Choosing the useful life of model data
Summary
The useful life is the number of years you expect to keep using the model data. In the report you choose it from a list that runs from 5 years up to 30 years for buildings and up to 50 years for infrastructure. It starts at 20 years.
The choice matters in two places. On the Valuation page it sets the period over which the data is amortised if you recognise it as an asset, so it changes the yearly amortisation and the carrying amount. On the Savings page it sets how many years of operate & maintain savings are counted. It is one setting: change it on either page and the whole report follows.
Pick a life you can explain to your auditor. The life of the building or bridge is an upper limit. The life of the data also depends on how long its format stays readable and whether anyone keeps it up to date.
Where you set it in the report
The same selector appears in several places, and they all show the same value:
| Page | Where |
|---|---|
| Valuation | Useful life at the top of the page The data value ladder, with the hint buildings: up to 30 years; also set on the Savings page (or infrastructure: up to 50 years). |
| Savings | Useful life at the top of the page Potential savings in operate & maintain costs. |
| Overview | Useful life in the Potential savings card. |
The choice is remembered for that file in your browser tab, so you can move between pages and reload without losing it. A standalone copy of the report starts on the useful life you had chosen.
The options and the default
| Asset | Options | Starts at |
|---|---|---|
| Buildings | 5, 10, 15, 20, 25 or 30 years | 20 years |
| Infrastructure | 5, 10, 15, 20, 25, 30, 40 or 50 years | 20 years |
Which list you get follows how the report treats the asset for operate & maintain savings. The subtitle of the Savings card says Building or Infrastructure. Bridges, roads, rail and tunnels are maintained on a long, steady cycle, so their list goes further.
The default of 20 years is only where the selector starts. Change it to the life you would defend in your own accounts.
What the useful life changes in the report
| Where | Figures that follow the useful life |
|---|---|
| Recognising this data as an asset (Valuation) | Carrying amount if recognised, amortised over the years you chose. |
| Data value ladder (Valuation) | Value in use, and the figures on the ladder that build on it, such as the recoverable amount used in the impairment test. |
| Savings | Value in use today, the average yearly saving and the totals over the life, and the chart Savings over N years. |
| Overview | The Potential savings card: savings potential over the chosen years, value in use today and the carrying amount. |
The carrying amount on the recognition card is amortised straight-line from the export date over the useful life you choose. A longer life spreads the same cost over more years. The yearly amortisation is lower and the book value falls more slowly. A shorter life does the opposite.
On the Savings page a longer life counts more years of operate & maintain work, so the totals grow. That does not make the data worth more on the balance sheet. The carrying amount still starts from cost and is written down when the recoverable amount is lower, as explained in Why BIM data is worth less on the balance sheet. How the savings are built up is described in Operate & maintain savings.
Use one life for both purposes. Showing savings over 50 years while amortising over 10 is hard to explain to a board or an auditor.
The accounting context
Model data that you recognise is an intangible asset. The recognition card names the standards: IAS 38 and its national equivalents, such as HGB, RJ 210, FRS 102, J-GAAP, CAS 6 and AASB 138; GASB 51 for US public owners. They agree on the basics.
- An intangible asset with a finite useful life is amortised over the period the owner expects to use it. Under IAS 38 straight-line amortisation is the fallback when the pattern of use cannot be determined reliably.
- The useful life is an estimate, and IAS 38 requires it to be reviewed at least at each financial year end. If your expectations change, the remaining book value is spread over the new remaining life from then on.
- Some national rules set a ceiling. Under HGB in Germany and FRS 102 in the UK the period is ten years when the life cannot be estimated reliably, Italy uses five years in that case, and Spain presumes five years at most. The country table in Why BIM data is worth less on the balance sheet lists them.
- US state and local governments follow GASB 51. An intangible asset with a limited useful life is amortised over that life, and where a contract or other legal right limits how long the asset can be used, the life may not be longer.
The useful life of the data is its own estimate. It may be shorter than the life of the structure, and it cannot sensibly be longer.
Making the choice supportable
An auditor will ask why you expect to use the data for the years you chose. These are the arguments that carry weight, and the evidence to keep for each:
| Argument | Evidence |
|---|---|
| The asset's maintenance cycle | The asset management plan. Data used for planned maintenance, inspections and replacements stays in use as long as that plan runs. A major renovation that replaces most of the model is a natural end point. |
| The format stays readable | The data is held in IFC. IFC is an open standard (ISO 16739) that any software can read without a vendor's permission, which supports a longer life. Data that only opens in one vendor's software can lose its use when that software changes. See Why forensicBIM works with IFC. |
| Someone keeps the data current | A yearly budget and a named owner for updating the model after alterations and replacements. The report notes that keeping the data up to date is an expense, not a new asset. Data nobody maintains goes out of date and has to be written down. |
| Contracts and licences | Any term in the delivery contract or a licence that limits how long you may use the data. |
| Consistency | The life you use for similar intangible assets, such as asset management software or survey data. |
File the audit report, with its date, alongside the reasoning. The recognition card asks for the same: keep the evidence so your auditor can trace the figure.
Shorter or longer?
A shorter life is the cautious choice when the data is incomplete, when no budget exists to maintain it, or when you expect a renovation or replacement of the main systems within a few years. A longer life is easier to defend for a structure with a long, predictable maintenance regime, data held in IFC, and an owner who updates the model as the asset changes. The balance sheet article notes lives of often 20 to 30 years for buildings and up to 50 for infrastructure. Treat them as upper ranges for well-kept data.
A higher carrying amount comes from a better-supported cost and better data, not from a longer life. 4 ways to raise the balance sheet value of your BIM data rates the options and shows which ones hold up.
Frequently asked questions
Does a longer useful life make my data worth more?
It raises the savings totals and lowers the yearly amortisation. It does not raise the cost the data is recognised at, and each year the book value is still tested against the recoverable amount.
Why can I not choose more than 30 years for a building?
The report keeps the choice within the range that can usually be supported: up to 30 years for buildings and up to 50 for infrastructure. Building finishes, equipment and layouts change well within the life of the structure, and the data describing them ages with them. If you expect to use building data for longer, choose 30 years in the report and discuss the longer period with your auditor.
Do I need to set the life on both pages?
No. It is one setting. Changing it on the Valuation page or the Savings page updates both, and the Overview.
Can I change the useful life later?
In the report, at any time. In your accounts, the life is reviewed at least once a year, and a change applies from then on. Discuss it with your auditor first.