Minimum Levels of Componentisation for Road Infrastructure Assets - - PowerPoint PPT Presentation

1

Minimum Levels of Componentisation for Road Infrastructure Assets

11 September 2018

2

Today’s moderator

Eliz Esteban Communications Officer Austroads P: +61 2 8265 3302 E: eesteban@austroads.com.au

3

About Austroads

The peak organisation of Australasian road transport and traffic agencies

• Roads and Maritime Services New South Wales
• Roads Corporation Victoria
• Department of Transport and Main Roads Queensland
• Main Roads Western Australia
• Department of Planning, Transport and Infrastructure South Australia
• Department of State Growth Tasmania
• Department of Infrastructure, Planning and Logistics Northern Territory
• Transport Canberra and City Services Directorate, Australian Capital Territory
• Department of Infrastructure, Regional Development and Cities
• Australian Local Government Association
• New Zealand Transport Agency

4

Our structure

5

Housekeeping

Presentation = 35 mins Question time = 15 mins

+ =

www.austroads.com.au/webinars

6

GoToWebinar

Please type your questions here

Let us know the slide number your question relates to

7

Austroads Guideline and research report

Download from Austroads Website: https://austroads.com.au/publications/asset-management/ap-r577-18 https://austroads.com.au/publications/asset-management/ap-r576-18

8

Gary Rykers (presenter) Manager Asset Management Victoria & Tasmania Project Technical and Stakeholder Lead wsp-Opus M: +61 477 344 260 Andrew Golding (Q&A) Director, Transport System Asset Management Department of Transport and Main Roads P: (07) 3066 0823 or 0407 114 676 E: andrew.c.golding@tmr.qld.gov.au

Today’s presenter

9

Agenda

Topic Presenter Project Background and Introduction Gary Rykers (Technical and Stakeholder Lead) Why? What? Project Scope Research Report Terminology Stakeholders Guideline How? Implementation Impacts Hypothetical Case Study Q&A Andrew Golding (Austroads Project Manager)

10 10

Project Background and Introduction

11 11

Introduction to Team

Austroads Project Manager

Andrew Golding

wsp Opus Project Leader

Susan Chamberlin

wsp Opus Technical & Stakeholder Lead

Gary Rykers

Austroads Project Working Group Stakeholders- Finance and Audit Industry Representatives Austroads Assets Task Force Austroads Board

Project Team Review Team

12 12

The Project Team

Liam Terris & Patrick Carr RMS NSW Daniel Verdouw

DSG Tas Kelly Dang

VicRoads Soula

Efstathiadis

DPTI SA Ian Barr MR WA Andrew Golding TMR QLD Shane Tepper DIPL NT

Austroads Project Working Group

Neil Pincombe TCCS ACT Wayne Robinson NZTA Kym Foster ALGA Matt Barry NTC Mick Savage IPWEA Patrick Flemming

Qld Audit Office

Ric De Santi

Tas Audit Office

John Comrie Independent Auditor

13 13

Project Purpose

• To develop prescriptive guidance material that will facilitate improved

integration of Asset Management and Financial Management disciplines. The project will deliver prescriptive guidance regarding minimum levels of componentisation for complex assets, applicable to State / Territory Road Agencies and Local Government Authorities.

• The project deliverables will provide a benchmark to stakeholders and users

(i.e. road management authorities & auditors) for driving a more consistent approach to preparation of financial statements. In turn, this will enable more efficient collation of national data sets used to enable equitable reform initiatives, such as national funding reform.

14 14

Project Purpose

• To develop prescriptive guidance material that will facilitate improved

integration of Asset Management and Financial Management disciplines. The project will deliver prescriptive guidance regarding minimum levels of componentisation for complex assets, applicable to State / Territory Road Agencies and Local Government Authorities.

• The project deliverables will provide a benchmark to stakeholders and users

(i.e. road management authorities & auditors) for driving a more consistent approach to preparation of financial statements. In turn, this will enable more efficient collation of national data sets used to enable equitable reform initiatives, such as national funding reform.

