Index Book - 01

No Name Page No.

1 Planning engineer.
2 Quantity Surveyor:
3 Cost Estimation.
4 Cost Control:
5 CASHFLOW IN CONSTRUCTION
6 S-CURVE
7 Cost Overruns in Construction:
8 WHAT IS TENDERING?
8A. TENDER DOCUMENTATION
9 VALUE ENGINEERING:
10 Scheduling in Construction Project: A Basic Guide
11 BUDGET of CONSTRUCTION.
11A Construction budgets:
12 Zero-based budgeting (ZBB)?
13 5 Feasibility Study in Construction
14 Procurement of Construction?
15 Contract Management
15A. Top 10 skills for contract management.
15B. Types of Construction Contracts.
16 FIDIC Contracts: A Beginner's Guide
17 Claims Basic Knowledge.
18 Risk management in Construction.
18A Contract Risk
19 BILL OF QUANTITIES (BOQ) Basic Knowledge.
19A Bill of Quantities (BOQ).
20 IPC: Interim Payment
21 Variance:
22 What is ‘price escalation’? or ‘Price Adjustment.
23 RATE ANALYSIS
34 Variations in Construction.
24A Variations:
26 Construction contingency?
27 Material Present Market Price:
28
29
30

3
Index Book - 02

No. Name Page

1 20 Most Common Interview Questions and Best Answers (Basic).

2 Expart Quantity Surveyor Suggestion for Interview (Basic).

3 Quantity Surveyor 9 Secrets (Basic).

4 TOP 100 term to quantity surveyors definitions: (Basic).

5 Stress Strain Diagram (Basic).

6 Concre Grade (Basic).

7 Area Voliun Calculation (Basic).

8 Structural Components: (Basic).

9 BBS (Basic).

10 SFD & BMD Diagram (Basic).

11 Materials Test Name (Basic).

12 Grade of Steel (Basic).

13 Abrovision for Quantity Surveyor or Civil Engineer (Basic)

14 Unit Weight (Basic) (Cement, Steel, Concrete, RCC).

15 CLEAR COVER TO MAIN REINFORCEMENT (Basic).

16 WEIGHT OF ROD PER METER LENGTH (Basic).

17 DESIGN MIX (Basic).

18 WEIGHT OF ROD PER METER LENGTH (Basic).

19 DESIGN MIX (Basic).

20 CONVERSION FACTORS (Basic).

21 Company Name & Contract (Basic).

22 Estimation (Basic).

23 Former Interview Experience.

24 Software Basick Knowledge: Excel, Auto Cad, Planswieft, MS Project, Premavera P6.

25

4
Quantity Surveyor Interviews Topics.
A. Written Interview.
B. Viba Interview.
C. Important QS Formate.

1. Planing Engineering Basic Knowledge (Defination, key, Types)

2. Quantity Survey Basic Knowledge, Defination, Key, Types
3. Estimation Basic knowledge.

4. Cost Controlling Basic Knowledge.

5. Cash Flow.
6. S-Curve.
7. Cost Over Runs.
8. Tender Basic Knowledge.
9. Value Engineering.
10. Scheduling Basic Knowledge.
11. Buget Basic Knowledge.
12. Zero budget?
13. Feasibility Study Basic knowledge.
14. Procurement Basic Knowledge.

15. Contract Management Basic Knowledge.

16. FIDIC Basic Knowledge.
17. Claim Basic Knowledge.
18. Risk Management.

19. Bill of Quantity (BOQ) Basic Knowledge.

20. IPA & IPC Basic Knowledge.
21. Variance Basic Knowledge.
22. Price Adjustment Basic Knowledge.

23. Rate Analysis Formate (Earth Work, Concrete, Plaster, Brick,

24. Variation (Quantity, Price).
25. Price Esclation or Adjustment.
26. Contengency.

27. Materials Present market price (Cement, Sand, Aggregate, Rebar, Bricks, Bitumin).
28. Equipment related Quertion & Answer.

29. Software Basic Knowledge: Excel, MS Project, Premavera P6, Planswieft, Auto CAD.
30. Estimation: (Bricks, Rebar, Plaster, Pile-Circular, Wall, Slab, Road, Bridge, Paint).
31. Area & Volume Calculation Basic Knowledge (Area, Length, Weight, Volum).
32. Civil or QS Abrovision: (BOQ, MOQ, RFI, IPC, ASTM, BNBC, RSC, FIDIC, CBR, VO, 3M, MOQ)
33. Conversions Basic Knowledge.
34. Clear Cover
35. BBS Formula & Basic Knowledge.
36. Materias test Name.

5
 37. Unit Weight Basic Knowledge.
38. Concrete Grde Basic Knowledge.
39. Poject or Structure Component:
40. Stress Strain Diagram with Basic Knowledge.
41. SFD & BMD Diagram with Basic Knowledge.)
42. Common Interview Quertion & Answer for All Department.
43. Company Name list with Contacts.
44. Interview Basic Suggestion by Expert QS.
45. Interview past Experience Quertion & Answer.
46. General Knowledge
47. Construction Productivity.
48.

Quantity Survey Formate:

1. Rate Analysis Formate.
2. Varition Order (VO).
2. Price Adjustment.

6
1. Planning engineer.
A planning engineer works with a site manager to develop suitable construction methods and sequences
for a project.

Job description

Planning engineers determine and develop the most suitable and economically viable construction and
engineering methods for projects. They are involved throughout the development stages, and are
present on site during the build to oversee procedures. It is the responsibility of the planning engineer
to estimate a timescale for a project and to ensure that the outlined deadlines are met. They work
closely with site managers and other engineers to ensure a project runs on schedule and that material
supplies are sufficient.

Work activities

Deciding on the most appropriate engineering techniques and sequences of activities for each project
stage.

Drawing plans; using specialised design software packages.

Ensuring plans meet the client’s specifications.

Making estimations for timescales and costs.

Supervising the project at all stages and providing solutions to problems.

Collaborating with site managers, surveyors, engineers, site worker and other professionals.

Organising the transportation of materials.

Ensuring procedures are carried out safely.

Work conditions

Travel: is necessary in order to visit sites; positions with multinational companies may involve periods on
sites based overseas.

Working hours: are typically standard office hours, but strict deadlines mean longer hours, weekends
and being on-call are all possible.

Location: with construction and engineering companies throughout the Republic of Ireland and
Northern Ireland. Some companies offer posts overseas.

Entry requirements

A relevant degree in an engineering subject is required; prior experience in engineering management is

necessary for many positions.

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2. Quantity Surveyor: responsibilities of a QS
Quantity surveyor: A professional who specializes in estimating and managing the costs and quantities
of materials, labor, and resources required for construction projects.

A quantity surveyor (QS), also known as a cost estimator or a construction economist, is a professional
who specializes in estimating and managing the costs and quantities of materials, labor, and resources
needed for construction projects. Their role is essential in ensuring that construction projects are
completed within budget and meet financial objectives.

The primary responsibilities of a quantity surveyor typically include the following:

1. Cost Estimation: Quantity surveyors evaluate project plans, specifications, and drawings to estimate
the quantities of materials, labor, and equipment required for construction. They use their expertise and
industry knowledge to assess costs accurately.

2. Cost Management: QS professionals monitor project costs throughout the construction process,
comparing actual costs with estimated costs. They identify cost overruns, analyze the causes, and
recommend appropriate cost-saving measures.

3. Tendering and Procurement: Quantity surveyors assist in preparing tender documents, evaluating
bids from contractors and suppliers, and making recommendations based on cost and quality. They also
negotiate and manage contracts with subcontractors and suppliers.

4. Value Engineering: QS professionals analyze construction methods, materials, and designs to

optimize project costs without compromising quality. They suggest alternative approaches to achieve
cost savings while meeting project requirements.

5. Financial Reporting: Quantity surveyors prepare regular financial reports, including cost forecasts,
cash flow projections, and progress payment assessments. These reports provide project stakeholders
with up-to-date information on project financials.

6. Variation and Claims Management: QS professionals assess and manage variations or changes to the
original project scope. They evaluate the impact of changes on project costs, negotiate claims with
contractors, and provide recommendations for resolution.

7. Risk Assessment: Quantity surveyors identify and analyze potential risks impacting project costs. They
develop risk management strategies and advise on contingency measures to mitigate financial risks.

8. Final Account Preparation:

After a project, quantity surveyors prepare the final account, which includes assessing the total project
costs, variations, and claims. They reconcile costs, finalize payments, and provide documentation for
project closure.

Quantity surveyors play a crucial role in ensuring the financial success of construction projects by
effectively managing costs and resources. Their expertise helps stakeholders make informed decisions
regarding budgeting, procurement, and risk management throughout the project lifecycle.

