" Our current retention period and regulatory requirements state that these be retained for Fiscal Year + 4.  However, that policy is being questioned, and it has been suggested that these records be retained for the life of the asset + 4.  Obviously, this is a significantly longer retention period for some assets!"



Chad, a first step is to confirm whether any governmental entity or government contractor-specific requirements control for JHUAPL regarding these capital asset records.  If not, the approach of our clients that are private sector entities generally is to retain key records documenting capital asset cost and depreciation for the "life" of the asset + X years.  Life of the capital asset for accounting/tax purposes usually means its lifespan for depreciation or other tax and accounting positions taken by the entity, and often may extend until asset disposition.  The "X" year tail is to cover the ensuing reasonable period for current year tax exposure, and four years may be a bit short, given the ability of state tax authorities to have extended times for assessments after federal tax positions are amended or adjusted, among other factors.  Tax-exempt entities prudently retain such records similarly, in case of audit and also due to the remote risk of losing exempt status (tax-exempt entities are subject to IRS regulation 26 CFR §1.6001-1<https://www.ecfr.gov/cgi-bin/text-idx?SID=86c41002ad19c085db16b5ba29d53265&mc=true&node=se26.15.1_16001_61&rgn=div8> requiring retention of accounting records for as long as the records may become material in the administration of any internal revenue law).


Peter Sloan
Information Governance Group, LLC
o  816.366.8300
m 816.591.7810
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website www.infogovgroup.com<http://www.infogovgroup.com/>
blog www.informationbytes.com<http://www.informationbytes.com/>


Not legal advice in this forum.