Pro Forma
Tender Specification Template
for
VALUATION SERVICES
INSTRUCTIONS
Open the template and save it as another file name.
Insert your logo into the text box on next page
Use the ‘Replace’ function in Word to search and replace as follows –
Search for
Name of Entity
Replace with
Name of your organisation
Time and date of closing
Tender reference
day and month of year
e.g 5:00pm Friday 22 February 2013
Your internal reference number for the tender
The date of the end of the financial year in day / month format.
E.g. 30 June, 31 March
Day Month Year e.g. 10 May 2013
Day Month Year e.g. 31 August 2013
Day Month e.g. 31 May
Day Month Year e.g. 31 January 2013
date for draft report
date for final report
desktop update due date
date of issue
Review the document and replace words highlighted in red with appropriate responses.
Edit the document as appropriate
Delete these instructions
Re-save the document and issue
-1-
Name of Council – Provision of Valuation Services
Insert Logo
EXAMLE QUOTATION/TENDER SPECIFICATION
Name of Entity
PROVISION OF ASSET VALUATION SERVICES
Name of Quote/Tender:
Provision of Asset Valuation Services
Closing Time:
Time and date of closing
Number:
Tender reference
2
Name of Council – Provision of Valuation Services
1 QUOTATION / TENDER DETAILS
Item
Project Manager
Due Date & Time
Delivery Address
Detail
Name and Contact numbers of project manager
Time and date of closing
Address of Tender Delivery – any special requirements eg: electronic
lodgment only or marked Tender Box, how many copies, etc
3
Name of Council – Provision of Valuation Services
2 SERVICES TO BE PROVIDED
Name of Entity is seeking expressions of interest for the provision of valuation services for a three (3) year period.
Council is required to capture and value its assets and account for them according to accounting standards and
other prescribed requirements to ensure good asset management practices and accurate and reliable accounting
treatment.
The project involves –


