ASTM E2279-20

This document is not an ASTM standard and is intended only to provide the user of an ASTM standard an indication of what changes have been made to the previous version. Because
it may not be technically possible to adequately depict all changes accurately, ASTM recommends that users consult prior editions as appropriate. In all cases only the current version
of the standard as published by ASTM is to be considered the official document.
Designation: E2279 − 15 E2279 − 20
Standard Practice for
Establishing the Guiding Principles of Property Asset
Management
This standard is issued under the fixed designation E2279; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope
1.1 This practice covers the creation of a set of guiding principles that, when adopted, is endorsed by top management to be
applied to the practice of property management. These principles will enunciate the objectives and intent of the property (also
known as “asset”) management community, stress simplified procedures, promote less rather than more, judgment rather than
“by-the-book” decisions, and encourage the adoption of “best practices.”
1.2 The acceptance of these guiding principles hasprovides the potential to foster high potential of improved internal controls
and governance. It promotes a problem-solving mentality and culture within the property management community, encourageen-
courages the use of innovative and cost-effective practices, createcreates greater commonality between government and industry
practices, and increaseincreases the ability of organizations to respond to changing needs and business conditions.
1.3 The potential economic and practical This practice adopts the concept that the potential benefits of operating in a manner
consistent with a set of standards and guidelines outweigh concerns about the loss of predictability, uniformity, and consistency.
1.4 The intent of this practice is to provide property management guidance for tangible personal property; however, many of
the principles appropriately apply to other types of property.This practice provides property management standards and guidance
that may be used for various types of property including tangible, intangible, personal, and real.
1.5 This standard does not purport to address all of the safety concerns, if any, associated with its use. It is the responsibility
of the user of this standard to establish appropriate safety, health, and environmental practices and determine the applicability of
regulatory limitations prior to use.
1.6 This international standard was developed in accordance with internationally recognized principles on standardization
established in the Decision on Principles for the Development of International Standards, Guides and Recommendations issued
by the World Trade Organization Technical Barriers to Trade (TBT) Committee.
2. Referenced Documents
2.1 ASTM Standards:
E2131 Practice for Addressing and Reporting Losses of Tangible Property
E2132 Practice for Inventory Verification: Electronic and Physical Inventory of Assets
E2135 Terminology for Property and Asset Management
E2306 Guide for Disposal of Personal Property Assets
E2378 Practice for the Recognition of Impaired or Retired Property Assets
E2452 Practice for Equipment Management Process Maturity (EMPM) Model
E2453 Practice for Estimating the Life-Cycle Cost of Ownership of Property Assets
E2607 Practice for Cannibalization/Reclamation of Serviceable Equipment Components to Support Demand Requirements
E2608 Practice for Equipment Control Matrix (ECM)
E2811 Practice for Management of Low Risk Property (LRP)
E2936 Guide for Contractor Self-Assessment for U.S. Government Asset Management Systems
E3015 Guide for Management of Customer-Owned Property Assets in Possession of Supplier, Contractor or Subcontractor
This practice is under the jurisdiction of ASTM Committee E53 on Asset Management and is the direct responsibility of Subcommittee E53.01 on Process Management.
Current edition approved Jan. 1, 2015July 1, 2020. Published January 2015August 2020. Originally approved in 2003. Last previous edition approved in 20092015 as
E2279 – 09.E2279–15. DOI: 10.1520/E2279-15.10.1520/E2279-20.