8
3. Cost Estimation.
Cost estimation is the process of approximating the expenses associated with a project or activity. It
involves assessing various factors and resources required to complete the project and determining
their corresponding costs. Cost estimation is utilized in numerous fields, including construction,
manufacturing, software development, and business planning, to name a few.

The purpose of cost estimation is to provide a realistic projection of the financial resources needed for a
project. It aids in budgeting, decision-making, and evaluating the feasibility and profitability of an
undertaking. The accuracy of cost estimation is crucial for ensuring that sufficient funds are allocated
and that the project can be completed within the established budget.

There are several methods and techniques used for cost estimation, and the selection of the appropriate
approach depends on the nature of the project and the available data. Some commonly used cost
estimation methods include:

1. Analogous Estimation: This method relies on historical data from similar past projects to estimate the
costs of the current project. It involves comparing the characteristics and costs of previous projects to
derive an estimate for the new project.

2. Parametric Estimation: Parametric estimation utilizes mathematical relationships between specific

project parameters and their associated costs. It involves establishing cost-estimating formulas or
models based on historical data and applying them to the current project's relevant parameters.

3. Bottom-Up Estimation: This method involves breaking down the project into smaller, more
manageable components or work packages. Each component is then estimated individually, considering
the resources required and their associated costs. The individual estimates are then aggregated to
determine the overall project cost.

4. Three-Point Estimation: This technique incorporates three different estimates for each task or
activity: the optimistic estimate (best-case scenario), the pessimistic estimate (worst-case scenario), and
the most likely estimate (realistic scenario). These three estimates are used to calculate an average or
weighted estimate, providing a more comprehensive view of the potential costs.

5. Vendor Quotes and Bids: For projects involving the procurement of goods or services from external
vendors or contractors, obtaining quotes and bids from multiple vendors can be an effective method of
cost estimation. This approach involves requesting proposals or quotes from potential suppliers and
evaluating them to determine the most reasonable and competitive cost.

It's important to note that cost estimation is not a precise prediction, as it relies on assumptions,
uncertainties, and various external factors. Therefore, regular monitoring, updating, and refinement of
the cost estimates throughout the project's lifecycle are crucial to ensure accuracy and account for any
changes or unexpected circumstances that may arise.

Cost estimation is an essential process in construction projects that involves determining the anticipated
costs associated with various aspects of the project. It aims to provide an estimation of the total
expenses involved in completing the construction project. The accuracy of the cost estimation is crucial
for budgeting, planning, and decision-making purposes.

9
Here are the key factors considered during the cost estimation process:

1. Materials: The cost of materials, including the quantity and quality required for the project, is a
significant consideration. It involves estimating the costs of construction materials such as cement, steel,
wood, bricks, electrical components, plumbing fixtures, and finishing materials.

2. Labor: Estimating labor costs involves determining the number of workers required, their skill levels,
and the duration of their involvement in the project. It includes considering various trades, such as
carpenters, electricians, plumbers, masons, and general laborers, along with their respective wages and
benefits.

3. Equipment: The cost of construction equipment, including rental or purchase, is another important
factor. This includes estimating the expenses associated with machinery, tools, heavy equipment,
cranes, scaffolding, and other specialized equipment needed for the project.

4. Overhead expenses: Overhead costs encompass various indirect expenses incurred during the
construction project. These may include administrative costs, permits and licenses, insurance, utilities,
site security, site office setup, project management, and supervision.

5. Subcontractors: If certain tasks or portions of the project are outsourced to subcontractors, their
costs should be considered separately. This involves estimating the expenses associated with
subcontracted work, such as electrical installations, plumbing, HVAC systems, or specialized trades.

6. Site conditions: The project's location and site conditions can impact the costs. Factors like site
accessibility, topography, soil conditions, existing infrastructure, and environmental considerations can
influence the overall expenses.

7. Contingencies: It is essential to allocate a contingency amount to account for unforeseen

circumstances or changes during construction. This contingency helps mitigate risks and uncertainties,
allowing for adjustments to the budget when unexpected expenses arise.

Cost estimation methods can vary, ranging from simple approximations based on historical data to more
detailed itemized breakdowns using specialized software. Construction professionals, such as quantity
surveyors or estimators, typically perform these cost estimations based on their expertise, industry
knowledge, and experience with similar projects.

It's important to note that cost estimation is an iterative process, with continuous updates and
refinements as the project progresses and more detailed information becomes available.

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 4. Cost Control:

What is cost control in construction?

Traditionally, cost control in construction refers to the ongoing process of managing costs – such as materials,
labor, overhead, and change orders – associated with a project in order to improve profitability. The process of
controlling costs helps project owners and managers deliver projects on time and on budget while increasing the
revenue generated from that project.

• How to perform Cost Control in Construction Projects

How to perform Cost Control in Construction Projects

• Posted byHANY ISMAIL, MSC, PMP

• CategoriesPROJECT MANAGEMENT
• DateSEPTEMBER 29, 2020
• Comments0 COMMENT
The cost control Process is an iterative series of actions. It means, after we create the budget plan, collect the
updates (Actuals) analyses and report the cost control performance, then we might need to take some corrective
actions and update the budget plan accordingly.

Fore example, if we calculated our budget cost plan based on certain productivity rates for Raft foundation. During
the updates we found big deviation between budget productivity and actual Productivity in site.
upon investigation , we found that due to site special conditions, the raft foundation is taking more hours than
budget. Accordingly, Cost control Engineer should inform the management about his/her findings
and take a permit in to change the budget cost plan. This action will give the management of the company an early
alarm and estimation of this issue impact to the project cash flow.

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 PDCA Cycle
1- Budget cost plan components:
During the course we will see step by step how to create the budget plan using smart techniques. However, in this
point I want to let you know the basics of budget cost plan.

First step in cost control is to prepare the project budget costs. Accordingly, we have two types of costs:

• Direct costs: it is the cost of materials, taboos, Equipment, subcontractors or any other Costs that can be loaded
to a certain activity.
• Indirect costs: i it is the cost of supervision salaries, site offices, money paid to issue l. C, Guarantees..etc to the
client. this involves also any cost cannot be loaded to a certain activity.

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Direct and indirect Costs

Example of cash flow:

Cash in And Cash Out

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The chart above showing the net cash flow of the project where it will start with advanced payment and monthly
wise work in progress will require spending money and accordingly we get paid from the client. The most useful
information in this chart that by month of March 2020, the company should have around 20 millions to finance the
project. this is the capital required which is very important to be known.

2- Collect the updates:

This is where most of engineers stuck and could not provide fast and accurate updates. Remember, we agreed at
the beginning of the course that we want to work smart not hard. Accordingly in this course I have developed a
smart way to update the progress of actual costs with minimal efforts. To be honest, the challenge here is in the
progress updates since Actual costs can be collected from invoices. However, it is important to know the Actual
cost of each activity as well. This will help us to define problems and cost overrun later on.

Actual Cost Update

3- Analysis and report:
This is the most exciting part where all your efforts will show its values. puts pits and pies of information together
so will result an amazing summary report with limitless possibilities of other detailed reports. By implementing the
cost control technique in this course, you will be able to find where are the activities that causing delays to the
project and take the relevant correction actions.

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Cost Control Summary Report
B- Project Detailed report:

Detailed Cost Control Report

4- Corrective Actions:
NOW You know as per the example above that Zone 2 and Zone 3 Concrete for foundations are causing cost
overrun of 5,152 and 5,438 respectively. You can go now to the concern person and talk with him or her to see
how to fix this issue. This called corrective action. You might then need to update your budget plan as we said
before that cost control is an iterative process.

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5. CASHFLOW IN CONSTRUCTION
What is cashflow ?
Cash flow in construction refers to the inflow and outflow of cash throughout the life of a
construction project. It is the process of forecasting, monitoring and controlling the financial
aspects of a construction project. It is used to predict when and how much money will be
needed to pay for the costs of the project and when the project will generate cash from the
completion of the work.

Type of cashflow in construction project ?

In construction projects, there are typically two types of cash flow: inflow and outflow.
-Inflow of cash: This refers to the cash that is received by the project, such as payments from
the client, progress payments, and financing.
-Outflow of cash: This refers to the cash that is spent on the project, such as materials, labor,
equipment, and other expenses.

What are the different type of cashflow analysis ?

