# Deferred Maintenance Reporting for Federal Facilities: Meeting the Requirements of Federal Accounting Standards Advisory Board Standard Number 6, as Amended(2001)

## Chapter: Hypothetical Example for One Facility

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Suggested Citation:"Hypothetical Example for One Facility." National Research Council. 2001. Deferred Maintenance Reporting for Federal Facilities: Meeting the Requirements of Federal Accounting Standards Advisory Board Standard Number 6, as Amended. Washington, DC: The National Academies Press. doi: 10.17226/10095.
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DEFINITIONAL ISSUES AND POTENTIAL REVISIONS 34 for the site and utility system numbers in calculating the total amount of deferred maintenance and repair. If the site and utility system numbers are not included, the following formula may apply: BMAR = [Sum (MS%)*(RC%)] CRV Where: MS% = major system percentage of CRV; RC% = repair cost percentage of CRV, as designated by the generalized condition level; and CRV = current replacement value of the building. If site and utility system numbers are included, the site percentage of facility CRV is multiplied by the repair cost (as a percentage of CRV), as designated by the generalized condition level. This number is then multiplied by the CRV of the site work. The utility system percentage of facility CRV is multiplied by the repair cost (as a percentage of CRV), as designated by the general condition level. This number is then multiplied by the CRV. The amounts for systems, site, and utility systems are summed. The final number is the dollar amount of deferred maintenance. BMAR = [(Sum (MS%)*(RC%)) CRV] + [(RCS%)*(SWCRV)] + [(RCUS%)*(RCUSCRV)] Where: MS% = major system percentage of CRV; RC% = repair cost percentage of CRV, as designated by the generalized condition level; CRV = CRV of the building; RCS% = repair cost percentage of CRV, as designated by the generalized condition level of the site work; SWCRV= CRV of the site work; RCUS% = repair cost percentage of CRV, as designated by the generalized condition level of the utility systems; and USCRV = CRV of the utility systems. Hypothetical Example for One Facility Office and laboratory facility â 15 years old. The building has a new roof and excellent interior finishes. The electrical systems, plumbing systems, and structure are adequate. The airconditioning and heating systems have been problematic since new, and the occupants are unhappy with the temperatures and air changes. CRV= \$4,500,000 for the building Exterior utility systems are considered as a separate facility. Condition Assessment: System Level % CRV % Facility Architectural 5 (0.01) (0.05) 0.0005 Roof 5 (0.01) (0.10) 0.0010 Electrical 4 (0.20) (0.15) 0.0300 Plumbing 4 (0.20) (0.15) 0.0300 HVAC 3 (0.50) (0.25) 0.1250 Structural 4 (0.20) (0.30) 0.0600 0.2465

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Deferred Maintenance Reporting for Federal Facilities: Meeting the Requirements of Federal Accounting Standards Advisory Board Standard Number 6, as Amended Get This Book
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In 1996 the Federal Accounting Standards Advisory Board (FASAB) 1 enacted Standard Number 6, Accounting for Property, Plant, and Equipment (PP&E), the first government-wide initiative requiring federal agencies to report dollar amounts of deferred maintenance annually. The FASAB has identified four overall objectives in federal financial reporting: budgetary integrity, operating performance, stewardship, and systems and control. FASAB Standard Number 6, as amended, focuses on operating performance and stewardship. The FFC Standing Committee on Operations and Maintenance has prepared this report to identify potential issues that should be considered in any future amendments to the standard and to suggest approaches for resolving them. The committee's intent is to assist the CFO Council, federal agencies, the FASAB, and others as they consider how best to meet the objectives of federal financial reporting for facilities.

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