Asset Management Terminology

There are many acronyms and specialised terms used in the Asset Management arena. Some terms are well defined and others are not.

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Breakdown Maintenance - Breakdown Maintenance is maintenance that is performed on an asset after it has failed.

Brownfields Valuation - A Brownfields Valuation is a valuation of an asset that takes into account the cost associated with; existing underground services, adjacent buildings or other similar constraints when calculating the replacement cost of the asset.

Capital Expenditure - Capital Expenditure (CAPEX) is expenditure that creates an asset or that increases an existing asset's remaining useful life (RUL).

Capital Upgrade - A Capital Upgrade is any project (including a land purchase) that extends or upgrades and asset to cater for growth or additional service levels.

Capital Works Evaluation Framework - A Capital Works Evaluation Framework is a system used to assist in prioritising projects for consideration within an organisation's Capital Works Program.

Community Service Level - A community service level / community level of service is a service level that specifies the level of service that is to be provided to the community.

Component - A component is a part of an asset that for any reason needs to be identified separately from its parent asset. Reasons may include a different useful life or maintenance regime.

Component Checklist - A Component Checklist is a list of component types that could be part of a typical asset of a particular asset type.

Composite Asset - A composite asset is an asset necessarily assembled from or compromised of assemblages and/or components.

Condition Assessment Manual - A Condition Assessment Manual (also Condition Rating Assessment Manual) is a document that specifies how asset condition inspections on a particular class of asset should be carried out, and how to determine the appropriate condition score for a given asset.

Condition Based Maintenance - Condition Based Maintenance is a maintenance technique that involves monitoring the condition of an asset and using that information to predict its failure.

Condition-Based Depreciation - Condition-Based Depreciation is the determination of accumulated depreciation as the cost in any reporting period of restoring an asset's gross service potential, based on the condition of the asset within the period. Changes from year to year in cumulative depreciation so determined represent the annual depreciation.

Contributed Asset - Contributed Asset -> Donated Asset

Core Asset Management - Core Asset Management is Asset Management which relies primarily on the use of an asset register, maintenance management systems, job/resource management, inventory control, condition assessment, simple risk assessment and defined levels of service in order to establish alternative treatment options and long-term cashflow predictions. Priorities are usually established on the basis of financial return gained by carrying out the work (rather than detailed risk analysis and optimised decision making).

Core Asset Management Plan - A Core Asset Management Plan is an asset management plan that complies with the minimum legislative requirements for an asset management plan, and contains core asset management information.

Corrective Maintenance - Corrective maintenance is maintenance carried out after a failure has occurred, and intended to restore an item to a state in which it can perform its required function. (This may include breakdown or reactive maintenance)

Cost of Failure - The cost of failure of an asset may be:

  • environmental
  • social
  • operational
  • economic

Creation/Acquisition Plan - A Creation/Acquisition Plan is a document that defines how an organisation decides when new assets need to be created and existing assets need to be upgraded, the projected cost of these works and the standards applicable to them. Construction/Acquisition Plans are often a section within an Asset Management Plan.

Critical Asset - A critical asset is an asset for which the financial, business or service level consequences of failure are sufficiently severe to justify proactive inspection and rehabilitation. Critical assets have a lower threshold for action than non-critical assets.

External Links & References

  1. DERM
  2. Queensland Department of Local Government, Sport & Recreation Glossary of Terms
  3. Wingecarribee Shire Asset Management Terminology
  4. Institute of Asset Management Definitions Page
  5. City of Joondalup Works Category Definitions
  6. Asset Management Series Glossary
  7. South Australian Road Traffic Act Definitions
  8. Wealth of Opportunities Glossary
  9. Google Search
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