Additionally, within these two types of cash flow, there are different types of cash flow analysis:
-Monthly cash flow: This analysis shows the inflow and outflow of cash on a monthly basis,
allowing project managers to see the short-term financial status of the project.
-Cumulative cash flow: This analysis shows the total inflow and outflow of cash over the entire
duration of the project, allowing project managers to see the long-term financial status of the
project.
-Budgeted cash flow: This analysis compares the planned inflow and outflow of cash with the
actual inflow and outflow, allowing project managers to identify any discrepancies and take
corrective action.
-Forecasted cash flow: This analysis predicts the future inflow and outflow of cash, allowing
project managers to anticipate future financial needs and make decisions accordingly.

Use of cashflow in construction ?

Some of the main uses of cash flow in construction include:

1.Identifying potential cash flow shortages.
2.Managing financial risks.
3.Tracking project progress.
4.Planning for future expenses.
5.Improving communication with stakeholders.
6.Helping to secure financing.
7.Making strategic decisions.
8.Generating funds

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What is S-curve in cashflow ?

An S-curve in cash flow is a graphical representation of a construction project's cash flow over
time. It is used to visualize the project's spending and earning patterns and to identify potential
cash flow issues. The shape of the curve gives an overall shape that resembles an "S", hence the
name S-curve. The S-curve can be used to identify patterns and trends in the project's cash
flow, such as when cash inflow is expected to slow down and when the project is expected to
start generating cash from completion of the work.

Type of cashflow in construction ?

1.Actual Cash Flow

2.Projected Cash Flow
3.Positive Cash Flow
4.Negative Cash Flow
5.Cumulative Cash Flow
6. Cash Flow Forecast
7. Cash Flow Statement
8. Cash Flow Analysis

#cashflow #cashflowmanagement #cashflowanalysis #construction #costmanagement

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5A. Cash flow forecasting: Here are some key points to
understand about cash flow forecasting in construction
projects.
Cash flow forecasting: The estimation and monitoring of cash inflows and outflows throughout
a construction project to ensure that sufficient funds are available at the right time.

Cash flow forecasting is a crucial aspect of financial management in construction projects. It

involves estimating and monitoring the timing and amounts of cash inflows and outflows
related to the project. The primary goal is to ensure that there are sufficient funds available
when needed to cover project expenses, payments to suppliers and subcontractors, and other
financial obligations.

Here are some key points to understand about cash flow forecasting in construction
projects:

1. Estimation of Cash Inflows: Cash inflows in construction projects typically include payments
from clients or project owners, progress billings, and any additional funding sources. These
inflows are usually scheduled based on project milestones or contractual agreements. It is
essential to estimate the timing and amounts accurately to determine when cash will be
received.

2. Projection of Cash Outflows: Cash outflows in construction projects encompass various

expenses such as labor costs, material purchases, subcontractor payments, equipment rentals,
overhead expenses, and loan repayments. These outflows need to be projected based on the
project schedule, budget, and contractual obligations. Accurate estimation of cash outflows
helps in planning and ensuring funds are available to cover expenses.

3. Consideration of Project Timeline: Cash flow forecasting should align with the project
timeline, considering the expected duration of each activity and the associated cash
requirements. It helps in identifying periods of high cash demand, such as when major
purchases or subcontractor payments are due, and allows for the proper allocation of funds.

4. Monitoring and Control: Regular monitoring of cash flow during the construction project is
crucial to identify any deviations from the forecasted cash flow. By comparing actual cash
inflows and outflows with the projected values, project managers can take corrective actions
promptly. This may involve adjusting the project schedule, negotiating payment terms with
clients or suppliers, or securing additional funding if necessary.

5. Contingency Planning: Cash flow forecasting allows project stakeholders to anticipate

potential cash shortages or surpluses in advance. In case of expected cash shortfalls,
contingency plans can be developed, such as arranging for interim financing or adjusting the
project timeline. Similarly, if there is excess cash, it can be invested or used to accelerate
project activities.
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6. Software and Tools: Cash flow forecasting in construction projects can be facilitated through
various software and tools specifically designed for project management and financial analysis.
These tools help in automating calculations, generating cash flow reports, and providing visual
representations of cash flow trends.

In summary, cash flow forecasting in construction projects is a vital financial management

practice. It ensures that sufficient funds are available at the right time, helping to maintain
project continuity, avoid financial difficulties, and make informed decisions regarding project
financing and resource allocation.

19
6. S-CURVE
What is S-Curve in construction ?

In construction, an S-curve is a graphical representation of a project's progress over time. The S-

curve typically starts with a low level of progress at the beginning of the project and then
gradually increases as more work is completed. As the project progresses, the level of progress
will continue to increase until it reaches a peak, at which point it will start to decrease as the
project nears completion. The shape of the curve gives an overall shape that resembles an "S",
hence the name S-Curve.

What are the use of S-Curve in cashflow ?

1.Track the project's cash flow.
2.Identify cash flow patterns.
3.Identify cash flow issues.
4.Forecast cash flow.
5.Monitor project's financial health

What are the uses of S-curve in construction project ?

In construction projects, an S-curve is a graphical representation of a project's progress over

time, and it can be used for a variety of purposes, including:
1.Scheduling
2.Cost management
3.Resource allocation
4.Performance evaluation
5.Forecasting
6.Change management
7.Communication

It's worth noting that an S-curve can be an effective tool for project managers to track and
manage the progress of the project, and to identify potential issues early on, allowing them to
take corrective action and keep the project on schedule and on budget.

Is there any specific project management software that can be used for S-Curve preparation ?
There are several project management software that can be used to prepare S-Curve. Some of
the most popular options include:
1. Microsoft Project.
2.Primavera P6.
3. MS Excel
4.Other project management software such as Deltek Cobra, Asta Power project, and
Smartsheet, they all have the capability of creating S-Curve by tracking the project schedule,
budget, and actual progress and creating a graphical representation of the data.

It's worth noting that many project management software have the capability to create S-Curve
20
and it's important to choose a software that fits your project and team's needs, and that the
team members are familiar with its usage.

Type of S-Curve ?
In construction projects, there are several types of S-Curves that can be used to track and
visualize the project's progress, including:

1.Schedule S-Curve.
2.Cost S-Curve.
3.Resource S-Curve
4.Earned Value S-Curve
5. Cash flow S-Curve

It's worth noting that the type of S-Curve used in a construction project will depend on the
specific needs of the project, and the goals of the project team. Additionally, multiple types of
S-Curve can be used together to get a comprehensive view of the project's progress.

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7. Cost Overruns in Construction:
"Rising costs are common construction industry, 9 out of 10 projects experience overrun"–International
Journal of Innovation, Management & Technology

●What is Cost Overrun In Construction?

Any unexpected incurred cost(s) that causes a project to exceed the overall budget (terms) you’ve agreed to
with your client.

●What causes cost overrun?

1.Frequent design change during construction phase

Rework has become a common trope of construction industry, with as high as 70% rework incidents due to
design inconsistencies or errors.

•Construction errors(Improper installations)

•Omissions/errors made in design process
•Mistakes made in fabrication
•Revisions requested by customer

2.Contractors’ financing

Contractors, who receive payment after completing part of project face a financing challenge balancing
multiple projects & budgets.

They have to be able to certify sufficient funds are available to undertake projects & make payroll.

3.Payment delay

With small cash reserves on hand, it becomes challenging to pay subcontractors, failure to timely payments
for completed work makes it difficult for construction companies to meet project objectives & maintain
timelines.

4.Lack of contractors’ experience

Construction projects are becoming more complicated & requiring more time & expertise to complete.

Lack of contractor experience & associated expertise, expensive rework is always a risk.

5.Poor Cost Estimation

Estimators determine expenditure of resources to complete project based on plans & specifications.
This process involves collecting & analyzing large amounts of independent, but related, cost & non-cost data

As construction projects carry a high degree of uncertainty & much is unknown until projects break ground.

22
As a result, cost estimates might be inaccurate & lead to a cost overrun.

Causes of inaccurate cost estimate:

•Cost estimator being overly optimistic

•Unreliable data used to estimate
•Absence of a national database to base prices on.
•Lack of estimator’s experience
•Honest mistakes

6.Poor Tendering (BID) Documents

•Miscommunication between contractor & designer

•Insufficient details in the working drawings & a lack of coordination between necessary parties
•Lack of human resources in the design firm
•Designer lack knowledge of available material & equipment
•Use of incomplete shop drawings & specifications

7.Poor material management

Not knowing what you have on hand or planning can result in time spent waiting for materials to arrive
resulting in cost overrun in lost productivity Impacting
•Labor & manpower
•Admin & management
•Reduced materials budget
•Lengthened timeline
•Degraded reputation

●How to Control Cost Overrun In Construction Projects?