15 15

Project Purpose

• To develop prescriptive guidance material that will facilitate improved

integration of Asset Management and Financial Management disciplines. The project will deliver prescriptive guidance regarding minimum levels of componentisation for complex assets, applicable to State / Territory Road Agencies and Local Government Authorities.

• The project deliverables will provide a benchmark to stakeholders and users

(i.e. road management authorities & auditors) for driving a more consistent approach to preparation of financial statements. In turn, this will enable more efficient collation of national data sets used to enable equitable reform initiatives, such as national funding reform.

16 16

Project Purpose

• To develop prescriptive guidance material that will facilitate improved

integration of Asset Management and Financial Management disciplines. The project will deliver prescriptive guidance regarding minimum levels of componentisation for complex assets, applicable to State / Territory Road Agencies and Local Government Authorities.

• The project deliverables will provide a benchmark to stakeholders and users

(i.e. road management authorities & auditors) for driving a more consistent approach to preparation of financial statements. In turn, this will enable more efficient collation of national data sets used to enable equitable reform initiatives, such as national funding reform.

17 17

Project Purpose

• To develop prescriptive guidance material that will facilitate improved

integration of Asset Management and Financial Management disciplines. The project will deliver prescriptive guidance regarding minimum levels of componentisation for complex assets, applicable to State / Territory Road Agencies and Local Government Authorities.

• The project deliverables will provide a benchmark to stakeholders and users

(i.e. road management authorities & auditors) for driving a more consistent approach to preparation of financial statements. In turn, this will enable more efficient collation of national data sets used to enable equitable reform initiatives, such as national funding reform.

18 18

Why?

How?

10 mins

What?

20 mins

Why?

5 mins

19 19

Asset Classification Structure

“The classification of asset is one of the most important steps in financial reporting, asset accounting and asset management. Asset managers rely on an asset hierarchy classification for service planning, management and cost and performance reporting. Assets should be classified to suit both financial reporting and asset management

• purposes. The needs of accountants and asset managers should be identified and

considered fully in developing the asset classification and hierarchy.”

• Australian Infrastructure Financial Management Manual (IPWEA 2015)

20 20

Asset Classification Structure

Used to inform asset data structure and associated reporting, as follows:

• For use by asset management and

information technology practitioners to inform asset hierarchy and/or reporting requirements.

• For use by asset management and

financial management practitioners to inform asset valuation processes.

• For use by financial reporting

practitioners to inform how recognised assets are rolled up for financial reporting.

Function Location Asset Item

Relevant accounting standard terminology > Asset Class, Component and Item

21 21

What’s the problem? National Perspective

• Road Agencies perform similar

functions in the delivery of community services, on asset types that are similar in nature and function.

• National reform initiatives rely on

comparable financial data, sourced from road management organisations (State/Territory Authorities, Local Government Authorities, etc)

22 22

What’s the problem? National Perspective

• The flexibility within AASB standards has led to many different

interpretations; specifically in relation to AAM2102 project scope: − appropriate levels of asset componentisation − terminology within AASB standards (i.e. Asset Class, Component and Item)

• From a whole of state / cross jurisdiction perspective, this lack of

consistency results in a reduction in confidence when comparing financial data and financial statements.

• This has the potential to inhibit effective national reform.

23 23

What’s the problem? Organisation Perspective

A common approach to financial valuation is the use of ‘stereotypes’ which includes:

• Different functional road classifications

having different design standards and therefore different modern day equivalents (good practice)

• Unit rates typically incorporating many

different Asset Types, with different useful lives (questionable practice, as generally not aligned to renewal work practices)

24 24

What’s the problem? Organisation Perspective

Stereotype approaches adopted by many

• rganisations typically group high value Asset

Types (e.g. Pavements) with lower value Asset Types (e.g. minor culverts, signs, etc.)

• This approach is adequate to meet

accounting standard compliance requirements, but

• Does not provide value to asset

management functions, due to lack of transparency.

