fabrication ST requests and ensures that authorization to build the fabrication has been obtained from the sponsor. The fabrication ST request process is outlined below.
Fabrication SpeedType Request Process:
- Complete Fabrication Request Forms: When a fabrication is deemed to have a role in fulfilling the research objective of a sponsored project, then prior to incurring expenditures for the fabrication the PI must submit both a Fabrication Tag Request Form and a Chart Field Request form to PAO. The forms should include relevant project information, the estimated cost and completion date of the fabrication, a certification that the fabrication will be a unique, one-of-a-kind, non-commercially available, stand-alone piece of equipment, and whether that fabrication is a deliverable in the project SOW.
- OCG Approval: OCG reviews the fabrication request to determine whether the fabrication is allowable under the award terms and if it was included in the proposed budget. Additional information or sponsor permissions may be required for OCG approval.
- SpeedType Set-Up: After OCG provides approval for the fabrication request, a separate ST and sub-class are established by PAO for the fabrication. All fabrication expenditures should be charged to the separate ST and sub-class and should all be charged to account code 810700 or 810800. The department reviews expenditures on the award and the fabrication ST to ensure that charges applied to the fabrication are appropriate and consistent with university policies.
- Fabrication Status during Construction: Tags are not physically affixed to fabrications nor are the tag numbers entered into the university property record while they are under construction. Upon completion of a fabrication, the department notifies PAO that the fabrication is in service and the relevant data are entered in PSAM. See section 3.6 Placing Fabrications in Service for more information on the process for placing fabrications into service.
Allowable Fabrication Costs: During the fabrication process, costs that should be charged to the fabrication ST and sub-class may include equipment, materials and supplies that are integrated into the fabricated unit, freight, installation, training and construction/assembly labor. NASA fabrications include labor costs associated with personnel physically assembling the fabrication.