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Land, Building, and Equipment Fund (or Plant Fund). The plant fund accounts for the activity related to fixed assets, including the accumulation of resources to acquire or replace them and the liabilities related to them, as well as their acquisition, disposal, and depreciation.
To determine the total cost of rendering service, depreciation of assets employed in providing that service must be recorded in the plant fund, with the typical depreciation entry debiting Depreciation Expense and crediting Accumulated Depreciation.
The plant fund of a VHWO (Voluntary health and welfare organization)may have all three net asset classes: unrestricted, temporarily restricted, and permanently restricted. Unrestricted net assets may be transfers from current funds at the discretion of the governing board. Assets acquired with unrestricted funds are unrestricted.
Donor-restricted contributions specified for property and equipment are temporarily restricted. As with other not-for-profits, a VHWO(Voluntary health and welfare organization) may choose to release the restriction of these assets upon acquisition or over the useful life. Contributions of land are considered permanently restricted if the land cannot be sold. If no restriction exists, donated land is an unrestricted contribution.