25 25

What’s the problem? Organisation Perspective

In such circumstances, asset management functions and financial management functions do not align well, resulting in:

• Inefficient organisational costs associated

with data management and

• Lack of ability to leverage financial

valuation data for use in forward planning processes.

26 26

Perspectives

Individual Agency Asset Management requirements Accounting Standard requirements

Asset Management Financial Management Financial Reporting

Cross Agency Consistent Terminology Integrated Asset Management and Financial Management

Single Asset Classification Structure for:

• Asset Management
• Financial Management
• Financial Reporting

Asset Classification Structure – increasing level of inventory data granularity

27 27

Project Goals

Principles used in development of Guidelines: 1. Must comply to Accounting Standards 2. Facilitate better integration of Asset Management and Financial Management 3. Facilitate harmonisation 4. Increase the ease of cross-jurisdictional comparability 5. Reduce barriers for regulatory reform Tasked with developing Prescriptive Guidance Therefore, need to codify how the prescription will apply. Primary focus on:

• Terminology
• Asset Classification Structure
• Item Definition

28 28

What?

How?

10 mins

What?

20 mins

Why?

5 mins

29 29

Project Deliverables

Guideline Research Report Communication Material

30 30

Program Overview – Two year project

Stage 1

• Establish project and team
• Project Inception

Stage 2

• Literature Review

Stage 3

• Current practice Stakeholder Survey

Stage 4

• First Draft Research Report
• Updated First Draft Research Report

Stage 5

• First Draft Guideline
• Updated First Draft Guideline
• Conformance Assessment
• Draft Impact Statement + Gap Analysis
• Second Draft Research Report

Stage 6

• Research Report Final and Guideline Final

Stage 7

• Project Webinar
• Austroads Board Review & Approval

31 31

Project Scope

32 32

What does Prescriptive Guideline cover?

Current Replacement Cost Variables

Componentisation Curves Useful Lives Remaining Useful Lives Gross Replacement Cost unit rates Residual Value unit rates INCLUDED in Prescriptive Guidelines EXCLUDED from Prescriptive Guidelines

Minimum levels of Componentisation to enable improved integration of asset management, financial management and financial reporting

33 33

What does Prescriptive Guideline cover?

Asset Classes

Road Infrastructure Assets Maritime Infrastructure Assets Land and Buildings Plant and Equipment Intangibles INCLUDED in Prescriptive Guidelines EXCLUDED from Prescriptive Guidelines

Asset Types within Road Infrastructure Assets is guided by Austroads Data Standard for Road Management and Investment in Australia and NZ

34 34

Terminology

35 35

Terminology – Literature Review Findings

Accounting Standards

• Asset Class
• Component
• Item

Terminology used across the various documents is significantly different, often with the same terms having different meanings to different jurisdictions. Key Finding: “in principle” guides do not adequately drive consistent application

Description of surfacing Jurisdiction Doc Ref# “Sub-component” NZTA 076 “Sub-class” Queensland 077 “Component” South Australia LG 021

36 36

Alignment of Terminology in Guideline

Asset Class (Level 1) Asset Sub-Class (Level 2) Asset Type (Level 3) Asset Sub-Type (Level 4) Asset Component (Level 5)

Level 1 and Level 2 have direct alignment to ‘Asset Class’ as defined within Accounting Standards Levels, 3, 4 and 5 have direct alignment to ‘Component’ as defined within Accounting Standards

Asset Sub-Component (Level 6)

Level 6 provides detailed componentisation for engineering and asset management purposes An individual Item, within an asset group, may be recognised at Level 2, 3 or 4 subject to the Item Test

Single Asset Classification Structure for:

• Asset Management
• Financial Management
• Financial Reporting

Confirmed that asset accounting concepts of Asset Class and Component are insufficient to fully describe the complex nature of road infrastructure assets.