The valuation of the following Asset Classes as at day and month of year end each year as follows at Fair
Value (FV). A Comprehensive (Comp) Valuation will involve physical inspection (although a sampling
approach may be utilised as appropriate). A Desktop revaluation (Desk) will not require inspection by the
valuer although updated condition data will be provided by entity to assist the valuer with these
valuations.
Name of Entity also aims to develop a long term strategic relationship with the successful tenderer.
Accordingly the supplier is requested to incorporate into the quote a price for the ad-hoc provision of
general asset accounting and asset valuation.
Some Asset Classes will also require the provision of Insurance values (Ins).
Asset Class
Basis
Land
Buildings
Other Structures
Roads Infrastructure
Water & Sewerage Infrastructure
Parks and Recreational Assets
etc
FV
FV & Ins
FV & Ins
FV
FV
FV
Revaluation
Threshold
$1
$10,000
$2,000
$1
$1
$2,000
2013
2014
2015
Comp
Comp
Comp
Comp
Comp
Comp
Desk
Desk
Desk
Desk
Desk
Desk
Desk
Desk
Desk
Desk
Desk
Desk
The outputs are to include –
Type of Information
Data to be provided
Timing
Details
The key valuation data to be produced from the valuation report include –
Asset Level
 Gross Value (either MV or GCRC)
 Accumulated Depreciation
 Fair Value
Component Level
 Gross Value, Accumulated Depreciation and WDV
 Condition or Consumption Score
 Pattern of Consumption
 Residual Value
 Useful Life & RUL
 Depreciation Rate
 Depreciation Expense
Draft report to be provided by date for draft report
Final report to be provided by date for final report
4
Name of Council – Provision of Valuation Services
Valuation Report and
Certificate
Signed original report setting out the process, results, limitations,
qualification of the valuer, valuation certificate, summary data, etc.
Electronic Valuation Report
To be provided either Microsoft Excel or an electronic database listing each
asset and component, underlying assumptions and results with hyperlinked
photographs, GIS co-ordinates, etc (where appropriate).
The ability for name of entity to access the electronic data and use it to
upload to other systems is critical.
Valuation and Depreciation
Methodology
The valuation is required to be supported by appropriate documentation
setting out the underlying methodology, process and evidenced used to
produce the valuation. This needs to make reference back to the underlying
accounting standards and demonstrate full compliance with all aspects of the
prescribed requirements.
Audit Liaison
The valuer is required to follow up and liaise with the External Auditor or
name of entity with respect to any issues relating to their processes,
methodology and evidence gathered in relation to the valuation. This may
include the provision of source data to the auditor. Any fees associated with
this process are to be included in the overall quoted fee.
5
Name of Council – Provision of Valuation Services
3 BACKGROUND INFORMATION
To assist the valuer gain and understanding the project the following information is provided regarding Name of
Entity.
Type of Information
Type of Entity
Key Contact
Location
(Head Office)
Location of assets
Details
e.g. Local Government
Name and details of key contact
Address and contact details
Provide overview of –
 Types of assets held
 Geographical spread of the assets
 Special instructions regarding access and inspections
Overview of the Business
 Overview of what the entity does
 Types of assets held
 Services provided
 Customer base / community demographics
 Etc
Linkage to other Systems or Provide details of other systems or processes that may impact of the
Processes
delivery of the data and conduct of the valuation. For example –
 Financial Asset Register
 Asset Management System
 Integration into Asset Management Plan
 Existing sources of data condition infomation
A detailed listing of assets will be provided to potential suppliers by contacting contact officer direct via email on
contact office email address.
Or
Detailed listings of the assets to be valued are included in the attached Excel spreadsheets.
However the following information is provided for quick analysis.
Asset Class
Land
Buildings
Other Structures
Roads Infrastructure
Water & Sewerage Infrastructure
Parks and Recreational Assets
etc
No.
Assets
3,000
600
350
25,400
32,300
890
Valuation
Basis
MV & DCRC
MV & DCRC
DCRC
DCRC
DCRC
DCRC
Last
Comp.
2009
2009
2009
2009
2009
2009
Current
WDV
56 million
67 million
45 million
470 million
370 million
8 million
6
Name of Council – Provision of Valuation Services
4 DEFINITIONS & PRESCRIBED REQUIREMENTS
The valuation is required to comply with all aspects of the relevant accounting standards and other Prescribed
Requirements. These include (but are not limited to) –
AASB
AASB13
AASB116
AASB136
AASB5
AASB140
AASB123
Accounting Standard
Fair Value
Property, Plant and Equipment
Impairment
Assets Held for Sale
Investment Properties
Borrowing Costs
List jurisdiction specific requirements (eg. Treasury Policies)
For the purposes of the exercise the following definitions apply.
Active Market
A market in which all the following conditions exist:
(a) the items traded within the market are homogeneous;
(b) willing buyers and sellers can normally be found at any time; and
(c) prices are available to the public
Component
A significant part of a complex asset which has a different useful life or
pattern of consumption from the other significant parts.
Comprehensive
Valuation
A revaluation which entails significant levels of physical inspection and
evaluation of all appropriate aspects such as methodology,
assumptions and Unit Rates.
Depreciable Amount
The cost of an asset, or other amount substituted for cost, less its
residual value.
Depreciated Current
Replacement Cost
The Gross Replacement Cost less any Accumulated Depreciated. It
reflects the level of remaining service potential embodied in an asset
based on the current replacement cost.
Depreciation
The systematic allocation of the depreciable amount of an asset over
its useful life which reflects the pattern in which the asset’s future
economic benefits are expected to be consumed by the entity
Fair Value
The amount for which an asset could be exchanged between
knowledgeable, willing parties in an arm’s length transaction.
Or
The price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the
measurement date (an exit price).
7
Name of Council – Provision of Valuation Services
GCRC
Gross Current
Replacement Cost
The cost of replacing the total potential future economic benefit of the
existing asset using either reproduction or modern equivalents after
taking into account any differences in the utility of the existing asset
and the modern equivalent.
Interim Revaluation by
Indexation
Also referred to as a Desktop Valuation. This type of valuation is
based purely on indexation rates and adjustments for additions,
deletions and changes in condition (e.g. impairment). It should be
limited to a maximum of two or three years between comprehensive
valuations.
Market Value
The price that would be exchanged between a willing buyer and seller
in an open and liquid market.
Pattern of Consumption
The pattern in which the asset’s future economic benefits are
expected to be consumed by the entity. This may be constant,
increasing, decreasing or variable.
Residual Value
The estimated amount that an entity would currently obtain from
disposal of the asset, after deducting the estimated costs of disposal, if
the asset were already of the age and in the condition expected at the
end of its useful life
RUL
Remaining Useful Life
The time remaining until an asset ceases to provide the required level
of service or reaches the end of its economic usefulness.
Useful Life
The period over which an asset is expected to be available for use by
an entity; or the number of production or similar units expected to be
obtained from the asset by an entity.
8
Name of Council – Provision of Valuation Services
5 SPECIFIC REQUIREMENTS OF THE CONTRACT
1. Comprehensive Valuation
a) All assets to be re-valued at Fair Value in full compliance with the requirements of the prescribed
requirements and relevant guides as listed the “Services to be Provided” section.
b) This includes valuing each asset as appropriate using either the Market Value, Income or the Depreciated
Current Replacement Cost basis. With respect to the Depreciated Current Replacement Cost basis this
includes  Identification of all costs
 Splitting complex assets into components (all assets above revaluation threshold)
 Determining “Gross Current Replacement Cost” cost for each component
 Adjusting for the differences in service potential between existing asset and modern equivalent
or reference asset
 Determination of remaining service potential based on condition, obsolescence, the entity’s asset
management strategies and other relevant factors.
c) The term ‘fair value’ is defined as being ‘the amount for which an asset could be exchanged, or a liability
settled, between knowledgeable, willing parties in an arm’s length transaction’. This is not necessarily the
market selling price of the asset. Rather it should be regarded as the maximum value that agency
management would rationally pay to acquire the asset if it did not currently hold it, taking into account:



