SESSION 10

ASSET SEGMENT
PRESENTED BY: NATIONAL TREASURY

ASSET SEGMENT
New segment on BAS
Distinguish Assets and Non Assets
Purpose:
Improved management of assets
Proper recording of expenditure

BENEFITS: ASSET SEGMENT

One central list of all capital assets
Economic classification - Project segment
Asset segment provides for

Tangible: Physical, Movable/Immovable

Intangible
Non-assets
Assets less than R 5 000
Classes and sub-classes of assets

Asset items Breakdown allowed

Aligned to categories in AFS/Asset registers 3

AUDIENCE QUESTION
Why should the breakdown facility on the asset
segment be utilised if it can be done in the
project segment?
A project consists of different assets with no
departmental specific detail and direct link
between them. The asset segment breakdown
can provide the detail.

METHODS OF ACQUISITION

Asset purchasing (buy)

Asset construction (build)
Hiring of assets
Asset transfers
Asset exchanges

AUDIENCE QUESTION
Is the item segment not describing the type of
asset?
No. It only indicates the method of acquisition.
Where asset is purchased:
Item: Elevator/Escalating systems
Asset: Tangible capital asset: Buildings and
Other fixed structures: Non-residential buildings:
Office building
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AUDIENCE QUESTION
(CONTINUED)
Is the item segment not describing the type of
asset?
Where asset is leased:
Item: Lease payments
Asset: Tangible capital asset: Buildings and
Other fixed structures: Non-residential buildings:
Office building

GRAP APPLICABLE TO
ASSETS

GRAP 11 - Construction Contracts

GRAP 12 Inventories
GRAP 13 Leases
GRAP 16 Investment Property
GRAP 17 Property, Plant and Equipment
GRAP 100 Non-Current assets for sale
GRAP 101 Agriculture
GRAP 102 Intangible Assets
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ASSET SEGMENT: ANALYSIS

TWO QUESTIONS
What is the distinction between an asset
(capital) and non-asset (current) expenditure?
AND
Does the transaction relate to an asset, and if
so, which category of asset?

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SEGMENT CATEGORIES
Major Asset segment classes

Buildings and other fixed structures

Machinery and equipment
Heritage assets
Biological/Cultivated assets
Specialised Military assets
Software and other intangible assets
Land and subsoil assets
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ASSETS DEFINED
Asset Components of definition

Resource
Control
Future economic benefits/service potential
More than one reporting period

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ASSETS DEFINED
Buildings and other fixed structures
Buildings
Fixed structures inhabitable by people, animals,
plants or utilised as storage areas

Other fixed structures

Structures other than buildings i.e. roads, dams,
bridges

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ASSETS DEFINED
Biological/Cultivated assets
Biological assets are living animals or plants
which are actively managed to effect biological
transformation

Machinery and equipment

Mechanical or electrical appliances, including
furniture, utilised in execution of tasks

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ASSETS DEFINED
Land and subsoil assets
Land excludes
Improvements or
Cost of transfer of ownership
Subsoil assets proven reserves of oil,
mineral and ore

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ASSETS DEFINED
Intangible assets
Identifiable
Non-monetary asset
Without physical substance

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INTANGIBLE ASSETS DEFINED

Identifiably criteria:
Capable of being separated and dealt with
individually
Arises from contractual rights, excluding rights
granted by statute

Distinguish goodwill and intangible

Goodwill payment in anticipation of future
economic benefits from assets that cannot be
individually identified
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INTANGIBLE ASSETS DEFINED

Assets incorporating tangible and non-tangible
features: Exercise judgement to assess which
element is more significant
Knowledge may result in physical asset.
Physical substance secondary to knowledge
embodied in asset

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AUDIENCE QUESTION
The department has developed software
utilised by Land and Quantity surveyors, how is
this classified in the asset segment?
Allocated to following asset class
Item: Inventory/Compensation of Employees
Asset: Intangible asset

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ASSETS DEFINED
Heritage assets
Assets that have unique cultural, environmental,
historical, natural, scientific, technological, or
artistic significance for the benefit of future
generations

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AUDIENCE QUESTION
Are maintenance, repair and running costs
allocated to assets in the asset segment and if
so why?
Yes, in order to identify the asset and track
accumulated expenditure on that asset/group

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EXAMPLE ALLOCATIONS
Repairing a standalone air-conditioner
Allocation
Item: Contractors: Maintenance of Equipment
Asset: Tangible capital asset: Machinery and
Equipment: Other machinery and equipment:
Building Air-conditioning system

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EXAMPLE ALLOCATIONS
Buy a truck to be used in construction of a
community centre
Allocation
Item: Purchase/Construction Capital assets:
Machinery and equipment: Transport equipment:
Trucks
Asset: Tangible capital asset: Machinery and
Equipment: Transport equipment: Trucks
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EXAMPLE ALLOCATIONS
Permit issued for a hiking trail in a Provincial
Park
Allocation
Item: Sales: Goods and Services: Administrative
Fees: Hiking Trails
Asset: Non-assets related

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EXAMPLE ALLOCATIONS
The department is constructing a dam utilising
consultants
Allocation
Item: Consultants and Professional Service:
Engineering Civil
Asset: Tangible capital asset: Other Fixed
Structures: Water Dams

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EXAMPLE ALLOCATIONS
The department is constructing a car park from
own account?
Allocation
Item: Inventory/Compensation of employees
Asset: Tangible asset: Other fixed structures:
Car Park

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EXAMPLE ALLOCATIONS
The department transfers funds for asset
construction to a municipality
Allocation
Item: Transfers and Subsidies
Asset: Non-asset

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AUDIENCE QUESTION
What asset allocation should be used for a
payment of a Travel & Subsistence advance?
Non-asset No resource controlled, no future
economic benefits/service potential

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ASSET SEGMENT SUMMARY

Provides for details of asset classes
Eliminates duplication in Item Segment
Allows for capturing of own account
transactions
Alignment with the Asset Management Guide
Not Asset Register

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For any additional questions or issues for

clarification, please contact the National
Treasury SCOA Technical Committee at:
Call centre: (012) 315 5311
E-mail: scoa@treasury.gov.za
Website: http://scoa.treasury.gov.za

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