In these cases, overall age-life baseline depreciation can comprise all forms of accrued depreciation or merely baseline depreciation, including incurable physical deterioration and ordinary incurable functional obsolescence.
The criticism of the overall system of measuring accrued depreciation from market sales is that the exercise essentially results in the cost approach's duplicating the sales comparison approach.
The deduction for any item of special incurable functional obsolescence is limited to the reproduction cost remaining at this stage in application of the suggested cost approach method for measuring accrued depreciation by the breakdown method.
The entire measurement of accrued depreciation is dependent on the highest and best use of the facility at the time of valuation.
In the order of deductions for the various forms of accrued depreciation other than external obsolescence and the curables, only so much value remains.
The breakdown method of measuring accrued depreciation using engineers' elemental costs is warranted in appraisal projects involving significant, viable special-purpose buildings, like churches, schools, public buildings, and specially designed industrial or research facilities, and especially in cases where litigation is involved.
A new category of accrued depreciation, overall obsolescence, is deducted next.