Capitalisation Shares

Each budget bucket can be controlled with optional capitalisation share settings. The capitalisation shares refer to:

• Renewal - works that improve the condition of the asset
• New - works that result in a new asset
• Upgrade - works that expand the capacity of the asset

When you specify capitalisation shares on a budget bucket, you are controlling how any capital expenditures within the bucket are capitalised against the underlying components. For example:

• If you specify 100% renewal, then all capital expenditures within the bucket will be capitalised as renewals of the underlying components.
• If you specify 100% new, then all capital expenditures within the bucket will be capitalised as new assets.

A single bucket can have multiple capitalisation shares. For example, you can have a bucket with 50% renewal and 50% upgrade. In this case, all capital expenditures within the bucket will be split 50% to renewals and 50% to the improvement of capacity of the same assets.

The total percentage share across the three (3) categories must equal 100%. For example, a project that is 50% Renewal, and 30% Upgrade, must be 20% New; or else have additional weighting directed towards Renewal or Upgrade. In most cases, the Capitalisation Shares will be set to 100% for a single category (such as 100% New), and not split across two or three categories.