CAIO supplements the traditional accounting analyses and reporting requirements that follow AASB or IFRS rules, but does not replace them.  It studies cash flows only.

Accounting policies take account of aspects such as ROA, ROIC, taxation effects and the potential salvage values of an asset at the time of its disposal, but these are explicitly excluded from the model.  Its focus is on improving the short-term marginal performance from progressive investments in lazy assets that may be poorly deployed,  or which may lack reliability and risk failing to provide a secure stream of outputs into the future.

Nor does it assist with decisions relating to new projects, such as whether or not the firm should take steps to buy a new capital asset for a new activity.  The technique examines only capital assets and their activities that are already in place, and which are expected to continue to be functional well into the future.  Decisions about new ventures require a broader ambit and additional tests for acceptance.

Neither the calculation of the REPI nor the outputs from the additional qualitative risk profiling module provide stand-alone information.  The model is specifically designed to provide a standardised comparative indicator for examining the effects of alternative investments for an asset under a range of different circumstances, or across time.

CAIO applies exclusively to physical capital assets.  These, by definition, exclude human resources or intangible activities that cannot be linked back to a physical asset