Procurement Policies and Procedures
There are two types of leases:
- Capital Lease - a long-term financing arrangement that transfers substantially all the benefits and risks of ownership to Clemson University . The type of asset associated with the lease will determine which account should be used on the purchase document. Capital Leases for buildings is being charged to 8198, debt reclassification.
- Operating Lease - rental of property for which Clemson has no current or future rights of ownership and has a legal obligation to rent for an extended period of time. Account 7314, is used for equipment operating leases. For property (buildings), office space, etc. account 7340 should be used, if it totals over $25,000, although sometimes Accounting Services keeps track of them even if they are less because of the extended time frame or other reasons.
Rent is classified as property for which Clemson has no current or future rights of ownership and has no legal obligation to rent for an extended period of time. Example of this would be rental of tables from Clemson Rent All for an on campus conference.
If the lease or rental payments will exceed $2,500 in a fiscal year, the monthly payments should be made on a purchase order or for copier leases, payments maybe processed with the departmental procurement card. If P-card is the payment method for copier leases, it is the department's responsibility to ensure encumbrance amounts are closed and that the vendor is charging the correct amount based on the terms of the original PO.
updated June 2013