ABSTRACT
Asset valuation as a major component of asset management is increasingly becoming an issue for municipal managers. With alternative management strategies such as privatisation, fixed term operation and transfer of ownership being more widely used, non-technical managers require a means of determining the capital value of assets under negotiation. Financial accounting guidelines have been developed and adopted to guide public agencies in the reporting of public assets. These methodologies generally lack the performance component and may not accurately represent the true “worth” of the asset, particularly as far as the owner is concerned.
This paper outlines the development of a methodology to determine asset value of municipal infrastructure assets through the integration of monetary valuation methodologies and performance parameters to provide a representative asset performance value. The outcome will provide municipal stakeholders (decision-makers, politicians and the public) with a true representation of the municipal asset value and a tool to assist communication and decision making.