37 37

Alignment of Terminology in Guideline

Asset Class (Level 1) Asset Sub-Class (Level 2) Asset Type (Level 3) Asset Sub-Type (Level 4) Asset Component (Level 5)

Level 1 and Level 2 have direct alignment to ‘Asset Class’ as defined within Accounting Standards Levels, 3, 4 and 5 have direct alignment to ‘Component’ as defined within Accounting Standards

Asset Sub-Component (Level 6)

Level 6 provides detailed componentisation for engineering and asset management purposes An individual Item, within an asset group, may be recognised at Level 2, 3 or 4 subject to the Item Test

Confirmed that there are different approaches to defining an Item, within the Asset Classification Structure. Floating Item concept. The level which an asset Item is recognised, may differ depending on the Item Definition Approach.

38 38

Stakeholder Engagement

39 39

Stakeholder Groups – Government Split

State/Territory Road Authorities

• NZTA
• TMR QLD
• RMS NSW
• ACT Govt
• VicRoads
• DSG Tas
• DPTI SA
• MRWA
• DoT NT

Federal

• DIRD
• NTC
• CGC

Local Government

• IPWEA
• ALGA
• Individual LGAs via ALGA State

based groups

40 40

Stakeholder Groups – Functional Split

Assets Owners

• State Road Authorities
• Local Governments

Funders

• Treasuries
• DIRD
• Grants Commission

Advisory Associations

• ALGA
• IPWEA
• NTC

Finance / Auditing Industry

• Regulatory
• Standards Boards

Government

• Treasuries
• Auditors General
• Valuers General

Advisory Associations

• Auditor Reference Groups
• State-based industry groups

41 41

Stakeholder Survey Participants

Financial/Audito r 48% Technical/Engineering 52% Number of Verified Respondents: 227

42 42

Do we need a Guideline?

There was very strong support to the need for prescriptive asset componentisation Guidelines

43 43

Research Report

44 44

Research Report Structure

Executive Summary 1. Introduction 2. Methodology 3. Deliverables Overview 4. Literature Review Summary 5. Stakeholder Survey Summary 6. Discussions and Determinations 7. Alignment Assessments 8. Guideline 9. Impact Assessment and Transition Statement

Report provides details which support the Guideline

45 45

Guideline

46 46

Guideline Structure

PART 1 Guideline Overview PART 2 Guideline Application Attachment A Item Test Process Workflow Attachment B Asset Classification Structure Attachment C Item Test Worksheet Attachment D Statement of Conformance Attachment E Hypothetical Case Study

47 47

Key Guideline Outputs

Guideline provides a structured approach to determining, for groups of assets:

• the recommended ‘Item definition approach’, and
• the associated ‘minimum inventory data requirements’

Item definition approach Minimum inventory data requirements Describes recommendation for how a group of assets will be recognised as an Item, including relationship to the levels of the Asset Classification Structure. Options are:

• Average Weighted Asset
• Network Asset
• Simple Asset
• Complex Asset

Describes the minimum level of asset inventory data that should be available to an organisation and that should be expected by an auditor. Options are:

• Desk top assumptions
• Sample data
• Full asset inventory data
• Component level inventory data

48 48

Key Guideline Components (pun intended)

Asset Classification Structure (Appendix B) Gross Replacement Costs Item Test Process Workflow (Appendix A) Table 1 Item Definition Approach Minimum Inventory Data INPUTS METHODS OUTPUTS

49 49

Asset Classification Structure

Refer Appendix B Item recognition level depended on Item Test Component Asset Class Separate identification of the Asset Sub-Classes, in the notes to financial statements

50 50

Gross Replacement Cost Estimates

Asset Class (level 1)

• Road Infrastructure

Asset Sub-Class (level 2)

• Roads
• Roadside
• Drainage
• Mechanical & Electrical
• Structures
• Land Under Roads

Asset Type (level 3)

• As per Austroads Data Standard
• Refer appendix B for details

GRC estimates to be established via reference to existing agency information, such as:

• Previous financial year valuations
• Cost reports for information management

systems

• Analysis of current contract schedules

51 51

Item Test

Item Test can be applied at:

• Level 2: Asset Sub-Class
• Level 3: Asset Type

Item Test is dependent upon:

• % of Gross Replacement Cost (GRC), relative to a group of assets
• As well as three qualifying questions to test:
• Is it practical to apply an average weighted unit rate to the group of assets? (e.g.

