Infrastructure assets are long-lasting capital assets that add value to land and tend to be part of a larger system. Some common types of infrastructure assets are bridges, dams, tunnels, streets, sidewalks, water mains, and lighting systems. Infrastructure assets are accounted for under capital assets as either non-depreciable, depreciable or both. The approach for reporting infrastructure assets can vary from one government to another, as allowed by accounting standards. Infrastructure assets can be reported using the following approaches:
- Traditional Depreciation Approach - Infrastructure assets are depreciated consistently with all other depreciable capital assets. In this approach, infrastructure assets are listed under depreciable capital assets.
- Modified Approach - A method of accounting for qualifying infrastructure assets in which maintenance and preservation expenses are reported as expenses and depreciation expense is not required. Infrastructure assets qualify for this method of accounting when management has an asset management system in place and has committed to maintain or preserve the infrastructure network or subsystem approximately at or above a specific condition level. In this approach, infrastructure assets would be listed under non-depreciable capital assets.
- Combined Approach - The combined approach is when a government uses the traditional depreciation approach for some infrastructure assets and uses the modified approach for infrastructure assets that are in networks or subsystems. For example, a government may use the modified approach on a specific subsystem, such as the street pavement system, and the traditional approach for all other infrastructure assets. Using this approach, infrastructure assets are listed under both non-depreciable and depreciable capital assets.
In the Financial Detail Screen of CreditScope under the sub-category "General", there is a line item entitled "Infrastructure Accounting Basis." The infrastructure accounting approaches are displayed for each period of the government only when the government does not use the traditional approach. The Infrastructure Accounting Basis is found in the City, County, Land District, School District, Special District, and State Financial Detail Screens.