The Power of the Funding Module – Part 2: Forecast Parameters

September 30, 2014

The Funding Module allows you to adjust a variety of parameters to tailor the results to your business. For example, changing the inputs for Years and Inflation allows you to see the effects of the inputs on funding. Extending the time period for consideration allows you to see long term funding needs that may not be apparent in shorter sighted reports. All requirements are in current year costs and the inflation option allows you to consider future purchases in amounts adjusted for inflation so that planning that occurs today will reflect future costs and spending, effectively allowing you to do a net present value analysis.

Funding Module - Forecast Parameters

Customize the Analysis

The Forecast Parameters box allows you to change inputs and consider its effects on required funding. You can change the duration of a forecast from 5 to 100 years. Commonly used reporting windows span from 5 to 20 years. By using the inflation rate, customer systems and current open requirements are in current year dollars.

There are a variety of statistical views for the required funding, and users can select the most appropriate Cost Curve for the analysis being performed. “Spiky 0” basically indicates that you want to see actual costs per year. Other curves spread the cost and make assumptions about investments made in previous years.

The Renewal Option allows you to understand your funding needs for deficiencies and deferred maintenance, as well as for systems reaching end of life that need to be replaced or renewed. You can see each independently or combined into a total amount for each year.

Backlog Deterioration is a risk factor that identifies the potential added costs for not addressing issues in the time frame suggested. For example, not taking of the roof could have consequences if there is an issue, where there could be damage to the sub-roofing, insulation, walls, etc.

Finally, you can look at just those capital needs (requirements) that go into the Facility Condition Index (FCI) calculation or all capital needs which are used to calculate the Requirement Index (RI).

The Funding Module is a part of VFA’s facility capital planning software VFA.facility.

Learn more about the Funding Module

Check out Parts 1 and 3 of our Funding Module series: 

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