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. Fabrications are considered capital equipment when they have an acquisition cost of $5,000 or more and a useful life of at least one year.
Fabrications are assigned a separate SpeedType in the financial system so that the costs for materials, supplies, freight, construction, installation, training or assembly labor can be segregated from other project costs. Use the eRA step-by-step guide for identifying a fabrication subclass in the project financials.
In most cases, fabrications should be completed and listed as in-service in the property record with sufficient time remaining during the period of performance for the completed fabrication to benefit the award.
1. Complete Fabrication Request Forms
- Submit both a Fabrication Request form and a ChartField Request form to the Property Accounting Office (PAO)
- Include relevant project information, the estimated cost, and completion date of the fabrication
- Confirm that the fabrication will be a unique, one-of-a-kind, non-commercially available, stand-alone piece of equipment
2. OCG Review and Approval
- Determine whether the fabrication is allowable (based on award terms)
- Confirm the award has sufficient available budget for fabrication
- Work with department to obtain sponsor approval, if required
3. SpeedType Set-Up by Property Accounting Office (PAO)
- Assign separate SpeedType and subclass for fabrication
- Notify department administrator of new SpeedType and subclass
The department should regularly review expenditures on the award and the fabrication SpeedType in order to ensure that charges applied to the fabrication are appropriate and consistent with university policies. Costs that should be charged to the fabrication SpeedType:
- Installation and Training Labor
- Construction Labor
- IDC when a deliverable* to sponsor
*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 project supplies and are not capitalizable fabrication costs. Examples of this would be fuels, gasses, or compressed air.
*Deliverables are equipment that is being built for an external entity that will retain title to the finished equipment. We do charge IDC on fabrications that are a deliverable to our sponsor.
The status of a fabrication at award closeout may be one of the following:
- The fabrication is complete and in service
- Additional work on the fabrication is needed before it can be used for its intended purpose; work and expenditures for the fabrication will continue on a new fabrication SpeedType
- The total cost of the fabrication never reached the $5,000 threshold or the fabrication does not have a useful life of at least one year and the component costs must be moved to a different non-fixed asset account code to complete the financial closeout.