•Construction Project Forecasting

•Seeking Financial Support
•Hiring the Right Team
•Employing Productivity & Collaboration Tools

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8. WHAT IS TENDERING?
Tendering is the process by which a company or organization invites bids for a project or contract, typically
through a public or private request for proposal (RFP) process. The process involves the release of a detailed
project description and specification, which is then sent to a pre-qualified list of contractors or suppliers who
are invited to submit a bid. The bids are then evaluated based on a set of criteria, and the contract is
awarded to the contractor or supplier who offers the best value for money. Tendering is commonly used in
the construction, engineering, and procurement industries, and is a standard practice for many government
and public sector projects. The process is designed to ensure that contracts are awarded fairly, transparently,
and cost-effectively.

What are the method of tendering?

There are several methods of tendering, including:
1. Open Tendering
2. Selective Tendering
3. Negotiated Tendering
4. Single-stage Tendering
5. Two-stage Tendering
6. Competitive Dialogue
7. Electronic Tendering (e-Tendering)
The method of tendering depends on the project and the client's needs and requirement. The client may
choose a specific method that best suits the project and the company's needs.

What are the type of tendering ?

There are several types of tendering, including:
1. Lowest-Price Tender
2. Best-Value Tender
3. Quality-Based Tender
4. Design and Build Tender
5. Management Contracting Tender
6. Public-Private Partnership (PPP) Tender

Why do construction project need tendering ?

Construction projects need tendering for several reasons:
1. To ensure fair and open competition
2. To achieve best value for money
3. To identify qualified contractors or suppliers
4. To reduce risk
5. To meet legal requirements
6. To improve efficiency and transparency
7. To develop the most suitable solution

What are the element or process of tendering ?

The elements of tendering in construction include:
1. Request for Proposal (RFP)
2. Prequalification
3. Bid submission
4. Bid evaluation
5. Award of contract
6. Contract negotiation
7. Performance bond

24
8. Insurance
9. Licensing
10. Safety Plan
11. Project management plan
12. Closeout documents:
These elements are part of the standard process of tendering in construction, and may vary depending on the
type of tendering, the project, and the client's needs and requirements.

8A. TENDER DOCUMENTATION The typical components

of tender documentation in construction projects
include.
Tender documentation: The set of documents prepared by a quantity surveyor to invite bids from
contractors, including drawings, specifications, bills of quantities, and contractual terms.

Tender documentation refers to the collection of documents and information that are prepared and
provided by the organization issuing the tender. These documents are intended to provide interested
parties with all the necessary details and requirements to submit their bids or proposals.

Tender documentation typically includes:

1. Invitation to Tender (ITT): This document serves as an official invitation to potential bidders,
providing an overview of the project, its objectives, and the scope of work. It may also outline the
submission process and deadlines.

2. Instructions to Bidders: This document provides guidelines and instructions for prospective bidders
on how to prepare and submit their bids. It may include information on the format and structure of the
proposal, evaluation criteria, and any specific requirements or conditions.

3. Specifications: The specifications outline the technical details and requirements of the project,
including the materials, equipment, or services needed. It provides a clear description of what the
bidder needs to deliver.

4. Terms and Conditions: This document outlines the legal and contractual terms that will govern the
relationship between the organization and the successful bidder. It includes information about payment
terms, delivery schedules, performance guarantees, and other contractual obligations.

5. Evaluation Criteria: The tender documentation may specify the criteria that will be used to evaluate
and compare the bids. This helps bidders understand what factors will be considered during the
selection process, such as price, quality, experience, and compliance with specifications.

6. Contract Template: In some cases, the tender documentation may include a sample contract template
that outlines the terms and conditions that will be used to formalize the agreement with the successful
bidder.

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It's important for potential bidders to thoroughly review the tender documentation to ensure a clear
understanding of the project requirements and to prepare their bids accordingly. Each organization may
have specific requirements and formats for tender documentation, so it's crucial to carefully follow the
instructions provided in the tender documents.

The typical components of tender documentation in construction projects include:

1. Drawings: Architectural, structural, electrical, mechanical, and other technical drawings that depict
the design and layout of the project.

2. Specifications: Detailed written descriptions of materials, finishes, construction methods, and quality
standards required for the project. Specifications provide further clarity on the project requirements.

3. Bills of Quantities (BOQ): A detailed itemized list of the materials, quantities, and associated costs
required for the project. The BOQ helps contractors in estimating project costs and preparing their bids.

4. Contractual Terms: The contractual terms and conditions that will govern the relationship between
the client and the contractor. This may include payment terms, project timelines, dispute resolution
mechanisms, insurance requirements, and any other contractual obligations.

5. Instructions to Tenderers: This document provides instructions to the contractors on how to prepare
and submit their bids. It includes information on the format and structure of the bid, submission
deadlines, site visit requirements, and any specific requirements for the tender process.

6. Additional Documents: Depending on the complexity and nature of the project, tender
documentation may also include additional documents such as project schedules, health, and safety
requirements, environmental impact assessments, and any other relevant information.

The tender documentation plays a crucial role in ensuring a fair and transparent bidding process.
Contractors rely on these documents to understand project requirements, estimate costs, and prepare
their proposals accordingly. It is important for contractors to thoroughly review the tender
documentation and seek clarification if needed before submitting their bids.

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9. VALUE ENGINEERING:
The value engineering process typically consists of the following steps.
Value engineering: A systematic approach to analyzing and optimizing the value of a project by
balancing the cost, function, quality, and aesthetics of its components.

Value engineering is a systematic and organized approach to improving the value of a product, system,
or process. It involves analyzing and evaluating a project's various components and aspects to identify
opportunities for cost reduction, performance improvement, and overall value enhancement.

Value engineering is a systematic approach used to analyze and optimize the value of a project. It
involves evaluating the project's components, such as materials, processes, systems, and designs, to
achieve the best possible balance between cost, function, quality, and aesthetics. The primary objective
of value engineering is to identify opportunities for improving the project's value while reducing costs
and maintaining or enhancing its overall performance.

The value engineering process typically consists of the following steps:

1. Information Gathering: The project team gathers relevant data and information about the project,
including its requirements, constraints, objectives, and stakeholders' needs.

2. Functional Analysis: The project's functions and performance requirements are analyzed and clearly
defined. This step involves breaking down the project into its constituent parts and understanding the
purpose and interrelationships of each component.

3. Creativity and Idea Generation: Various brainstorming techniques are employed to generate various
ideas and alternatives that could potentially improve the project's value. This step encourages
innovative thinking and challenges conventional approaches.

4. Evaluation and Selection: The generated ideas and alternatives are evaluated based on their
potential to improve value. This evaluation considers factors such as cost savings, improved
performance, reduced risks, enhanced aesthetics, and other relevant criteria. The most promising
options are selected for further development.

5. Development and Analysis: The selected ideas and alternatives are further developed and analyzed in
detail. This involves conducting cost-benefit analyses, feasibility studies, and risk assessments to
determine the viability and potential impact of each option.

6. Recommendation and Implementation: The most beneficial options are recommended to the project
team and stakeholders. The recommendations are based on a comprehensive evaluation of the
alternatives, considering the project's objectives, constraints, and priorities. Once approved, the
recommendations are implemented in the project.

7. Continuous Monitoring and Improvement: The progress and performance of the implemented
changes are monitored and evaluated over time. This step ensures that the anticipated benefits are
realized and identifies any additional opportunities for value improvement.

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Value engineering can be applied to various types of projects, including construction, engineering,
product design, and manufacturing processes. It aims to optimize the value proposition by striking the
right balance between cost, function, quality, and aesthetics, ultimately leading to improved project
outcomes.

Value engineering can be applied to a wide range of industries and projects, including construction,
manufacturing, software development, and business processes. Its primary goal is to optimize the value
proposition by identifying and implementing improvements that enhance performance, quality, and
cost-effectiveness.

By adopting a systematic and structured approach, value engineering helps organizations make
informed decisions that result in increased value, improved efficiency, and enhanced customer
satisfaction.

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10. Scheduling in Construction Project: A Basic Guide

In this basic guide to construction project scheduling, we’re going to discuss why we have schedules,
why they’re important on projects, and how they should be used. In addition, I’m going to jump into and
discuss essential Critical Path Method (CPM) concepts.

What Is Construction Scheduling?

A construction project schedule is either a written or graphical representation on how the project is to
be completed or constructed. When I say written, it could be a written narrative. It could be a
description. It could be depicted as a bar chart schedule or a CPM schedule.

A construction schedule is analogous to a contractor’s bid. Just as a contractor’s bid is an estimate of its
cost that it expects to spend to build the project, the schedule represents an estimate of the time
required to construct the project.

What Is A Construction Scheduler?

The construction scheduler is the person on the project who is responsible for developing and updating
the project schedule.

There are really two types of schedulers. One is a button pusher, someone who takes the information
from one party and inserts it in scheduling software like Primavera, Microsoft Project, or Asta
Powerproject.

