5.10 Deliverables to Sponsors

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Policy Information

Policy Number: 5.10 Effective Date: 
Responsible Unit: Property Management Last Revised Date: 06/30/2023
Email:  FNSV-PropertyManagement@arizona.edu Phone: 520-621-8609

Purpose and Summary

The purpose of this policy is to define what can be considered as Deliverable Equipment and to provide direction to University of Arizona (University) departments on cost accounting for a Deliverable. 


Arizona Board of Regents Policy, including but not limited to: 3-801 and 3-802
Public Law 100-679 (41 U.S.C. 1502)

Applies only to equipment purchased on sponsor funds or furnished by a sponsor: 

  • Government Property, 48 C.F.R. § 45
  • Government Property, 48 C.F.R. § 52.245-1
  • Government Property, 48 C.F.R. § 245
  • Government Property, 48 C.F.R. § 1852.245
  • Uniform Guidance, 2 C.F.R. § 200


This policy applies to all University locations and units, including all University extensions, satellite locations, and off-site campus units, both domestic and international.

Note: This policy covers equipment with components purchased on sponsor accounts where the final fabrication will not be used by The University in any way but will instead be delivered to a sponsor.


  1. Capital Movable Equipment (Capital Equipment): Equipment with a total cost of $5,000 or greater that is stand-alone, complete in itself and has a useful life of one year or more.
  2. Deliverable Equipment (Deliverable): Equipment fabricated by University personnel in connection to a sponsored project to which the University will not hold title and to which will be delivered to the sponsor or another party at the end of the project.
  3. Fabricated Equipment (Fabrication): A unique stand-alone piece of equipment constructed from individual parts that requires creative design effort by University personnel and cannot reasonably be purchased “off the shelf” from a vendor or commercial supplier (i.e., it is one-of-a-kind).  
  4. Production Equipment: Equipment necessary to produce Fabricated Equipment, and not intended to be incorporated into the equipment being produced.  
  5. Sponsor Titled Furnished Equipment: Equipment entrusted to the University by the sponsor under the terms of a Project or Contract. The sponsor maintains ownership.
  6. Sponsor Titled Acquired Equipment: Equipment purchased with sponsor funds under the terms of a Project or Contract. The Sponsor maintains ownership.


  1. Deliverable Equipment must be accounted for in the University official system of record with a property D-tag number and follow the cost accounting requirements outlined here. 
  2. Government regulations require that the cost of Deliverable Equipment be computed in accordance with generally accepted accounting principles. These principles must be followed to ensure accurate administration, accounting, classification, stewardship, and reporting of Deliverable Equipment. 
  3. Included and excluded costs in calculating the value of a Fabricated Equipment are listed below.
    Included in the asset value:
    The following expenses are included in calculating the value of a Deliverable:
    • Raw materials and parts to be affixed to the equipment. Quantities of goods acquired must be reasonable and directly allocable to the specific fabrication.
    • Reasonable start-up supplies and parts to be incorporated in or otherwise consumed in the research and development of the fabrication
    • Shipping and handling
    • Third party installation charges from outside vendors or authorized internal service centers
    Excluded from the asset value:
    The following expenses are not included in calculating the value of a Deliverable:
    • Production Equipment
    • Documentation
    • Repair or maintenance expense
    • Administrative support
    • Enhancements that are not integrated into the equipment
    • Facilities and Administrative (F&A) costs
    • Department Labor
    • Payroll Expenses
    • Travel
  4. Unused material remaining after the completion of the fabrication must be accounted for and reported according to University policies, applicable federal regulations and/or the terms and conditions under the sponsor award. All inquiries concerning handling of any excess material must be directed to Sponsored Projects Services (SPS) - Property team.
  5. The Deliverable Equipment may require use of Sponsor Titled Acquired Equipment or Sponsor Titled Furnished Equipment during fabrication. Standard capital movable equipment policy and procedures will be applied to the acquisition of Production Equipment.


Principal Investigator & Department

  1. At time of proposal, include Deliverable Equipment in the grant proposal equipment line item budget and budget justification submitted in UAccess Research for review and approval by Sponsored Projects Services (SPS).
  2. Upon receipt of award and prior to first purchase, the department shall complete section I of the Fabrication/Deliverable Equipment Request form.

Sponsored Projects Services

  1. Review and complete section II of the Fabrication/Deliverable Equipment Request form
  2. Forward to Financial Services, Property Management for D-Tag pre-assignment.

Property Management

  1. Review and complete section III of the Fabrication/Deliverable Equipment Request form.
  2. Log the pre-assigned D-tag number until the first purchase is made, and document is created in UAccess Financials.
  3. Provide the completed form to SPS and the PI/department.

Principal Investigator & Department

  1. Once approval is obtained from SPS and the pre-assigned asset tag number is received from Property Management, the department may proceed with purchasing the components for the Deliverable Equipment. Below are items to consider when creating a document in UAccess Financials:
    1. On the first purchase document, the completed Fabrication/Deliverable Equipment Request form shall be attached to the notes.
    2. Each purchase must reference the University pre-assigned D-tag number.
    3. If a purchase is split-funded, the cost allocation basis should be documented; sponsor restrictions may prevent split-funding.
    4. Allowable purchases are charged to object code 7760 (Capital Equipment - Other Owned).

Sponsored Projects Services & Property Management

  1. Review and process all purchase documents for correct usage of object codes in UAccess Financial.

Property Management

  1. Create and maintain asset records in UAccess Financials as purchases are made.

Sponsored Projects Services

  1. Complete any required property reports to sponsors, including annual report on Work-in-Process when applicable.

Principal Investigator & Department

  1. Department or PI communicates to SPS Property via email at property@arizona.edu that deliverable is completed and shipped to the sponsor. Shipping documents are to be attached to the email.

Sponsored Projects Services

  1. SPS Property prepares and submits a Property Record Change Form (PRCF) to Property Management to remove asset(s) from UAccess Financials’ Capital Asset Management (CAM) Module. 

Property Management

  1. The asset is retired in CAM based on the PRCF shipping document (using External Transfer retirement reason).

Frequently Asked Questions

  1. Are Fabricated Equipment and Deliverable Equipment charged Facilities and Administrative (F&A) costs, also referred to as indirect costs?
    The charges follow the F&A rate and base for the account.  If the account follows the standard Modified Total Direct Costs (MTDC) model under the University’s negotiated indirect cost rate agreement, capital purchases are excluded from the F&A base.  If the account does not follow this model, please reach out to SPS Postaward Services at sponsor@arizona.edu for guidance.
  2. What are some distinguishing characteristics of Fabricated and Deliverable Equipment?
    The main characteristics of Fabricated Equipment are:
    1. Creative effort in the design: If creative effort on the part of the University faculty is necessary for the completion of the design specification of the equipment, and if the equipment cannot reasonably be built by an off-campus vendor.
    2. Change in the name of the equipment: If the component parts of the finished equipment bear no relationship in name to the finished equipment, the activity should be considered fabrication. For example, a Time Machine is a piece of Fabricated Equipment consisting of many parts expertly fitted together thus creating an item that cannot be readily purchased.
    3. Complexity of construction: If the construction is complex, the activity is fabrication.

Related Information

Fabrication/Deliverable Equipment Request form
Arizona Board of Regents Policy Manual
Code of Federal Regulations