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Classification Circular 3

MAINTENANCE, REPAIR, REHABILATATION, REFRUBISHMENT, UPGRADE AND ADDITION National/Provincial Road shows July/ August 2009. Classification Circular 3 Classification of own account and outsourced Maintenance and Repairs (M&R), Upgrade and Additions (U&A) and Rehabilitation and

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Classification Circular 3

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  1. MAINTENANCE, REPAIR, REHABILATATION, REFRUBISHMENT, UPGRADE AND ADDITIONNational/Provincial Road showsJuly/ August 2009

  2. Classification Circular 3 Classification of own account and outsourced Maintenance and Repairs (M&R), Upgrade and Additions (U&A) and Rehabilitation and Refurbishment (R&R) of all asset types Presented by: SCOA Technical Committee National Treasury

  3. Important principles • Why record asset related payments? • Infrastructure reporting • Asset management and costing • Recording own account transactions • Correctly present spending on contractors • Monitoring total maintenance cost

  4. Definitions • Own Account maintenance, upgrade and rehabilitation • Department engages in project in its own capacity • Outsourced maintenance, upgrade and rehabilitation • Project is outsourced to an external service provider • Only difference is in Item segment

  5. Definitions continued • Maintenance and repairs • Maintaining the capacity and effectiveness of an asset at its designed level • Upgrades and additions • Improving the capacity and effectiveness of an asset above that of the initial design purpose • Rehabilitation and refurbishment • Required due to neglect, unsatisfactory maintenance or degeneration of an asset

  6. Relevant transaction types • Owned and leasehold property • Residential and non-residential buildings either owned or leased by government • To get a full picture of spending on property • Machinery and equipment • All other asset types • Either own account or outsourced

  7. Owned and leasehold property Project Item Asset Maintenance & repair (M&R) Owned & leasehold property: Contracted property M&R Relevant property asset category Projects: Existing infrastructure: M&R Current Upgrade & additions (U&A) Owned & leasehold property: Contracted property U&A Relevant property asset category Projects: Existing infrastructure: U&A Capital Rehab & refurbishment (R&R) Owned & leasehold property: Contracted property R&R Relevant property asset category Projects: Existing infrastructure: R&R Capital

  8. Machinery and equipment Project Item Asset Maintenance & repair (M&R) Contractors: M&R of machinery & equipment Relevant asset category Projects: Not related to infrastructure: M&R Current Upgrade & additions (U&A) Contractors: U&A to machinery & equipment Relevant asset category Projects: Not related to infrastructure: U&A Capital Rehab & refurbishment (R&R) Contractors: R&R of machinery & equipment Relevant asset category Projects: Not related to infrastructure: R&R Capital

  9. Other asset types Project Item Asset Maintenance & repair (M&R) Contractors: M&R of other asset types Relevant other asset category Projects: Existing or not related to Inf: M&R Current Upgrade & additions (U&A) Contractors: U&A to other asset types Relevant other asset category Projects: Existing or not related to Inf: U&A Capital Rehab & refurbishment (R&R) Contractors: R&R of other asset types Relevant other asset category Projects: Existing or not related to Inf: R&R Capital

  10. QUESTIONS? NATIONAL TREASURY SCOA PROJECT TEAM: CALL CENTRE: (012) 315 5311 E-MAIL: SCOA@TREASURY.GOV.ZA WEBSITE: WWW.TREASURY.GOV.ZA External links, SCOA link

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