The strata corporation for 'The Lofts' at 456 Main Street, Victoria, consists of 20 residential units. They recently received a depreciation report that identifies major balcony concrete repair costing $200,000 in 5 years and parking membrane replacement costing $350,000 in 10 years. Currently, their contingency reserve fund (CRF) has a balance of $80,000, and annual contributions are $20,000. What is the primary purpose of this depreciation report?

Question: The strata corporation for 'The Lofts' at 456 Main Street, Victoria, consists of 20 residential units. They recently received a depreciation report that identifies major balcony concrete repair costing $200,000 in 5 years and parking membrane replacement costing $350,000 in 10 years. Currently, their contingency reserve fund (CRF) has a balance of $80,000, and annual contributions are $20,000. What is the primary purpose of this depreciation report?

Answer options:

• A. To provide a legal opinion on potential liability for construction defects.
• B. To ensure all strata units meet current building code standards. ✅ C. To assist the strata corporation in planning and funding major repairs and replacements over a 30-year period.
• D. To determine the fair market value of the strata units for sale purposes.

Correct answer: C. To assist the strata corporation in planning and funding major repairs and replacements over a 30-year period.

Explanation: A depreciation report, as required by the Strata Property Act, is a planning tool designed to help strata corporations understand the anticipated costs of major repairs and replacements for common property and assets over a 30-year period, aiding in long-term financial planning for the contingency reserve fund.