Capital Asset Accounting
Accounting for capital assets in line with accounting standards and organizational accounting policies.
Level 1 Introductory: Demonstrates introductory understanding and ability and, with guidance, applies the competency in a few, simple situations. Can direct people to the appropriate source for further information.
BEHAVIORS
- Explains key concepts in accounting for capital assets (costs, estimated useful life, residual value, etc.) and how they interrelate.
- Describes accounting policies that govern the classification, treatment, and recording of capital assets.
- Inventories real property and equipment, recording information such as the description, value, and location of the property.
QUESTIONS
- Tell me about your understanding of capital assets based on your work experience.
Probing Questions
* What company policies were you required to follow?
* How did you determine the proper classifications?
* Why do you think it matters that the assets are properly classified?
- Describe your understanding of depreciation or amortization of capital assets.
Probing Questions
* What is the purpose of depreciation capital assets?
* What are the key considerations when determining what type of depreciation or amortization policy to use?
* Why is it important?
* How have you used this understanding of your work?
Level 2 Basic: Demonstrates basic knowledge and ability and, with guidance, can apply the competency in common situations that present limited difficulties.
BEHAVIORS
- Performs relevant computations required to adequately record capital assets in the books of account under supervision.
- Calculates and records amortization and depreciation based on the organization’s accounting policies.
QUESTIONS
- Describe your experience with recording non-straightforward capital assets.
Probing Questions
* What was a capital asset?
* Why was it non-straightforward?
* What guidance did you use to determine how to record the asset?
* Was the end result in accordance with company policy?
- Tell me about at least two different capital asset depreciation or amortization systems you have used.
Probing Questions
* What was the fundamental difference between the two policies?
* How did you decide which policy to use?
* What was the process you followed in the application of that policy? Was the policy choice the correct one in these circumstances?
Level 3 Intermediate: Demonstrates solid knowledge and ability, and can apply the competency, with minimal or no guidance, in the full range of typical situations. Would require guidance to handle novel or more complex situations.
BEHAVIORS
- Appraises and evaluates real property and equipment, recording information such as the description, value and location of the property.
- Describes the statements of accounting standards relating to the treatment of capital assets.
- Assists in establishing standards and conventions for the recording of capital assets (naming conventions, useful lives, asset classification, maintenance of capital asset ledger, etc.).
- Performs classification, computation and recording processes for capital assets without formal supervision.
- Tracks/monitors and communicates predefined capital asset Key Performance Indicators.
- Monitors capital asset records for potential obsolescence with a view to making recommendations for addressing the situation.
QUESTIONS
- Describe an example of when you participated in capital asset valuation or obsolescence determination.
Probing Questions
* What was your role in the evaluation?
* What other resources did you use?
* How did you formulate a conclusion on the valuation or obsolescence?
* How were your conclusions used by management?
- Describe capital asset key performance indicators you have prepared or monitored.
Probing Questions
* What were the situations where you monitored capital asset key performance indicators?
* What was the purpose of monitoring the KPI's?
* Where did you source the information?
* What use would management make of the KPI's?
Level 4 Advanced: Demonstrates advanced knowledge and ability and can apply the competency in new or complex situations. Guides other professionals.
BEHAVIORS
- Provides assistance in the definition of policies and standards for the classification, treatment and recording of capital assets.
- Coaches others on key concepts relating to capital assets treatment in the accounts.
- Plans and coordinates the efforts of others in accounting for items of capital assets and tasks.
- Defines KPIs for capital assets for individual divisions and the entire organization.
QUESTIONS
- Tell me about a time when you explained capital asset policies to non-financial managers.
Probing Questions
* Who was your audience?
* What was their interest in capital asset policies?
* How did you structure your explanation?
* What use was made of the information that you imparted?
- Describe a time when you participated in the formulation of capital asset policies and procedures.
Probing Questions
* What was your role in the definition?
* What information or knowledge did you need to effectively participate?
* What was your contribution to the final policy and procedures?
* What were the results?
Level 5 Expert: Demonstrates expert knowledge and ability, and can apply the competency in the most complex situations. Develops new approaches, methods, or policies in the area. Is recognized as an expert, internally and/or externally.
BEHAVIORS
- Defines accounting policies for the classification, treatment, and recording of capital assets.
- Advises the relevant Standards Board/Regulatory Body on matters requiring the modification of statement of accounting standards on capital assets.
- Recognized within and outside the organization as a Capital Assets Accounting expert.
QUESTIONS
- Tell me about your participation or involvement in standard-setting for capital assets.
Probing Questions
* What has your role been?
* How did you influence the development of standards?
* What were the contributions of other stakeholders? What were the results?
- Describe a time when you proposed a significant change in capital asset policy.
Probing Questions
* What was the proposed change?
* What prompted the change?
* What analysis did you draw on to make the proposal?
* Was the proposal accepted and implemented?