Roadside)

• Are Items in Asset Type common? (e.g. Signs)
• Is it practical to split items into Components? (Earthworks)

52 52

Process Workflow and Table 1

Option GRC% Weighted Average Unit Rate Practical? Common Items? Components Practical? Recommended Item Definition Approach (Including Minimum Inventory Data Required) Item Test applied at Asset Sub-Class (level 2) 1 <1% Yes N/A N/A Average Weighted Asset1

• Avg. ‘weighted’ GRC Unit Rate, combining

unit rates for individual Asset Types, applied to a group of assets that make up an Item.

• Concept of modern day equivalent applied,

to describe the typical assets expected within a segment, typically differentiated by functional road classification2.

• If inventory data is not available for the

group of assets, an estimate of assets within a segment, typically by functional road classification2, may be extrapolated from sample data or desk top assumptions. 2 ≥1% to <5% Yes N/A N/A Average Weighted Asset

• Avg. ‘weighted’ GRC Unit Rate, combining

unit rates for individual Asset Types, applied to a group of assets that make up an Item.

• Concept of modern day equivalent applied,

to describe the typical assets expected within a segment, typically differentiated by functional road classification2.

• If inventory data is not available for the

group of assets, an estimate of assets within a segment, typically by functional road classification2, may be extrapolated from sample data.

Refer Appendix A: Item Test Process Workflow

Complimentary methods to put the Item Test into action

• Avg. Weighted GRC

• Avg. Weighted GRC

• Avg. GRC Unit Rate

• n desktop

• Avg. GRC Unit Rate

• n sample data

• n full inventory

Item Definition Approach Minimum inventory data requirements Recognition level within Asset Classification Structure Item Test Financial Reporting Fair Value Calculation

• 1. The adoption of a Weighted Average Asset

• 2. This question is a prompt to establish if

• 3. This question is a prompt to determine if Items

• 4. The Item Test should be applied, up to the point
• f fair value calculation, at least 12 months in

Complete during the year of the next scheduled revaluation cycle

Table 1: Item Definition Approach

and / or

53 53

Item Definition Approach

little or minimal value (group Asset Types) significant value

Benefit

Value

Average Weighted Asset (e.g. Roadside Asset Types) Network Asset (e.g. Signs) Simple Asset (e.g. Culvert) Complex Asset (e.g. Pavement Base & Sub-base)

Complexity

Item Definition Approach determined via Item Test (i.e. GRC% and Qualifying Questions)

54 54

Minimum Inventory Data

Complexity of inventory data required is determined via Item Test. That is:

• GRC% and
• Qualifying Questions

Options are:

• Desk top assumptions

Average Weighted, Network or Simple

• Sample data

Average Weighted, Network or Simple

• Full asset inventory data

Simple Assets

• Component level inventory data

Complex Assets

55 55

Item Test Worksheet

Used to record, by asset group:

• GRC% estimates
• Answers to Item Test

qualifying questions

• Data Gaps identified
• Recommended Item

Definition Approach (Output)

• Minimum Inventory Data

Requirement (Output)

Notes in Item Test Worksheet align to Guideline Process Steps

See Guideline Attachment C

56 56

Key Procedural Requirements

• Attachment B prescribes minimum requirements for level 1 Asset Class, level 2

Asset Sub-Class and level 3 Asset Type.

• Each level of the Asset Classification Structure must have a many to one

relationship with the level immediately above it, as per Attachment B.

• For the purposes of applying the Item Test, the Gross Replacement Cost of the

Road Infrastructure Asset Class (GRCRoad Infrastructure) is to exclude the value of Land Under Roads.

57 57

Key Procedural Requirements

• Implementation of the Guideline includes separate identification of the Asset Sub-

Class categories (as a minimum) in the notes to financial statements.

