Enhancing correlation between pavement consumption and deterioration with financial depreciation

This research aims to advance the understanding of the correlation between pavement deterioration calculated using engineering modelling and financial depreciation calculated in accordance with IFRS. A case study has been undertaken in a local government authority to assess the measurement and reporting of pavement consumption using engineering based information and the use of this in the annual report. Depreciation accounts for approximately 25% of the operating costs of local government but is a non-cash item, making it a major focus of attention. Governments have increased the reporting of key performance indicators such as an asset sustainability index, with roads comprising a major part. The study shows that the calculation of financial depreciation is dependent on the reporting goals of the authority and measurement techniques used in valuing and maintaining road pavements. In addition the KPI’s are misleading as the definitions and reporting criteria used are open to interpretation and dependent on the accounting policies selected.


  • English

Media Info

  • Pagination: 10p
  • Monograph Title: Transport Research Arena (TRA) 2014 Proceedings

Subject/Index Terms

Filing Info

  • Accession Number: 01534673
  • Record Type: Publication
  • Source Agency: ARRB
  • Files: VTI, TRIS, ATRI
  • Created Date: Aug 14 2014 10:18AM