For referenced ASTM standards, visit the ASTM website, www.astm.org, or contact ASTM Customer Service at service@astm.org. For Annual Book of ASTM Standards
volume information, refer to the standard’sstandard’s Document Summary page on the ASTM website.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959. United States
E2279 − 20
2.2 Committee of Sponsoring Organizations of the Treadway Commission (COSO):
Internal Control — Integrat​​​​​​​​ed F​r​​amework​​​(the GAO “Green Book” adapted this framework for a government environment)
2.3 Federal Standards:Requirements:
2 CFR 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards
41 CFR Federal Management Regulation
Federal Accounting Standards Advisory Board (FASAB) Statement of Federal Financial Accounting Concepts 1: (FASAB)
Statement of Federal Financial Accounting Concepts 1: Objectives of Federal Financial Reporting
Federal Acquisition RegulationsTitle 48 Federal Acquisition Regulations System
Federal Management Regulations
Public Law 107-217 Codified as “Title 40 of the U.S. Code”
Securities Exchange Act of 1934 Title 15, Section 78m (b)(2)(A)
Securities and Exchange Commission Staff Accounting Bulletin No. 99, Materiality (1999)
2.4 GAO Documents:
GAO-14-704G Standards for Internal Control in the Federal Government (GAO Green Book is based upon COSO’s Internal
Control – Integrated Framework)
GAO-18-568G Government Auditing Standards: 2018 Revision (The GAO Yellow Book)
Title 15, Section 78m (b)(2)(A) (Part of Securities Exchange Act of 1934)
Title 40 of the U.S. Code Public Buildings, Property, and Works
Securities and Exchange Commission Staff Accounting Bulletin No. 99, Materiality (1999)
2.5 Financial Accounting Standards Board (FASB) Documents:
ASC 360 Property, Plant, and Equipment—Prior to recodification guidance contained in FASB 144included FASB 144
Accounting for the Impairment or Disposal of Long-Lived Assets
FASB 144 Accounting for the Impairment or Disposal of Long-Lived Assets
FASB Statement Concepts No. 2FASB Statement Concepts No. 8 Qualitative Characteristics of Accounting Information Con-
ceptual Framework for Financial Reporting
2.6 ISO Standards:
ISO 55000 Asset management — Overview, principles and terminology
ISO 55001 Asset management — Management systems — Requirements
ISO 55002 Asset management — Management systems — Guidelines on the application of ISO 55001
ISO 55010 Asset management — Guidance on the alignment of financial and non-financial functions in asset management
3. Terminology
3.1 Definitions—For definitions relating to property and asset management, refer to Terminology E2135.
3.1.1 acquisition cost, n—purchase price paid for property and any appropriate subsequent improvements to it. Includesit;
includes cash paid or fair value received and material amounts of preparation cost such as inspection, testing, and installation.
3.1.2 agency, n—government organization, regardless of level (federal, state, or local).
3.1.3 alignment, n—deliberate arrangement, relationship, and mutual understanding of common concerns within a particular
activity or among activities.
3.1.4 asset, n—item, thing, or entity that has potential or actual value to an organization; also may be referred to as property,
and asset and property may be used in practice and in documents interchangeably. (For Asset Management purposes.)
3.1.4.1 Discussion—
Value can be tangible or intangible, financial or non-financial (ISO 55000), and includes consideration of risks and liabilities. It
can be positive or negative at different stages of the asset life.
3.1.4.2 Discussion—
Available from American Institute of Certified Public Accountants (AICPA), 1345 Avenue of the Americas, 27th Floor New York, NY 10105, https://www.aicpa.org.
Available from U.S. Government Printing Office Superintendent of Documents, Publishing Office (GPO), 732 N. Capitol St., NW, Mail Stop: SDE, Washington, DC
20401, http://www.access.gpo.gov.http://www.gpo.gov.
Previously known as the Federal Property and Administrative Services Act of 1949.
Available from U. S. Government Accountability Office (GAO), 441 G St., NW, Washington, DC 20548, http://www.gao.gov.
Available from Financial Accounting Standards Board (FASB), 401 Merritt 7, P.O. Box 5116, Norwalk, CT 06856-5116, http://www.fasb.org.
Available from International Organization for Standardization (ISO), ISO Central Secretariat, BIBC II, Chemin de Blandonnet 8, CP 401, 1214 Vernier, Geneva,
Switzerland, http://www.iso.org.
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Physical assets usually refer to equipment, inventory, and properties owned by the organization. Physical assets are the opposite
of intangible assets, which are non-physical assets such as leases, brands, digital assets, use rights, licenses, intellectual property
rights, reputation, or agreements.
3.1.4.3 Discussion—
A grouping of assets referred to as an asset system could also be considered as an asset.
3.1.5 asset, n—assets are probable future economic benefits obtained or controlled by a particular entity as a result of past
transactions or events. (For Financial Accounting reporting purposes. FASB Statement of Financial Accounting Concepts No. 6.)
3.1.6 best value, n—expected outcome of an action, in the entity’sentity’s estimation, which provides the greatest overall benefit.
Federal Acquisition Regulations
3.1.7 care and handling, n—includes the costs of completing, repairing, converting, rehabilitating, operating, preparing,
preserving, protecting, insuring, packing, storing, conserving, and transporting of property, and—in the case of property that is
dangerous to public health, safety, and security—destroying or rendering the property useless for its original purpose.
