The University of Tennessee, Knoxville

Tennessee County Municipal Advisory Service

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Establishing a Capital Asset Accounting System

Reference Number: MTAS-629
Tennessee Code Annotated
Reviewed Date: September 11, 2017
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In most small and medium-size cities, establishing a CAAS is not a major undertaking. However, planning, direction and cooperation are needed to achieve satisfactory results.

The following steps are suggested to establish the initial capital asset record:

  • Assign one responsible individual the task and authority for establishing capital asset records.
  • Take an initial physical inventory to collect all essential information. Description, assigned department, location, model number, serial number, manufacturer, size, and capacity are a few of the suggested identifying characteristics of each asset.
  • Establish a value for all capital assets. Use historical cost records if available, or estimate value. Documentation is important.
  • Complete and file an individual property record card or computer file on each capital asset.
  • Label or tag capital assets. Adhesive metal tags or labels are convenient for marking each asset.