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Suggested Citation:"REFERENCES." 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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Page 38
Suggested Citation:"REFERENCES." 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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Page 39
Suggested Citation:"REFERENCES." 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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Page 40

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DEFINITIONAL ISSUES AND POTENTIAL REVISIONS 38 SUMMARY One objective of federal financial reporting is to produce uniform and consistent information that will be valuable to Congress, decision makers, agency officials and the public and to produce that information cost effectively. FASAB Standard Number 6, as amended, is intended to provide uniform and consistent information on property, plant, and equipment, including dollar amounts of deferred maintenance and repairs. The standard allows agency management some flexibility in determining how to calculate and report deferred maintenance by specifying that agencies can use condition assessment surveys, a total life-cycle cost method or other methods identical or similar to condition assessment surveys and total life-cycle costing. Condition assessment surveys are recognized as a valid method for identifying and reporting maintenance and repair needs for facilities. The committee supports the inclusion of this methodology in FASAB Standard #6, as amended. However, concerns were raised that the standard implies or could be interpreted to imply that condition assessment survey information should be available for all facilities in an inventory and that such information should be updated annually. In practice, the availability of condition assessment survey data varies from agency to agency. Some agencies conduct condition assessments on a limited basis or for specific buildings in specific circumstances. Agencies that have instituted inventory-wide condition assessment programs typically reinspect facilities on cycle of every 3 to 5 years or longer. Chapter 3 describes a number of methodologies for reporting deferred maintenance and repairs that are similar to condition assessment surveys and the total life-cycle cost method or combine elements of the two. Statistical approaches or methodologies for facilities renewal like those described for the Alabama Commission on Higher Education, Stanford University, the University of Virginia, and the Department of Defense are typically developed for planning and budgeting purposes. Dollar amounts for deferred maintenance are extrapolated by comparing forecasts for needed maintenance and repairs and actual expenditures; deferred maintenance is estimated as the difference between the two. As such, the methodologies are based on a time standard, not on specifically identified deficiencies. Backlog of maintenance and repair becomes a dollar figure that is the difference between a benchmark budget for maintenance and repair activities based on the projected life of systems and facilities and actual expenditures for maintenance and repair activities. However, as shown by the Stanford University model test, these types of methodologies can be effective in generating an estimated dollar amount for deferred maintenance and repairs. Allowing federal agencies greater flexibility in choosing methodologies, including statistical sampling, to report deferred maintenance for facilities may help to better align the objectives and methodologies of federal financial reporting. REFERENCES AME (Applied Management Engineering). 1991. Managing the Facilities Portfolio: A Practical Approach to Institutional Facility Renewal and Deferred Maintenance. Washington, D.C.: National Association of College and University Business Officers. Biedenweg, R. 1982. Before the Roof Caves In: A Predictive Model for Physical Plant Renewal. APPA Newsletter, Association of Physical Plant Administrators, Part 1 (July 1982), Part 2 (August 1982). Alexandria, VA: Association of Physical Plant Administrators (APPA).

DEFINITIONAL ISSUES AND POTENTIAL REVISIONS 39 Biedenweg, R., and Alan Cummings. 1997. Before the Roof Caves In, Part II: A Predictive Model for Physical Plant Renewal. Alexandria, VA: Association of Higher Education Facilities Officers (APPA). EMR (Enviro-Management & Research, Inc.). 2000. Final Summary Report. Survey of NASA Backlog of Maintenance and Repair. Arlington, VA: EMR. FASAB (Federal Accounting Standards Advisory Board. 1993. Objectives of Federal Financial Reporting. Statement of Federal Financial Accounting Concepts, Number 1. Online: www.financenet.gov/financenet/fed/fasab/pdg/sffac-1.pdf. FASAB. 1996. Accounting for Property Plant, and Equipment. Statement of Recommended Accounting Standards, Number 6. Online: http:// www.financenet.gov/financenet/fed/fasab/concepts.htm. Janke, J. 2000. Presentation on the Department of Defense Facilities Sustainment Model by Jay Janke, Office of the Secretary of Defense (Installations) before the Federal Facilities Council Standing Committee on Operations and Maintenance, National Research Council, Washington, D.C., January 19. NRC (National Research Council). 1998. Stewardship of Federal Facilities. A Proactive Strategy for Managing the Nation's Public Assets. Board on Infrastructure and the Constructed Environment. Washington, D.C.: National Academy Press. Phillips, Cushing, Jr. 1986. Facilities Renewal: The Formula Approach. Alexandria, VA: Association of Physical Plant Administrators. Rugless, J. 1993. Condition assessment surveys. Facilities Engineering Journal 21(3): 11-13. Sanford, K., and Sue McNeil. 1997. Data Modeling for Improved Condition Assessment. p. 287-296 in Infrastructure Condition Assessment: Art, Science, and Practice. Mitsuru Saito, ed. New York: American Society of Civil Engineers. Syme, Preston T., and Jay Oschrin. 1996. How to Inspect Your Facilities and Still Have Money Left to Repair Them. Alexandria, VA: Association of Higher Education Facilities Officers (APPA).

DEFINITIONAL ISSUES AND POTENTIAL REVISIONS 40

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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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