ASSET MANAGEMENT POLICY

1 ASSET MANAGEMENT POLICY For implementation as from 1 July 2019 2 TABLE OF CONTENTS 1. DEFINITIONS AND ABBREVIATIONS 3 2. OBJECTIVE OF THE ASSET MANAGEMENT POLICY 5 3. ROLE OF THE ACCOUNTING OFFICER 5 4. ROLE OF THE CHIEF FINANCIAL OFFICER 5 5 ROLE OF OTHER DEPARTMENTS 8 6 DEFINITION OF AN ASSET 10 7 FORMAT OF THE ASSET REGISTER 11 8 CLASSIFICATION AND IDENTIFICATION OF PPE 13 9 HERITAGE ASSETS 15 10 DONATED/ BEQUEATHED ASSETS 16 11 AGRICULTURAL ASSETS 16 12 INTANGIBLE ASSETS 18 13 CAPITALISATION CRITERIA 20 14 CALCULATION OF CAPITALISATION COST OF ASSETS 21 15 RESIDUAL VALUES 23 16 DEPRECIATION OF ASSETS 24 17 REVALUATION OF ASSETS 29 18 DISPOSAL OF ASSETS 30 19 RECOGNITION OF ASSETS IN FINANCIAL STATEMENTS 33 20 FUNDING SOURCES 34 21 IMPAIRMENT LOSSES 35 22 INVESTMENT PROPERTY 37 23 REPLACEMENT STRATEGY 43 24 ASSET RISK MANAGEMENT 44 25 MAINTENANCE OF ASSETS 45 26 GENERAL REQUIREMENTS 46 3 1. DEFINITIONS AND ABBREVIATIONS Item Description ASSET An ASSET is a resource, tangible or intangible, controlled by the entity as a result of past events which is expected to be used during more than one reporting period and from which future economic benefits or service potential will flow.

Section 63 of the MFMA states that:- (1) ... and funded is included in the budget for consideration by council. A clear description of the funding source is also required. o Shall include a capital …

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