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Capital Maintenance Expenditure (CapManEx)

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→‎Difference between operational expenditure and capital maintenance

====Difference between operational expenditure and capital maintenance====

When an existing system undergoes minor maintenance, for example regular greasing of bearing points or tightening of pump bolts, the related cost is part of [[Operational and Minor Maintenance Expenditure (OpEx)|operational and minor maintenance expenditure (OpEx)]]. The point where minor maintenance becomes capital maintenance is a matter of frequency; ''does the cost occur more than once a year?'' and of amount; ''Is the cost significant compared to the on-going operational expenditure?''. For example, although the cost of emptying a twin pit or shallow pit-latrine may be significant compared to the initial investment needed for construction, it occurs frequently, at least compared to the life cycle of the latrine itself, and does not constitute a physical renewal. Thus, it is considered as [[Operational and Minor Maintenance Expenditure (OpEx)|operational and minor maintenance expenditure (OpEx)]]. However, the cost of emptying a single deep pit might only be needed once every five to ten years and might usefully be considered as capital maintenance expenditure. The replacement of a small valve on a piped system, or repairing a leaking pipe is [[Operational and Minor Maintenance Expenditure (OpEx)|operational and minor maintenance expenditure (OpEx)]], although its failure can significantly affect the serviceability of the system, because this is a small cost which occurs frequently compared to the life of the system. Replacing a length of pipe because there have been a number of leaks, or replacing a major valve after several years of use would be classified as capital maintenance expenditure.

==Examples==

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