• An entity may make a decision not to value selected Asset Types
• If they consider the collective value to be highly immaterial and they consider desk top assumptions

related to asset data to provide negligible value to asset management functions.

• Any such decisions will be subject to normal auditing processes to assess the

appropriateness of materiality assessment decisions.

• If an entity decides not to value selected Asset Types, this is to be acknowledged in

the notes to the financial statements.

58 58

How?

What?

20 mins

How?

10 mins

Why?

5 mins

59 59

Project Success

Question: What does success for this project look like?

• Answer: Organisations adopt Guideline as part of next revaluation cycle
• Answer: Organisations adopt Asset Classification Structure for asset

management functions

• Answer: Auditors use Guideline to supplement annual audit of financial

statements

• Answer: Increased consistency* in financial statements allows greater

comparability

* Level 2 categories reported (as a minimum) in the notes to financial statements.

60 60

Implementation

Step Step Description Recommended Timing 1 Apply the Item Test, up to the point of fair value calculation. This should be a relatively quick and easy process, which will assist with organisation specific implementation planning. >12 months in advance of the next scheduled revaluation cycle 2 Consult with internal stakeholders and auditor regarding proposed changes to business processes. 3 Address identified data gaps, including associated information management considerations, and complete fair value calculation. During the year of the next scheduled revaluation cycle 4 Complete financial report and financial statement, including audit.

61 61

Implementation

Leave at least a 12 month lead time, in advance of their next scheduled revaluation cycle

Step Step Description Recommended Timing 1 Apply the Item Test, up to the point of fair value calculation. This should be a relatively quick and easy process, which will assist with organisation specific implementation planning. >12 months in advance of the next scheduled revaluation cycle 2 Consult with internal stakeholders and auditor regarding proposed changes to business processes. 3 Address identified data gaps, including associated information management considerations, and complete fair value calculation. During the year of the next scheduled revaluation cycle 4 Complete financial report and financial statement, including audit.

62 62

Implementation – Step 1

Quick process, to apply the Item Test, up to point of determining recommended:

• Item Definition Approach
• Minimum Inventory Data Requirements

GRC estimates to be established via reference to existing agency information, such as:

• Previous financial year valuations
• Cost reports for information

management systems

• Analysis of current contract schedules

Item Test 12+ months

63 63

Implementation – Base Expectation

• Collaboration required with:

− Asset Manager, Finance Manager and IT Manager. − Auditor (of financial statements)

• Data Gaps identified will require time to address
• Guideline is not a substitute for organisation business processes.
• Implementation is likely to require changes to current business processes.
• Level of impact will depend on the asset management and financial management

practices currently in place for the organisation.

64 64

Potential Impacts

Potential impacts can be grouped into the following categories:

• Depreciation Expense / Asset Portfolio Value
• Financial Reporting & Audit / Compliance Risk
• Revaluation Timing
• Disclosure Requirement
• Asset Management Information Systems
• Cost/Effort Imposition
• Unit Rates / Useful Lives
• Potential to Realise Value to Organisation

See Research Report Section 9 for further details

65 65

Relative Impacts

Level of impact will depend on asset management and financial management practices currently in place for the organisation.

66 66

Disclosure Requirements – AASB 108

• ‘Change in policy’ or ‘Change in estimate’
• Auditor assessment based on merit (i.e. organisation specific determination)
• Anticipate likely outcome to be ‘change in estimate’, for the following reasons:

− Will continue to assess fair value, via current replacement cost methodology − Change in componentisation unlikely to significantly impact the valuation approach − Therefore, unlikely to materially impact the organisation’s financial statements.

67 67

Hypothetical Case Study

Collaborative effort to apply the Item Test (Step 1)

• Joe – Finance
• Jane – Engineering
• Jack – Capital Works
• Jerry – Planning

Outputs:

• Item Test Worksheet (Attachment C)
• Data Gaps

See Guideline Attachment E

68 68

Hypothetical Case Study

Business decisions are required regarding Item definition approach adopted. Examples as follows: Asset Management need results in alternative to recommended Guideline minimum:

• For Road Barriers and Pathways, an asset management need has previously been

identified which triggered collection of a full inventory data set.

