ASTM E1057-15
Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems

Standard No.

ASTM E1057-15

Release Date

2015

Published By

American Society for Testing and Materials (ASTM)

Status

Be replaced

Replace By

ASTM E1057-15(2020)e1

Latest

ASTM E1057-15(2020)e1

Scope

5.1 The IRR method has been used traditionally in finance and economics to measure the percentage yield on investment.

5.1.1 The IRR method is appropriate in most cases for evaluating whether a given building or building system will be economically efficient, that is, whether its time-adjusted benefits will exceed its time-adjusted costs over the period of concern to the decision maker. However, it has deficiencies that limit its usefulness in choosing among projects competing for a limited budget.

5.2 The AIRR method is a measure of the overall rate of return that an investor can expect from an investment over a designated study period. It is appropriate both for evaluating whether a given building or building system will be economically efficient and for choosing among alternatives competing for a limited budget.

5.2.1 The AIRR method overcomes some, but not all, of the deficiencies of the IRR. The AIRR is particularly recommended over the IRR for allocating limited funding among competing projects.

1.1 This practice covers a procedure for calculating and interpreting the internal rate of return (IRR) and adjusted internal rate of return (AIRR) measures in the evaluation of building designs, systems, and equipment.

1.2 The values stated in inch-pound units are to be regarded as standard. The values given in parentheses are mathematical conversions to SI units that are provided for information only and are not considered standard.

1.3 This standard does not purport to address all of the safety concerns, if any, associated with its use. It is the responsibility of the user of this standard to establish appropriate safety and health practices and determine the applicability of regulatory limitations prior to use.

ASTM E1057-15 Referenced Document

• ASTM E1074 Standard Practice for Measuring Net Benefits for Investments in Buildings and Building Systems
• ASTM E1121 Standard Practice for Measuring Payback for Investments in Buildings and Building Systems
• ASTM E1185 Standard Guide for Selecting Economic Methods for Evaluating Investments in Buildings and Building Systems
• ASTM E1369 Standard Guide for Selecting Techniques for Treating Uncertainty and Risk in the Economic Evaluation of Buildings and Building Systems
• ASTM E1765 Standard Practice for Applying Analytical Hierarchy Process (AHP) to Multiattribute Decision Analysis of Investments Related to Buildings and Building Systems
• ASTM E1946 Standard Practice for Measuring Cost Risk of Buildings and Building Systems
• ASTM E2204 Standard Guide for Summarizing the Economic Impacts of Building-Related Projects
• ASTM E631 Standard Terminology of Building Constructions
• ASTM E833 Standard Terminology of Building Economics*， 2024-04-20 Update
• ASTM E917 Standard Practice for Measuring Life-Cycle Costs of Buildings and Building Systems
• ASTM E964 Standard Practice for Measuring Benefit-to-Cost and Savings-to-Investment Ratios for Buildings and Building Systems

ASTM E1057-15 history

• 2020 ASTM E1057-15(2020)e1 Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• 2015 ASTM E1057-15 Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• 2006 ASTM E1057-06(2010) Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• 2006 ASTM E1057-06e1 Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• 2006 ASTM E1057-06 Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• 2004 ASTM E1057-04 Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• 1999 ASTM E1057-99 Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems