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Life Cycle Costing - Principles

Objective. What is it?Why should we do it?When should we do it?What data do we need?. LCC Principles. What?. definition of life cycle costing. Life cycle cost: the cost of an asset, or its parts throughout its life cycle, while fulfilling the performance requirements' (ISO 15686-5)Life cycle c

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Life Cycle Costing - Principles

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    1. Life Cycle Costing - Principles J MARTIN Executive Director, BCIS Edinburgh, 31 May 2011

    2. Objective What is it? Why should we do it? When should we do it? What data do we need?

    3. LCC Principles What?

    4. definition of life cycle costing Life cycle cost: ‘the cost of an asset, or its parts throughout its life cycle, while fulfilling the performance requirements’ (ISO 15686-5) Life cycle costing: ‘methodology for systematic economic evaluation of life cycle costs over a period of analysis as defined in the agreed scope’ (ISO 15686-5)

    5. definition of life cycle costing Life cycle costing is therefore an economic evaluation method that accounts for all relevant costs over the investor’s time horizon adjusting for the time value of money where appropriate

    6. definition of life cycle costing Life Cycle Cost Its about cost to client Exclude Externalities – costs and benefits that accrue to others. Intangibles – ‘costs’ and benefits that have no monetary value. Not to be confused with Life Cycle Analysis (LCA)

    7. Life Cycle Cost and Whole Life Cost

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