The cost of replacing or reproducing the asset, if management intend to replace the asset;
The remaining useful life and condition of the asset; and
Cash flows from future use and disposal.
d) Fair Value will be determined as follows –
 Where this is an active and liquid market – Market Value
 Where there is other evidence of market value – Net Present Value or Depreciated Current
Replacement Cost
 Where there is no evidence of market value – Depreciated Current Replacement Cost
e) Where appropriate, complex assets are to be componentised in accordance with the requirements of the
accounting standards at a level that enables determination of depreciation for each component as well as
integration into the entity’s Asset Management Framework.
f)
All valuations are to be completed with an effective date of day and month of year end each year.
g) All valuations are to supported by sufficient and appropriate audit evidence to enable our auditors to
satisfy their professional requirements
h) Where indicated, insurance Valuations are also to be provided for each asset. In determining the
insurance valuation adequate allowances will be made for:
 Cost increases during the rebuilding period;
 Cost of demolition and removal of debris;
 Cost of all relevant professional fees including, but not limited to, architects, engineers, solicitors,
surveyors and planning consultants;
 Any foreseeable associated or incidental costs; and
 Any additional costs due to planning restrictions or due to changes in regulations relating to fire,
flood and Occupational Health and Safety legislation.
9
Name of Council – Provision of Valuation Services
2. Annual desktop re-valuations
a) Updates will be required by desktop update due date each year to enable the timely completion of
financial statements.
b) Documentation and supporting information to support the valuation are to be provided.
3. Provision of general asset accounting and asset management advice
a) Provide an hourly rate for ad-hoc asset accounting and asset valuation advice (phone and email support).
b) Provide an hourly and daily rate for face to face meetings, workshops or the production of detailed
written reports or research as required.
10
Name of Council – Provision of Valuation Services
6 EVALUATION CRITERIA
In addition to price, the evaluation criteria include a range of mandatory and qualitative criteria.
The criteria and their respective weightings are as follows. Please ensure you proposal specifically addresses each
criteria.
Criteria
1
2
3
4
5
6
7
8
Type
Meets timeframe
Insurance Coverage
Methodology (including full compliance and timeframe)
Relevant Skills
Relevant Experience
Track Record
Ability and Willingness to add value
Quality Assurance
Weighting
Yes/No
Yes/No
40%
20%
15%
15%
5%
5%
100%
If a supplier is unable to satisfy all criteria they may be eliminated from the tender process. However they may
still submit an Alternative Tender. If so they must 