• As such, it was decided to treat these two Asset Types as Simple Assets, as
• pposed to the minimum Guideline recommendation of Network Assets.

See Guideline Attachment E

69 69

Hypothetical Case Study

Average Weighted Asset approach may be adopted for multiple Asset Types in an Asset Sub-Class:

• The total estimated GRC% of the Roadside Asset Sub-Class is 5.9%.
• The remaining Asset Types within the Roadside Asset Sub-Class were all relatively

low value, totalling 3.2% when Road Barriers and Pathways are excluded.

• Some of the remaining Asset Types were considered common and some were not.
• Some of the Asset Types has data sets and some did not.
• Notwithstanding these complexities, a balanced decision was made to treat the

Roadside Asset Sub-Class (excluding Road Barriers and Pathways) as an Average Weighted Asset, based on 10% sample data collected across differing functional road classes.

See Guideline Attachment E

70 70

Hypothetical Case Study

Some Asset Types may be broken into Asset Sub-Types:

• Abdul has a structured hierarchy for ITS Assets, with suitable Asset Sub-Types.
• Some ITS Assets Sub-Types already have a full inventory data set.
• He has been requesting funds to complete a data collection program for remaining

Sub-Types, due to technological obsolescence and the need for asset upgrade programs.

• Kick off a 20% sample data collection program for remaining ITS Assets Sub Types,

to support this already identified asset management need.

See Guideline Attachment E

71 71

Hypothetical Case Study

Complex assets need to identify which Components will be adopted:

• Bridges are a Complex Asset.
• Components for valuation purposes will be Superstructure and Substructure,

because renewal program often replaces superstructure and maintains existing substructure (i.e. different useful lives).

• Decision was made not to separately componentise Substructure and Footings, as

per Guideline example, because they have a similar useful life. Rather, footings will be incorporated into the Substructure component.

See Guideline Attachment E

72 72

Hypothetical Case Study

A Network Asset approach may be adopted, in consideration of functional road classifications.

• Treat ‘Open Drains’ and Kerb & Channel’ as a single Asset Type called ‘Roadside

Drainage’.

• Recognise as Network Asset, with a Modern Day Equivalent for each functional road

class.

• Kerb & Channel data recently collected to be supplemented by desk top for Open

Drains.

See Guideline Attachment E

73 73

Hypothetical Case Study

Top Management support Barry – Chief Financial Officer Bob – Executive Director Engineering 12 month implementation plan

• Update of capitalisation and financial valuation business processes
• Mapping of asset management register to finance fixed asset register
• Data collection program (desk top and field based)

Staged approach

• 2019/20 – Roads, Roadside and Drainage Asset Sub-Classes
• 2020/21 – Mechanical & Electrical, Structures and Land Under Roads

More consultation Auditor Works Managers

See Guideline Attachment E

74 74

Benefits – Individual organisations

• Improved data integration
• Increased reporting efficiencies
• Greater transparency and evidence for financial valuation reporting
• Improved availability of financial information to inform forward planning processes
• Greater confidence in financial information to inform performance metrics
• Improved data analytics to inform optimised decision making by top management.

75 75

Benefits – Wider road sector

• Consistent reporting
• Cross organisation knowledge-

sharing

• More equitable reform initiatives.

76 76

Andrew Golding Director Transport System Asset Management Department of Transport and Main Roads P: (07) 3066 0823 or 0407 114 676 E: andrew.c.golding@tmr.qld.gov.au

Questions?

77 77

Upcoming Austroads webinars

Topic Date Guide to Project Delivery Part 5: Road Construction Quality Assurance 20 September Operations of Automated Heavy Vehicles in Remote and Regional Areas 25 September Register at https://austroads.com.au/webinars-and-events

78 78

79 79

Register at http://www.austroads.com.au/event

www.wrcsydney2023.com.au

80

Thank you for participating