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Infrastructure &
Finance Division

Guide to the Amortization of Tangible Capital Assets


Circular No. 08:15
ARCS File#: 195-20


May 13, 2008
To: All Municipal and Regional District Financial Administrators
Re: Guide to the Amortization of Tangible Capital Assets

A key role of British Columbia’s local governments and their Council or Board is providing services such as water supply, sewage treatment, parks and roads. The delivery of each of these services usually requires the acquisition and maintenance of tangible capital assets. There has been a recent change in the accounting and reporting requirements for tangible capital assets, which will impact all local governments in British Columbia in their stewardship of these important assets.

There are three major steps for implementing PS 3150, the accounting standard 3150 brought into effect by the Public Sector Accounting Board (PSAB).

  1. Inventory;
  2. Valuation; and
  3. Amortization.

Before valuation and amortization can be determined, it is necessary to determine the useful lives of tangible capital assets. The attached document is intended to provide guidance on determining useful lives of assets to enable step 3, the amortization of local government tangible capital assets. The information in the tables is based on extensive internal discussion, research and consultation with a range of sources regarding the useful lives of tangible capital assets.

It is strongly suggested that local governments use this information as a guide to determining the useful lives over which tangible capital assets will be amortized, unless they receive professional advice to the contrary. A local government may wish to discuss decisions about amortization with their auditor.

Original signed by:
Talitha Soldera, CGA
Local Government Infrastructure and Finance

Attachment (304 KB)

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