detail the reason for non-compliance
set out an alternative strategy for consideration by the evaluation panel.
The non-price criteria are described as follows.
Criteria 1: Meets timeframe
The specification requires the draft to be delivered by date for draft report with the final report to be delivered
by date for final report.
The response for this criteria is either Yes or No.
Criteria 2: Insurance Coverage
The following Insurances are required. Please provide the following information and indicate whether you satisfy
the minimum requirements with a Yes or No.
Insurance
Public Liability
Professional Indemnity
Workers Compensation
Amount Required
$10 million
$5 million
For each Policy please advise –






Amount of coverage held
Name of Insurer
Policy Number
Expiry Date
Excess
Whether you satisfy the minimum requirements (Yes or No)
11
Name of Council – Provision of Valuation Services
Criteria 3: Methodology (including full compliance and timeframe)
Proposals should include a discussion of the valuation methodology to be used and the proposed process to be
followed.
Examples of data collection forms and all other relevant material to be used including a sample of the output
should be tendered as part of your proposal.
Examples of the proposed reporting format should be included as part of the fee proposal.
It is critical that this section addresses the items identified in “Services to be Provided” and “Specific
Requirements of the Contract” sections.
Criteria 4: Relevant Skills
Proposals should include Curriculum Vitae detailing relevant qualifications and expertise for all team members
including sub-contractors. Where sub-contractors are used, your quotation should clearly identify that part of the
project to be undertaken by the sub-contractors.
Criteria 5: Relevant Experience
Proposal should outline your experience and reputation with respect to




the valuation of these types of assets
this sector
provision of advice, consulting and training with respect to asset accounting and asset valuation
contributions (of a professional or technical nature) made for the benefit of the sector as whole
In particular the proposal should also outline details of any other relevant experience or expertise that may be
relevant or provide the potential to add extra value to name of entity as a consequence of being awarded this
contract.
Criteria 6: Track Record
Proposals should provide details of their track record in successfully completing projects of this nature.
In particular provide details of –




the number of these type of valuations completed over the past 3 years
details of whether qualified audits resulted due to asset/depreciation/valuation problems.
contact details for referees
relevant information that provides and indicator of actual performance
12
Name of Council – Provision of Valuation Services
Criteria 7: Ability and Willingness to add value
The values of assets held by name of entity are significant and due to their impact across the various services
delivered by the entity it is desirable to build a long term strategic relationship that provides name of entity with
added value.
Proposals are to include information which will provide an indication of the potential to develop such a
relationship. In particular they should provide information about 



The ability and desire to establish long term relationship with Council
Contributing to the development of better practices across the sector or within specific entities with
particular focus on asset accounting, asset valuation, asset management and corporate governance.
Your ability to deliver all services in house
relevant information that provides and indicator of actual performance
Criteria 8: Quality Assurance
Proposals should indicate the processes they have in place to ensure a high level of quality assurance.
Entities with Independent Third Party ISO:9001 “Quality Management” will be afforded full marks.
7 PRICING SCHEDULE
All costs are to be quoted as a fixed price (inclusive of travel, ancillary and tax costs) using the following schedule.
Activity
Rate
Valuation of Assets
Total
Provision of Ad-Hoc Advice
(email and phone support)
Provision of Ad-Hoc Advice
(meetings, workshops, detailed reports and
research)
Price
(inclusive of travel,
ancillary costs and tax)
Per Hour
Per Hour
Per Day
Date Issued: date of issue
13