The second type is what I would call a professional scheduler. That’s someone who knows and
understands construction means and methods, as well as the capabilities of the software. Most
importantly, they also understand what construction scheduling best practices are and how to
incorporate them into the project schedule.

Too often projects don’t have a professional scheduler who can pull all those elements together.
Bringing on such a person does not guarantee project success. But the right professional scheduler can
work with the project manager and the project superintendent to ensure that the plan residing in their
heads is accurately depicted in the project schedule and will protect the contractor’s risk.

Construction Scheduling Basics

In nearly every case, a construction contract will require the contractor to complete the project within a
specific duration or by a specified completion date.

For every construction project, there is a lot of work that must be done before contract completion.

The construction project schedule provides a detailed description and representation of how the
contractor plans to construct the project’s work scope. That work scope is represented by the schedule’s
work activities, how long they’re going to take, and their sequence. One thing to remember is that a
construction project schedule is the only project management tool that can forecast when the project
will finish.

The construction schedule should predict, based on the contract, the plan, and how the work should
progress to forecast, when the project is expected to finish.
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Why Do We Need Project Schedules?

Increasingly, over the last 15 or 20 years, construction owners have required that contractors prepare
schedules during the construction project. There are two primary reasons for this trend.

First, as projects become more complex and have tighter budgets, we need schedules to help us manage
our construction projects. As a construction project management tool, a schedule enables the project
participants (not just the owner, the contractor, the engineer, or the architect) to understand the plan
for completion. It allows the parties to coordinate all the elements of the work.

To some degree, this trend has also been driven by litigation. Time is money. Every day a construction
project is delayed, either the owner, and/or both the owner and contractor, will incur additional costs to
support that project. Therefore, we need a way to measure to what extent the project is delayed.

The schedule allows us to identify not just what the work is, but the responsibilities of each party, and
the party responsible for each of the activities.

It allows us to track performance. Ultimately, having a reasonably accurate schedule, be that a bar chart
or a CPM schedule, will also enable the project participants to identify and resolve project delay as it
occurs.

The last thing you want to do is ignore time-related issues during the project and have the parties kick
the can down the road. This will often result in a claim being submitted because time wasn’t resolved,
the project finished late, and the parties can’t agree as to the cause of the delay. This can and often
does result in unnecessary money spent in litigation.

That is not a recipe for success on construction projects. We want to finish projects on time and on
budget. A way to do that is to address delay as it occurs during the project.

What Is Critical Path Method Scheduling?

The most commonly used construction scheduling technique is the CPM approach. This approach
models or depicts the construction plan in what is called a network. This network consists of activities
and logic relationships that determine the overall sequence of construction.

In a CPM schedule, “activities” depict every element of work in the project, be it preparation,
submission and review of submittals, procurement, or construction. We connect those activities with
“logic relationships.” For example, the schedule may depict that one activity can start only after another
is finished. The combination of the work activities, their duration, the logic in the schedule, and a
mathematical formula allow us to predict when the project will finish.

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A nice thing about the CPM schedule is it allows us to model both the physical and the contractual
limitations or constraints on a project. As an example, especially on larger and more complex
construction projects, we can develop a CPM schedule that integrates contractual limitations on work
during certain time periods, like environmental restrictions or winter weather.

A CPM schedule also enables the project team to prioritize the uncompleted work, based on the
activities’ total values, and to assign the available resources to complete the work in the most efficient
manner. It also allows us to:

Assign responsibility, costs, and resources to each of the project activities.

Forecast the expenditure of costs on an earned value basis.

Forecast the expenditure of hours, direct labor hours, over the course of the project.

Track whether we’re achieving those expected rates of production or earning of the contract amount.

Compared to a bar chart, a CPM schedule is a much more comprehensive tool that project teams can
use to plan and manage projects. I’ve worked on projects where I developed CPM schedules ranging
from 300 activities to 30,000 activities. The number of activities in your CPM schedule often comes
down to the level of detail you choose to represent, the project’s size, or its complexity.

Mark Nagata is a Director/Shareholder of TRAUNER and is an expert in the areas of critical path method
scheduling, delay and inefficiency analysis, and construction claim preparation and evaluation.

He loves to get questions at mark.nagata@traunerconsulting.com.

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11. BUDGET of CONSTRUCTION
What is the detailed procedure to establish the construction budget?
To establish a detailed construction budget, the following steps can be taken:
1. Define the scope of the project: Clearly outline the project's goals, objectives, and
requirements. This includes a detailed project description, design plans, and specifications.

2. Conduct a site survey: Inspect the construction site to identify any potential challenges or
issues that may affect the budget. This includes identifying any site-specific conditions that may
impact the cost, such as difficult soil conditions, severe weather, or other factors.

3. Research costs: Gather information on the cost of materials, labor, and equipment needed
for the project. This includes researching the costs of different materials and products, as well
as the cost of labor, equipment rental, and any other expenses that will be incurred during the
construction process.

4. Develop a preliminary budget: Use the information gathered to create an initial budget for
the project. This budget should include all of the costs associated with the project, including
materials, labor, equipment, and any other expenses.

5. Review and revise: Review the budget with stakeholders and make any necessary revisions
to ensure that the budget is accurate and realistic. This includes reviewing the budget with
architects, engineers, contractors, and other stakeholders, as well as making any necessary
adjustments to the budget based on their feedback.

6. Finalize the budget: Once the budget has been reviewed and revised, it can be finalized
and approved for use in the construction project. This includes obtaining the necessary
approvals and sign-offs from all stakeholders, and finalizing the budget in a format that can be
easily tracked and monitored throughout the construction process.
7. Establish a cost control system: it is important to establish a cost control system, which
can be used to track and monitor the budget throughout the construction process. This includes
setting up a system for tracking expenses, invoicing, and payments, as well as a system for
monitoring progress and identifying any potential issues or cost overruns.

8. Monitor and update regularly: Continuously monitor the budget and compare it against
actual costs incurred during the project. Regularly update the budget and implement necessary
changes to keep the project on track financially.
#Constructionbudget #budgeting #costcontrol

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11A. Construction budgets:
How do you ensure construction projects are completed on time, in full, and on
budget? It all starts with the budget itself.
Builders, laborers, and home renovators need to give clients and team members a
clear project plan, including costs. Same goes for landscapers, plumbers, and
really any contract work.
In this article, we’ll explore the construction budget basics, including what should
be included and why they matter so much. But first, a little story…
A quick story about Nick
Nick's superintendent for one of the largest construction companies in the US.
The conversation began with a complaint about recent project management
mistakes that had caused huge delays on a building site.

Nick and the project manager were dragged into the office to account for a
missing piece of equipment that led to thousands of dollars worth of losses. They
were berated for poor organization and budget management.
The whole thing was a mess.
But with better basic budget considerations, this fiasco could have been avoided.
Budget tracking - alongside a contingency budget for when costs run over - helps
keep the project plan on track. It keeps investors happy, contractors paid, and
ultimately helps you deliver a successful construction project.

Here’s what a good construction budget should include, and how to stay on
target.
What is a construction budget?
A construction budget lets you manage the funding and ‘profit-cost’ planning
related to your property development.

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Your project budget encompasses the cost of features like materials, labour and
official documentation. It strives to accurately estimate the entire expenditure of
the project from start to finish.

And without a good construction budget, it will prove difficult to get works off the
ground and completed on time.

Generally, stakeholders and investors require a detailed budget plan for your
construction costs prior to approving the project. Profits and overheads must be
clearly laid out in order to provide value and predicted return on investment.

The more accurate a budget is to true cost, the easier and faster project
completion will be. It is, however, important to remain flexible. Your construction
budget must allow breathing room for unexpected costs, including accidents,
breakages or inflation of materials. This was the downfall for Superintendent Nick
and his team on their most recent project.

Why is budgeting important for contractors?

Budgeting is one of the most integral initial steps for contractors undertaking
construction projects. It's not just a "cost plan" - your estimate affects a number
of key outcomes that rely on the overall success of the venture.
Good construction budgets make it easier to achieve several goals.
1. Work efficiently
Nobody likes delays. They impact cash flow, working capital, and ultimately the
bottom line.

But a good budget seamlessly integrates into the timeline and schedule of the
project. With key budget provisions and access to the right funding, capital is
unlikely to become a barrier to progress.

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To double down on making and tracking a realistic budget, a good productivity
software is recommended. Not only will this help measure how well you stick to
the budget, but you can also project final outcomes.
2. Keep costs in check
Your construction budget should consider all areas of expenses to give an
accurate and well-rounded view of the project. By planning out these costs in
advance, you come from a strong position to make sure they’re reasonable.

