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The Assessment of Current Valuation Practices as Applied to Local Authority Infrastructural Assets

Author/s: Sandy Bond, Pornsiri Sakornvanasak

Date Published: 1/01/2006

Published in: Volume 12 - 2006 Issue 1 (pages 38 - 54)

Abstract

This paper outlines the results of a study using two postal surveys to determine the appropriateness and consistency of the valuation methods used in New Zealand by local governments for financial reporting on infrastructural assets. The focus is on those assets which are of a more non-market, public good nature. These assets, which are not commonly traded nor generate a definable income stream, give rise to the more complex valuation issues. The results of the first survey show that progress has been made towards accounting for, and valuation of, local authority infrastructural assets since a prior study by Bond (1996). However, the second survey results reveal that valuation approaches underlying the Optimised Depreciated Replacement Cost (ODRC) method are not being consistently applied.

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Keywords

Infrastructural Assets - Non-Market - Public Accountability - Public Sector Assets - Resource Management

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