3.1.8 company, n—a for-profit organization.
3.1.9 condoned, v—a responsible individual “condoned” an act non-compliant with internal controls established by an entity if
the individual knew of the non-compliant act or wrongdoing and did not take required or reasonable steps to prevent or terminate
the action. Adapted from United States Sentencing Commission Eight - Sentencing of
Organizations (2018)
3.1.10 due, n—what is owed others or a right including due care, due diligence, due process, due processes of governance and
operations, undue risk, and what is due in contracts such as acting in good faith and fair dealing.
3.1.11 entity, n—an agency, institution, or organization, or any component thereof.
3.1.12 excess property—property no longer required by the owning agency or entity.
3.1.13 exchange or sale of similar items, n—an arrangement whereby in acquiring personal property, an entity may exchange
or sell similar items and may apply the exchange allowance or proceeds of sale in whole or in part payment for the property
acquired. Adapted from 40 U.S. Code § 503
3.1.14 expendable property, n—items that may be expended, used up in service, also items that may be more easily, safely, and
economically replaced than applying significant efforts and resources to rescue, salvage, maintain, control, or protect.
3.1.14.1 Discussion—
The timing and level of control is circumstantial. Examples in a production environment expendable property may include drill
bits and grinding wheels. As an adjective, able to be sacrificed to achieve an objective, especially a military one.
3.1.15 institution, n—a not-for-profit, nongovernmentalnon-governmental organization. Federal Acquisition Regulations
3.1.16 impairment or impairments, n—is a condition that exists when the carrying amount of a long-lived asset (asset group)
exceeds its fair value. FASB 144FASB ASC 360
3.1.16.1 Discussion—
An impairment loss shall be recognized only if the carrying amount of a long-lived asset (asset group) is not recoverable and
exceeds its fair value. An impairment loss shall be measured as the amount by which the carrying amount of a long-lived asset
(asset group) exceeds itits fair value.
3.1.17 materiality, n—magnitude of an omission or misstatement of accounting data that misleads financial statement readers
or decision makers; materiality is judged both by relative amount and by the nature of the item.
3.1.17.1 Discussion—
Materiality is circumstantiality. Facts omitted or misleading may harm the decision-making process. The U.S. Supreme Court and
Accounting Standards Organization have provided guidance. Small things can make a difference, for example, even a small theft
by the president of a company is material. If an item is material, it should be disclosed in the body of the financial statements or
footnotes (Securities and Exchange Commission Staff Accounting Bulletin).
The definition of the term best value is adapted from Federal Acquisition Regulations, Part 2.1: Definitions of Words and Terms, available online from
http://farsite.hill.af.mil, 13 November 2014.Terms.
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For example, even a small theft by the president of a company is material. If an item is material, it should be disclosed in the
body of the financial statements or footnotes (Securities and Exchange Commission Staff Accounting Bulletin). In determining
whether items or amounts of cost are material or immaterial, the following quantitative and qualitative criteria should be
considered where appropriate but no one criterion is necessarily determinative: (1) the absolute dollar amount involved, (2) the
relationship between a cost item/occurrence and a cost objective, (3) the criticality of an item in terms of importance or use, (4)
the cumulative impact of individually immaterial items, and (5) the cost of administrative processing (Fed-
eral Acquisition Regulations).processing. (Federal Acquisition Regulations)
3.1.18 personal property—property owned or subject to ownership other than real estate, includes items determined to be
non-real estate moveable property.
3.1.19 property management—monitoring and control function charged with assuring that organizational processes related to
the lifecycle management of property support organization objectives represent sound business practice and are compliant with
applicable regulations, contract requirements, standards, and policies.
3.1.20 property management system, n—subset of existing organizational processes related to the lifecycle management of
property.
3.1.20.1 Discussion—
These processes represent sound practice and are compliant with applicable standards, policies, regulations, and contractual
requirements. The property management system may be referred to as a property management business system.
3.1.21 reasonable detail and reasonable assurance, n—that level of detail and assurance as would satisfy a prudent and
knowledgeable asset manager.
Securities Exchange Act of 1934Adapted from Title 15, Section 78m (b)(2)(A)
3.1.22 sensitive items, n—items for which under the conditions, circumstances and regardless of value, there is a reasonable and
worthwhile need for an enhanced level of security, accountability, and control.
3.1.23 surplus personal property, n—any excess personal property not required for the needs an
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