Pre-planned costs allow for a period of time to compare and contrast between
suppliers, manufacturers, even machinery producers. This way, you’re likely to get
“more bang for your buck” and exercise spend control to reduce expenses where
possible.

Inevitably, a lowered estimated cost with the same outcomes leads to higher
profits. So it pays to give yourself enough time to create a detailed construction
project budget. This also helps to keep clients happy with your service.

3. Report easily to clients

A traditional construction budget template can be confusing and too complex for
investors. In spite of this, your stakeholders will need to understand where the
money is going, and why.

Good budgets are clear budgets; in that they are transparent with both expenses
and timelines.

Spend management systems let you integrate and automate reporting based on
the data you’ve gathered. Avoid getting bogged down with budget research,
statistical analysis and confusing charts. This software allows you to consolidate
all the information in one place and present complex spending decisions in a
simple way.

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Realistically, many of us experience emergency costs that were not planned in the
budget. Luckily, Spendesk budgets even work with real-time updates so that,
when plans change, you can react accordingly and immediately.

What should be included in your construction budget?

While all jobs are different, there are a few common components that you’ll find
in most construction budgets.

1. Pre-construction costs
Before the work even begins, your project will incur some costs. That's the same
whether you buy a house or build one.

Unfortunate as this is, they should be fairly simple to plan for. Pre-construction
costs typically include the likes of 'soft costs' such as:
Architectural consultants
Land surveys or a quantity surveyor
Insurance
Taxes
To gather accurate information on the forecasted prices of these features, you
should work from historical data. There will be a number of online resources that
fit the distinctive nuances in your city and state.

Alternatively, to get a more authentic idea of the specific costs relating to your
project, why not make enquiries to compare different service providers? This way,
you can determine the best price and reduce your predicted overhead costs
immediately.

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2. Fixed expenses
Next, we consider the expenses related to the actual building work and
development, also known as the hard costs. This is likely to include equipment,
materials and labor costs.
Another aspect to consider is the land preparation costs. For example, are there
pre-existing buildings that require demolition?
Fortunately, experienced construction consultants often build relationships with
suppliers after repeated business. This opens the door to discounted or wholesale
prices for material costs, which can significantly decrease the budget allocations
in this area.
Savings in this area can accumulate throughout the budget plan in the form of
cost control. Alternatively, you could use the extra funds towards a better finish,
increasing the value of your property. Either way, it should lead to more money in
the pockets of all stakeholders.
Labor costs are fixed, but depend on the length of time each worker is required.
Delays to the project are likely to increase labor costs, with workers required for
more days and weeks than originally planned. On top of their salaries, you're
liable for vacation, medical and pension contributions. Alternatively, a clear,
detailed budget is likely to reduce the risk of delays and lead to savings in the
construction process.
Finally, you should bear in mind the financial logistics of the project. In terms of
payments, for example, you may benefit from using credit card payment options
for faster transactions and greater security, which means you should include any
processing fees in your budget. To ensure best practices and mitigate pitfalls
within budget control plans, you could check a contractor's guide to credit card
payments when preparing financially for your project.

3. Profit projections
A robust business budget includes revenue and profit predictions alongside
expense forecasts. The primary benefit of having this paper trail means that
there’s an easy explanation when extra costs arise. This creates a smoother

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overall process and should facilitate good synergy between contractors,
accountants and stakeholders.

Profit predictions usually fall under the responsibility of the construction project
manager. But, in Nick's case, it was clear that the superintendent position held
just as much of the liability.

As agonizing as it was for Nick, the construction industry is often plagued by the
types of problems that his team faced.

So, avoid the fiasco of missing equipment on your similar project by investing in
good budgeting software to regulate your construction budget and build real
estate success, every time.

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12. Zero-based budgeting (ZBB)?

Zero-based budgeting (ZBB) is a budgeting technique in which all expenses must be justified for
a new period or year starting from zero, versus starting with the previous budget and adjusting
it as needed.

ZBB is a highly effective business-planning tool to help a company identify and eliminate
unnecessary costs, keep control of your spending, and focus on high-profit initiatives.

Budgeting, including ZBB, is the tactical implementation of a company’s strategic plan. To

deliver the financial and operational goals in the strategic plan, an organization needs to
translate its long-range plan into a detailed set of expected revenues and expenses that can be
measured to track performance. These can be refined and adjusted along the way to keep the
company on track with its goals to achieve the desired business outcomes.

Above all, budgets enforce ownership and accountability so that financial decisions are made
sensibly. They help companies project profits, spot potential problems, and identify new
opportunities so that finance leaders can make the necessary adjustments.

Zero-based budgeting vs. traditional budgeting

Traditional budgeting Zero-based budgeting (ZBB)

Based on the previous year’s budget Started from scratch (zero base)

Based on previous expense levels Requires new expenditure justification

Cost accounting-oriented Decision-oriented

Justification is not typically required Cost and benefit justification required

Management decides on expenditures Line(s) of business management propose expenditu

Less clarity and responsiveness Greater clarity and responsiveness

Repetitive Thought-provoking

The typical budgeting process is translating a long-range strategy into annual operating plans
that are pushed down to finance, lines of business, and operations. This communicates the
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financial targets across the organization in every line of business. The targets can be financial
and operationally aligned. Some examples of this are revenue and expense budgets, R&D costs,
marketing expenses, project costs and revenues, and capital expenditures.

The budgeting process requires analyzing and comparing actual versus expected financial
performance to determine how to allocate expenditures for the organization to achieve the
budget targets set.

With traditional budgeting, the process of projecting your business’ revenue and expenses for
the upcoming year is typically based on your previous budget which is used to help predict,
analyze, and track revenues, expenses, profits, and cash flows. Traditional budgeting calls for
incremental increases over previous budgets, such as a 2% increase in spending, as opposed to
a justification of both old and new expenses, as called for with zero-based budgeting.
Traditional budgeting only analyzes new expenditures, while ZBB starts from zero and calls for a
justification of old, recurring expenses in addition to new expenditures.

Zero-based budgeting was developed in the 1970s by Pete Pyhrr, a former accounting manager
with Texas Instruments. The original goal of ZBB was to help organizations reduce costs and
promote fiscal responsibility.
With zero-based budgeting, the budget is started from scratch or a “zero base” each year. Using
this approach, every line of business within an organization is analyzed for its needs and costs
while ignoring historic spending. The key difference is justification: Zero-based budgets need to
review every expenditure at the beginning of the budget cycle, and lines of business have to
justify the need and impact of each line item before funding can be approved.

Each budget line item is reviewed without the influence of the last period’s actuals as a
baseline. Each item is carefully evaluated to determine if any programs, services, or activities
will be increased, maintained, reduced, or removed. Managers need to account for all elements
of the budget and identify cost-effective, relevant, and cost-saving areas.

ZBB can be applied to any type of cost: capital expenditures, operating expenses, research and
development (R&D) expenses, or even cost of goods sold (COGS).

Advantages of zero-based budgeting

ZBB has many advantages over traditional budgeting. It has a bad reputation for being a
complete cost cutting exercise, but ZBB an help you align spend to more revenue generating
opportunities. ZBB offers a number of advantages, including lower costs, budget flexibility, and
strategic execution. When every expense is carefully scrutinized, the highest revenue-
generating activities are prioritized. Expenses are often reduced because ZBB helps to prevent
the misallocation of resources that happens when a budget grows incrementally over time.

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Zero-based budgeting challenges
While ZBB can be an effective budgeting strategy, it can also be quite challenging to implement.
Since budgets are created from scratch, it’s much more time-consuming than traditional
budgeting. The unintended consequence of ZBB is that it can promote short-term cost savings
over long-term benefits. In an effort to minimize costs, some key expenses, such as research
and development or long-term strategic projects, may get overlooked.

Best practices for zero-based budgeting

Adopt a strategic approach

ZBB is more than just slashing costs. It’s a necessary step for freeing the resources and funds
needed for growth initiatives. Working with the line of business leaders, you can identify
overspending and reallocate those resources toward more strategic use.

Select the right planning platform

To reap the benefits of zero-based budgeting, modern planning and budgeting software is
essential. Cloud-based planning solutions that use AI and machine learning can help managers
make data-driven decisions to recommend the best path forward. A planning and budgeting
solution should not only be a blank canvas for modeling: it should also contain planning
intelligence and purpose-built capabilities for predictive planning, driver-based budgeting,
robust “what-if” scenario modeling, sandboxing, top-down and bottom-up budgeting, and
approvals and workflows as best practices that are readily available.

