Asset Componentisation

Asset Componentisation is the process/practice of (notionally) breaking up complex assets into parts with similar useful lives.

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Image: Steven Leckart

Thoughtful componentisation, should make it easier to manage the accounting aspects of asset renewal, and may reduce the amount of residual value that needs to be assigned to complex assets.

Roads

Roads are typically broken up into at least three components, namely:

Sewage Pump Stations

An active asset such as a sewage pump station may need to be broken up into many different components. Bundaberg Regional Council for example breaks its pump stations up into the following components:

  • Flowmeter
  • Motor Starter
  • Odour Control
  • Pipework and Valves
  • Pump Stool
  • Slide Rail
  • Pump Well Structure
  • SCADA RTU Installation
  • Submersible Pump
  • Switchboard
  • Dry Well Submersible Pump
  • Line Shaft
  • Electric Motor
  • Ventilation Fan
  • Verticle Split Casing Pump

Stormwater Pipes

Stormwater pipes are typically not componentised (pits are usually considered to be a separate asset to the pipe), but where an existing concrete pipe is given an in-situ lining, the lining may be treated as a separate component.

Related Pages

External Links & References

  1. Google Search
  2. Fair Value Pro
  3. ACCA
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