Depreciation Reports are documents that are designed to assist Strata Corporations and Owners in preparing the financial plan for the complex. For reports to be comparable, they must follow similar standards.

The problem in British Columbia is that there are no set standards for Depreciation Reports. The Appraisal Institute of Canada (AIC) has the most robust Depreciation Report-specific standards, which in turn are based on the Real Estate Institute of Canada (REIC) education course and other disclosure rules of the AIC. The National Reserve Study Standards (NRSS) utilized in the USA are also recognized as a leading document, but no Canadian group enforces compliance. The result is that reports are not comparable in terminology or reporting methodology.

The second issue is that some reports are not prepared in a transparent manner, meaning if a Strata Corporation wishes to use an alternate supplier next time, none or little of the report information may be usable. The result is the next provider cannot provide a discount at a cost-effective price and will have to start the full process again at the full cost. The result is that some Strata Corporations feel bound to go back to the original supplier.

Finally, Depreciation Reports must comply with the Strata Property Act and Regulations for content in the report and minimum funding standards.

Strata Reserve Planning has created a fast review checklist based on a document called CARSS (Commonly Accepted Reserve Study Standards). Our review service aims to allow strata councils to make sure their report covers the Statutory requirements and compliance with AIC, REIC and NRSS standards and indicate areas in a report that may be more transparent.

If you have just received a Depreciation Report, need to know if changes are required before the Draft copy is complete, or want to know where your provider stands, please call us at 604-638-4960.