Embrace connected planning

Siloed, line of business planning might have sufficed before, but today the focus is
about connected and continuous planning across the enterprise. Disruption has become a
constant, and plans are now made to be changed, refined, and adjusted continuously.
Successful CFOs are partnering with sales, marketing, HR, and operations to make faster
decisions using connected, accurate, and timely information. In this new world, connected
enterprise planning is not just a best practice—it is a necessity.

Business benefits of ZBB

Zero-based budgeting can drive significant savings and efficiency, but it is much more than
simply building a budget from zero. ZBB is all about building and promoting a culture of cost
management and accountability. With profitability and cost management, narrative reporting,
and scenario modeling, ZBB allows your company to consider the highest priorities as opposed
to what has been done historically. With the cost savings that are discovered, business leaders

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13. 5 Feasibility Study in Construction
Contractors have to gain access to many elements just to ensure that construction projects can be carried out
and finished. Some of these elements include reliable employees, highly-maintained equipment pieces and
tools, and high-quality construction materials.

But one step that they should conduct first before acquiring these elements is to conduct a feasibility study. A
feasibility study in the construction industry pertains to a preliminary study that is typically done at the very
early stage of a construction project. This specific study aims to assess if a project is viable or doable, identify
varying feasible options, and help develop business cases and project plans.

Carrying out a feasibility study can ensure that the project will not waste time, money, and energy. To date,
there are five main aspects of a feasibility study that must be accounted for.

1. Technical Feasibility

Technical feasibility assesses if the proposed construction project can be done and finished without any
technical issues. This aspect of feasibility assesses the size of the project site, key access to the area, land
topography, geotechnical information, flooding risks, existing buildings or structures on the site, and other
environmental factors. Once these things are assessed, the consultants must then check the availability of
materials, labour, resources, and other practical requirements for the project.

2. Economic Feasibility

Economic feasibility, as its name implies, assesses the loss and profit considerations of a project. On this
aspect of the feasibility study, consultants have to carry out a cost-benefit analysis. A construction project is
said to be economically feasible if its profit can outweigh the overall project costs. Various advice and options
are then expected to be provided by the consultants to make the project economically feasible.

3. Legal Feasibility

Legal feasibility is an aspect of the feasibility study that talks about the legality of the proposed construction
project. Through legal feasibility, it confirms that a project will be constructed based on the current legal
state requirements and conditions. It likewise verifies that the project is free from any planning permission
woes, land ownership/easements, and taxation irregularities.

4. Operational Feasibility

Operational feasibility checks if the proposed plan for the project can solve any potential problems and
achieve the set goals. This aspect of the feasibility study takes a bigger picture of the whole project, ensuring
that the finished property can accomplish its true purpose. A school, for instance, should be able to function
optimally once it is done. The same thing should happen with houses, hospitals, and others.

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 5. Scheduling Feasibility

One final aspect of a feasibility study in the construction industry is scheduling feasibility. It primarily
estimates the amount of time needed to complete the project. Consultants would typically check the overall
design, materials, budget, environmental impacts, risk areas, and regulations to see if these factors can affect
the overall scheduling of the project. This aspect of feasibility likewise assesses the total number of months
or years needed to complete a project without affecting its quality.

To know more about feasibility studies, you can contact us at GHP. We are the leaders in architectural
planning and design projects in Australia.

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14. Procurement of Construction?
Procurement in construction involves the process of acquiring goods and services needed for a
construction project. It usually begins with the identification of need, followed by the selection of
contractors or suppliers (also known as vendors), negotiation of prices, and finally, the awarding of
contracts.

Related Reading: What Is A Contractor?

The procurement process is critical to the success of a construction project because it ensures all
necessary materials and services are obtained at the best possible price. A well-organised procurement
process can also help to speed up the overall construction timeline.

Types Of Procurement Methods In Construction

There are several different types of procurement methods used in construction, each with its own pros
and cons.

1. Single-Source Procurement

Single-source procurement is when a construction company procures all of their materials and services
from one supplier. This option is often used when the company has a good relationship with the supplier
and trusts them to provide quality materials and services.

Benefits of single-source procurement include:

Lower pricing, as all requirements are consolidated with one supplier

Consistent quality (or at least quality that meets expectations)

Faster purchasing times due to communication with a single supplier

Easier measurement of supplier performance.

2. Multiple-Source Procurement

As the name suggests, multiple-source procurement is a system in which construction companies

procure materials, goods and services from multiple suppliers. This option is often used when the
company wants to compare prices and quality before making a final procurement decision.

Distribution of risk is perhaps the biggest benefit of multiple-source procurement. By having a network
of multiple contractors/suppliers, you can spread risk and have a safety net should one of your supply
chain players run into difficulties.

Related Reading: Champions Guide To Winning Construction Contracts

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3. Two-Stage Tender

A two-stage tender is when a construction company first provides a list of requirements to potential
contractors or suppliers, who then submit their prices for the project.

After reviewing the prices, the construction company invites the most promising contractors/suppliers
to submit a more detailed proposal. This option is often used when the scope of work is complex and
the construction company wants a better idea of pricing before making a decision.

Related Reading: What Is A PQQ Tender In Construction?

For clients, two-stage tenders offer the benefit of involving contractors or suppliers as early as possible,
ensuring the “buildability” of a project. This also makes it possible for contractors/suppliers to start on
site earlier.

4. Selective Tendering

Selective tendering, also known as restrictive tendering, is when a construction company invites only
pre-qualified suppliers to submit bids for the project. This option is often used when the scope of work is
complex or sensitive and the company wants to limit the number of suppliers who have access to the
information.

Related Reading: How Do Contractors Get Clients? Guide To Getting More Work

Selective tendering is ideal for complex contracts where only a few firms can meet the client’s needs.
Limiting the number of bids also improves bid quality, saving both time and procurement costs.

5. Open Tendering

Open tendering is when a construction company invites any interested supplier to submit a bid for the
project. This option is often used when the scope of work is relatively simple and there are many
potential suppliers who could provide the necessary materials and services.

6. Negotiated Contracting

Negotiated contracting is when a construction company negotiates a contract directly with a supplier
without going through a formal bidding process. This option is often used when the scope of work is
complex or sensitive and the company wants to ensure they are getting the best possible price for the
project.

The best type of procurement in a construction project will depend on the specific needs of the project.
Ultimately, the goal for clients is to choose a method that will result in the best value for the project
while still meeting all other requirements.

Speed Up Procurement With Supply Chain Risk Management Compliance

It’s not unusual for buyer-based clients to spend several weeks researching contractors and suppliers
and waiting for responses from firms. There are no shortcuts to this process — clients must do their due
diligence when going through bids.

One way for contractors and suppliers to stand out from the competition is through accreditation and
verification schemes. At CHAS, we offer the Common Assessment Standard under CHAS Elite, the elite
standard of accreditation for contractors in the construction industry that covers 13 areas of risk

45
15. Contract Management of Construction and types of
Construction Contracts
What is Contract Management?

Contract Management at its best is about managing risk, and managing relationships. In a simple form, a
contract is a document describing a relationship between two parties, what each of them agrees to do,
and who carries the risk if things don’t turn out as planned. So simply put, contract management is
about defining resources, relationships, and risk.

Not necessarily managers of all levels are well-versed in effective contract management techniques.
Contract management can actually be a career–there’s even an International Association for Contract &
Commercial Management, the IACCM.

What is the use of Contract Management in Construction Projects?

An exhaustive construction contract can include up to ten different documents, all of which define
responsibilities and risks regarding different aspects of the project. Here are a few examples:

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A Construction Contract Agreement or construction contract management is between the general

contractor and owner or developer. Most contracts that define the basic project delivery system or
contractor agreement fall under the categories of:

Lump-sum or fixed-price contracts,

Cost-plus contracts,

Time and materials contracts

Guaranteed maximum price contracts.

A Scope or Statement of Work (SOW) spells out exactly who agrees to do what, and which techniques
and materials they’ll be using.

Project Duration or Construction Schedule, which may be updated as work progresses.

General Conditions, which breaks down shareholder rights and responsibilities and addresses how any
potential disputes would be settled.

Any construction project unfolds in phases: conception, design, pre-construction, construction

procurement (securing materials, equipment, and work teams), building, and delivery/post-
construction.

Contracts cover pretty much all of them and can be broken down into pre-award and post-award
contract development.

Once a bid has been accepted, work on a construction project begins. In complex projects, contract
changes are going to happen, and they’ll need to be managed by the construction management team.
Ideally, how this process takes place should already be spelled out in the original documentation.

Essential Elements of Successful Contract Management

46
It isn’t enough that an organization has professionals in place to handle construction contract
management. Employees must be augmented with the presence of processes and software companions
to satisfy increasing compliance and analytical needs. When a contract management strategy is
successfully implemented, organizations can expect to see:

The expected business benefits and financial returns are being realized.

