IPWEA s Asset Management Tools

Transcription

1 IPWEA s Asset Management Tools Practice Notes 34 NAMS.AU Practice Notes Published Condition Assessment Guidelines Preamble 1. Footpaths Condition Assessment Guidelines (2007) 2. K & C Condition Assessment Guidelines (2008) 3. Buildings Condition Assessment Guidelines (2009) 4. AM for Small, Rural or Remote Communities (2011) 5. Stormwater Condition Assessment Guidelines (2011) 6. Long Term Financial Planning (2011) 7. Water and Sewerage Condition Assessment Guidelines (2013) In development Levels of Service & Consultation 35

2 AIFMG Updates Six Monthly Review of Standards and issue of Updates to Guidelines July 2010 Update 1* (hard copy 143 pages) Jan 2011 Update 2 (pdf download 34 pp) Jan 2012 Update 3 (pdf 78 pp) Nov 2013 Update 4 Updates are available from * Fee payable for Update 1 47 Fair Value Hierarchy Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity access at the measurement date (eg motor grader) Level 2 inputs are other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly (eg home unit value based on similar units) Level 3 inputs are unobservable inputs for the asset or liability (eg value of infrastructure based on depreciated replacement cost) 181

3 Network Asset Example Signs network assets initial recognition in 2010/11 5,000 $200 = $1,000,000 CRC 10 network signs assets (10 yr assumed life) Signs (500) acquired in 2002 $100,000 CRC Signs (500) acquired in 2011 $100,000 CRC 520 new/replacement signs recognised at 30 June 2012 Signs (520) acquired in 2012 $104,000 $200) Signs (500) acquired in 2002 reach end of useful life (written off) End of year 5020 signs $1,004,000 CRC $504,000 DRC ($500k + $104k - $100k deprn) 188 Residual Value Estimated amount that an entity would currently obtain from disposal of the asset after deducting costs of disposal, if the asset were already at the age and in the condition expected at the end of life Used to determine depreciable amount where depreciable amount cost or current cost less residual value Source: AIFMG, 2009, Glossary, pp xlii 193

4 Residual Value Residual value may be recognised where an asset can be sold/traded and amount received from sale/trade is greater than the cost of the sale/trade 194 Residual Value Residual value has been used in a technical interpretation of good asset management practices to recognise optimum renewal techniques Where service potential is renewed for less than the cost of replacement e.g. Pipeline lining Road pavement recycling 195

5 Residual Value There are varying opinions as to whether this technical interpretation meets Accounting Standards Recognition of internal salvage value?? No sale of asset?? No amount received from disposal?? Public infrastructure assets are provided as a public service and is generally not sold to raise revenue 196 Residual Value Residual value use should be limited to instances where amount received from sale/trade of asset to a third party is greater than cost of sale/trade if the asset was already at the age and in condition expected at end of its useful life. 197

6 Recognising optimal renewals Actions to recognise optimal renewals Additional appropriate componentisation Recognise assets managed as separate components Valuation as modern equivalent asset Cost currently required to replace the service capacity of the asset (component) 198 Componentisation Planned recycling of road pavement base Components based on how pavement is to be managed Pavement base life ~ 50 years Pavement Sub-base ~ 100 years 199

7 Modern Equivalent Asset Value Cost to replace the service potential Valuation as modern equivalent asset Wearing Surface cost of next resurfacing Pavement base cost of next recycling Pavement sub-base cost of replacement Evidenced by renewal strategies in AM Plans 200 Taking a long term view to Infrastructure Financial Management A common Technical and Financial view through Asset Management Plans & Long Term Financial Plans Allen Mapstone, JRA M E allen.jra@bigpond.com Jeremy McAnally, JRA M E jmcanally@jr.net.au Jim Dixon, GAAP Consulting M E jimdixon@iprimus.com.au John Comrie, JAC Comrie P/L M E john@jaccomrie.com.au 231