As defined by BUS-29, Add-Ons (Upgrades) are “[c]omponent parts with a cost of [$5,000] or greater which permanently increase the value or useful life of a specific (as identified by the asset number) University-owned unit of inventorial equipment … Equipment upgrades valued at less than [$5,000] are to be expensed as non-capital transactions.”

The cost of add-ons or upgrades may be charged to an inventorial equipment object code if three criteria are met:

  1. The amount being added via the add-on or upgrade is at least $5,000 (the inventorial equipment threshold also applies to add-ons and upgrades).
  2. The add-on or upgrade is to an existing piece of inventorial equipment – that is, one that has an active UC property number. For example, if you wish to add $6,000 in value to a $3,000 spectrometer purchased after July 1, 2004 (and which, therefore, does not have a UC property number), the add-on will have to be paid on sub 3. You cannot “transform” an item of non-inventorial equipment into inventorial equipment by adding value to bring it above the $5,000 threshold.
  3. The component part(s) being added upgrade the capabilities or extend the useful life of the existing piece of inventorial equipment.

Given the preceding requirement, per BUS-29, the cost of Replacement Parts and Repairs, “regardless of cost, shall … be expensed [as non-inventorial transactions].” Replacement parts – where a worn-out component is replaced with a (near) identical one, to allow a machine to continue functioning – do not add any NEW value to a piece of inventorial equipment: the deleted value of the old, replaced component cancels out the new value. Similarly, the cost of repairing a piece of equipment does not add to its base value, it only maintains it (repair costs, if provided by an outside vendor, should be expensed to sub 3, object code 7260).

The only time that a replacement item may be expensed on an inventorial object code is if, when replacing a worn-out item, it is replaced with a newer/higher quality component – worth at least $5,000 – that upgrades the functioning and extends the useful life of an existing piece of inventorial equipment.