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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 43
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 44

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DEFERRED MAINTENANCE AND REPAIRS AS AN INDICATOR OF FACILITY CONDITION 43 current replacement value were, instead, $370 billion, deferred maintenance would equal 10 percent of current replacement value, which could indicate a more deteriorated condition. Similarly, using hypothetical numbers, if the current replacement value of NASA's inventory were $18 billion, a backlog of $1.4 billion would be equal to 7.8 percent of current replacement value and would appear to indicate that NASA's facilities might be in better overall condition that DoD's. However, these types of comparisons would still not be particularly meaningful unless and until they were tracked over time using consistent methodologies for calculating both deferred maintenance and repairs and current replacement value at each agency (i.e., the agencies would not have to use the same methodology). Over a 5-year period, if DoD's backlog of maintenance and repair as a percentage of current replacement value decreased while NASA's increased, it could indicate that the overall condition of DoD's inventory was improving while NASA's was declining. The factors underlying these trends could then be investigated. Some federal agencies, such as the U.S. Army, track the condition of their facilities using a rating system (i.e., excellent, good, fair, unsatisfactory) and a computerized database. From the rating information contained in the database, agencies could generate a report identifying the percentage of their facilities falling into the lowest category—for example, 15 percent of facilities have been rated unsatisfactory. This information would provide the percentage of an agency's facilities that are below a satisfactory condition and may be another approach for providing information regarding the condition of federal facilities. This approach could be useful for tracking trends over time and to review whether the condition of an agency's facilities has improved or declined. The Federal Facilities Council Standing Committee on Operations and Maintenance was not tasked with determining what combination of measures might best fulfill the objectives of federal financial accounting. Additional study and consideration of potential measures that could be used in conjunction with deferred maintenance and repairs to help evaluate the condition of federal assets are needed. REFERENCES NRC (National Research Council). 1995. Measuring and Improving Infrastructure Performance. Board on Infrastructure and the Constructed Environment. Washington, D.C.: National Academy Press. NRC. 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.

DEFERRED MAINTENANCE AND REPAIRS AS AN INDICATOR OF FACILITY CONDITION 44

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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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