Encl. (2) TO COMDTINST 4610.6
Catalog. These costs are usually less than open market prices due to the volume of
purchases. If, for some unusual reason, value is unknown or there is doubt concerning the
preshipment value of an item lost or damaged, consult the item manager (IM). The IM
determines value based on consideration of original cost, its utility and use, condition and
age, and extent, if any, to which it has deteriorated or depreciated. If, however, there is a
continuing need for a like or similar item, and there are none available in the supply
system, the value may be the estimated cost to reproduce or replace the item (including
transportation cost) less allowances for preshipment condition of the property lost or
irreparably damaged. Sometimes, lost or damaged property has no value other than as
scrap. The property may be obsolete or have been shipped for disposal through the
established property disposal channels. If the property has no value other than as scrap,
that value will represent the measure of loss.
c.
Depreciation of Property. Many items of government property, although classed as
serviceable (material condition code A), are actually depreciated in value at time of
shipment from one site to another. When used property is lost, irreparably damaged, or
damaged beyond economical repair, the question of depreciation must always be
considered when determining the amount of the government's actual loss. For property in
preshipment reparable condition, both depreciation allowance and average standard cost of
repair may apply for computation of the actual loss. When there is a continuing need for
an item and it must be replaced, the amount of loss is based on the adjusted replacement
cost. Obtain it by deducting the depreciation applicable to the used item from the cost of a
new like item. For property which will not be replaced, the amount of loss is determined
by deducting the depreciation allowance from the original cost or the Federal Supply
Catalog quotation or DLA Consolidated Management Data List under which the property
was carried in the United States Coast Guard inventory. Usually, a depreciation rate is
based on the service-life expectancy of an item of property. These rates should be
maintained by the IM of the class of property involved. When a depreciation allowance
applies, the transportation officer requests it from the IM. Depreciation allowances based
on the technical knowledge of the IM will establish a sound basis for an
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