Depreciation Report vs Reserve Study: The Same Thing?

The short answer

They are the same kind of document. A depreciation report is what British Columbia calls it, a reserve fund study is the usual term in Ontario, and a reserve study is the standard term in the United States. All three are long range funding plans for the things an association owns in common.

What differs is not the concept but the rules attached: who must have one, how often, who may prepare it, and what it must contain. Those are set locally, and they are the reason you cannot take a template from one jurisdiction and assume it satisfies another.

• British Columbia: depreciation report, with a 30 year timeline and at least three funding models
• Ontario: reserve fund study, with its own cycle and content rules under provincial law
• United States: reserve study, with requirements that vary considerably by state
• All of them: a component list, remaining life, replacement cost and a funding plan

If you are in BC and working to the 2026 or 2027 deadline, the specifics are in BC strata depreciation reports.

What every version of the document contains

Underneath the terminology, the work is the same four steps, and knowing them helps you judge whether a quote is for a serious piece of work or a thin one.

1. Inventory: list the components the association is responsible for replacing
2. Condition and life: assess each one and estimate how long it has left
3. Cost: estimate what replacement will cost, in future dollars
4. Funding: model contributions over time so the money is there when each item fails

Step one decides the quality of everything after it. A component missing from the inventory is a cost missing from the plan, and the most commonly missed items are the unglamorous ones: drainage, retaining walls, elevator controllers, building envelope sealant, parking membranes. Walk the property with the inventory in hand and look for what is not on it.

Step three is where two reports on the same building can differ by a lot. Ask which inflation assumption was used and whether costs are current or future dollars. A plan built on an optimistic inflation figure looks affordable and fails quietly.

Where they genuinely differ

How often you need one

Update cycles are set locally. British Columbia requires an update at least every five years once the first report is in place. Other jurisdictions set their own intervals, and some set none at all for smaller associations. Do not assume your neighbour's cycle is yours.

Who may prepare it

This is the sharpest difference. British Columbia now restricts preparation to a defined list of qualified professionals. Elsewhere, the field can be more open, and in some places a board can produce something in-house. A document prepared by someone outside the permitted list may not satisfy the requirement however good it is.

Whether the funding plan is advisory or expected

Some jurisdictions require only that the study exists. Others expect contributions to follow a plan. Either way, a board that receives a study and changes nothing has taken on a risk it should record in the minutes, with reasons.

What to ask for when you commission one

• Name the jurisdiction in the request, and ask the provider to confirm the report will meet its requirements
• Ask which designation the person signing the report holds
• Ask whether the fee includes an on-site visual inspection, and how long it will take
• Ask how many funding models you will receive and whether a recommendation is included
• Ask for the component inventory as data you can reuse, not only as a PDF
• Ask what the update will cost in five years, so the cycle is budgeted rather than rediscovered

The fifth point is worth insisting on. The inventory is the asset register of your building, and getting it back as a spreadsheet means next year's budget, your maintenance plan and your next update all start from it. Getting it back only as a PDF means somebody retypes it, or more likely does not.

Price varies with the size and complexity of the property, and with how much of the history you can hand over. For what moves it, see what a reserve study costs.

Using the document after you have it

The most common failure is not a bad report. It is a good report that nobody turns into a decision. The document arrives, it is long, the council files it, and the contribution stays where it was.

1. Put the funding decision on a meeting agenda as its own item
2. Pick one model and record why, including what risk the council is accepting
3. Set the contribution for the coming year from that model
4. Load the component schedule into your budget so next year starts from it
5. Diarise the update date now, five years out, with the budget line to match

Step four is what makes the next few years easier: the schedule becomes the backbone of the annual budget instead of a document people remember existing. A reasonable place to put those figures while the report is still fresh is our budget calculator.

Frequently asked questions

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