The supplier is cooperative and responsive to the organization’s needs.

The organization encounters no contract disputes or surprises.

The delivery of services is satisfactory to both parties.

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Stages of Contract Management

Contracts play a significant role in the end-of-quarter crunch and are broken up into stages to organize
efforts and structure the typical contract process. When done manually, creating a contract can prove
quite time-consuming. The process in the stages of contract management includes several of the
following steps:

1. Initial requests. The contract management process begins by identifying contracts and pertinent
documents to support the contract’s purpose.

2. Authoring contracts. Writing a contract by hand is a time-consuming activity, but through the use of
automated contract management systems, the process can become quite streamlined.

3. Negotiating the contract. Upon completion of drafting the contract, employees should be able to
compare versions of the contract and note any discrepancies to reduce negotiation time.

4. Approving the contract. The instance in which most bottlenecks occur is getting management
approval. Users can pre-emptively combat this by creating tailored approval workflows, including
parallel and serial approvals to keep decisions moving at a rapid pace.

5. Execution of the contract. Executing the contract allows users to control and shorten the signature
process through the use of electronic signature and fax support.

6. Obligation management. This requires a great deal of project management to ensure deliverables are
being met by key stakeholders and the value of the contract isn’t deteriorating throughout its early
phases of growth.

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7. Revisions and amendments. Gathering all documents pertinent to the contract’s initial drafting is a
difficult task. When overlooked items are found, systems must be in place to amend the original
contract.

8. Auditing and reporting. Contract management does not simply entail drafting a contract and then
pushing it into the filing cabinet without another thought. Contract audits are important in determining
both organizations’ compliance with the terms of the agreement and any possible problems that might
arise.
47
9. Renewal. Using manual contract management methods can often result in missed renewal
opportunities and business revenue loss. Automating the process allows an organization to identify
renewal opportunities and create new contracts.

Much of contract management comes down to handling these nine steps. Contract lifecycle
management is critical. As different contract types go through their various stages, contract managers
need to monitor any potential changes or breaches of contract.

If an employee or business is unhappy with their contract, it might be worth making alterations to the
contract. It’s important to follow contractual obligations while also making sure both sides of the
contract are happy.

There are many times during the contract management process when lifecycle management becomes
important. Vendor performance and risk management are important considerations during the
management of contracts. For example, if a vendor fails to meet their contractual obligations, you may
need to rework the contract or enforce some disciplinary measure.

Types of Construction Contracts

Based on the various parameters following are the construction contracts followed in the construction
industry for proper implementation of construction contract management.

1. Unit Rate/ Unit Price Contract

Also called a Unit cost contract/item rate contract/ value contract /measurement contract or schedule
rate contract. In this type of construction contract management, the contractors are required to quote
rates for individual items of work on the basis of a schedule of quantities furnished by the owner.

This schedule indicates a full description of the item, estimate quantities, and their units. The
contractors are required to express rates and work out the cost against each item and thereby draw up
the total amount tendered for the work.

This type of contract is normally utilized where the quantity of work cannot be established such as civil
engineering construction projects where excavation of soil and rock are involved. The contractor is paid
based on the units that have been put in place and verified by the owner

2. Percentage Rate Contract

In this type of contract, the owner prepares a schedule of items with quantities rate units and the
amount shown therein. The contractors are required to offer percentages above, below, or at par with
the rates given in the schedule. The percentage quoted by the contractor is applicable to the overall
schedule.

Simply put, When the lowest rate and comparative position among the contractors are already specified
prior to the opening of the tender, then the percentage rate contract is used. A percentage contract is a
type of contract where there is no possibility of an unbalanced tender.

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48
3. Cost plus Percentage Contract.

This type of contract generally adopted when conditions are such that the rates of labor, material, etc.
are liable to fluctuate and there is an element of uncertainty in the scope of the work. In this type of
contract, there is an arrangement between the owner and the contractor by which the parties agree
that the work ordered would be completed and paid for on the basis of actual cost incurred plus a fixed
percentage as overhead and profit.

4. Time and materials Contracts.

A time and materials contract means the buyer pays for the time spent by the builder and his
subcontractors and must pay for the actual costs of construction materials. There is uncertainty involved
for the buyer here as well since the buyer has to pay for extra costs or time overruns. Many time and
materials contracts will contain maximum price clauses as well.

5. Lump-Sum Contract

Lump-sum or fixed-price contracts. Lump-sum contracts involve the buyer agreeing to pay a set price
and the contractor or builder agreeing to complete the project for that set price. With this type of
contract, the buyer has certainty because he knows what his final costs will be unless changes are made.

The builder or developer takes on the risk because if prices go up or problems arise, the buyer will not
have to pay any more money. Some lump-sum contracts include allowances, which can mitigate risk to
builders because if the buyer goes over the allowance, the cost is borne by the buyer.

Lump-sum contracts can sometimes include benefits or incentives for completing projects under budget
or in a shorter period of time, and can sometimes include liquidated damage clauses so the builder will
have to compensate the buyer for being late to finish.

6. EPC and Turnkey Contract

EPC Engineering, construction, and procurement is the prominent form of contracting agreement in the
construction industry. The engineering and construction contractor will carry out the detailed
engineering design of the project, procure all the equipment and materials necessary, and then
construct to deliver a functioning facility or asset to their clients.

A turnkey contract is a business arrangement in which a project is delivered in a completed state. Rather
than contracting with an owner to develop a project in stages, the developer is hired to finish the entire
project without owner input. The builder or developer is separate from the final owner or operator and
the project is turned over only once it is fully operational. In effect, the developer is finishing the project
and “tuning the key” to the new owner.

In EPC, the owner provides the basic engineering to the contractor and the constructor needs to
perform the detailed design based on the basic design received by them from the owner. Whereas in
Turnkey, the owner only provides certain technical specifications of the project and the contractor
needs to prepare all basic and detailed design of the project.

49
7. BOT ( Build, Operate, and Transfer) Contract

A type of contract between a private company and a government body, in which the private company
finances, design, construct, operate, and maintains an infrastructure project for a period of time and
then transfers the ownership of the project to the government. During this period the private party is
entitled to retain all revenues generated by the project and is the owner of the regarded facility.

The basic difference from the other conventional projects/ contract;

the returns are spread over a longer period

sound financial and engineering skills are warranted

no protection against any prices variation during the implementation period,

cost and time overrun upsets the returns.

Extension of time granted by authority does not provide much remedy.

8. Target Price Contract

In this contract type, the actual cost of completing the project is compared with a target cost previously
agreed. If the actual cost exceeds the target cost, some of the cost overrun will be borne by the
contractor (pain share) and the remainder by the owner in accordance with the agreed formula.

Similarly, if the actual cost is lower than the target cost, the contractor will be saving with the owner
again in accordance with a previously agreed formula (gain share). Such an approach helps t align the
interest of the parties since both will have an interest in working together in order to reduce the costs of
the projects.

Link: https://www.constructionplacements.com/construction-contract-management/
Types of Construction Contracts

1- Lumpsum Contract

In a lump sum contract, the engineer or/and contractor agrees to do the specified project for a fixed price.
Also called “fixed fee contracts,” these are often used for engineering ventures.
A lump sum or fixed fee contract is appropriate if the scope and schedule of the project are sufficiently
defined to allow the consulting engineer to estimate project costs.

2- Unit price Contract

A unit price contract is a type of construction contract based on estimated quantities of items included in the
project and their unit prices as initially estimated (rates may be hourly, the rate per unit work volume, etc.).
In general, the contractor’s overhead and profit are included in the rate. The final cost of the work depends
50
on the total quantity of items required to carry it out and complete it.

Unit price contracts are appropriate only for a project which involves well-known resources in quantities
which are unknown at the time of the agreement, and will be defined when the design and engineering or
construction work is finished.

A unit price agreement is one of the best choices for construction or supplier projects where the contract
documents can correctly identify the various kinds of items, but not the numbers that are needed.

It is not uncommon to combine a unit price contract with a lump sum contract or other types of agreement
for some parts of the project.

3 – Cost Plus Contract

This is a contract agreement wherein the purchaser agrees to pay the cost of all labor and materials, plus an
amount for contractor overhead and profit (usually stated as a percentage of the labor and material cost). In
construction, a cost-plus contract may be specified as:

Cost-Plus + Fixed Percentage

Cost-Plus + Fixed Fee
Cost-Plus + Fixed Fee With Guaranteed Maximum Price
Cost-Plus + Fixed Fee + Bonus
Cost-Plus + Fixed Fee With Guaranteed Maximum Price and Bonus
Cost-Plus + Fixed Fee With Agreement for Sharing Any Cost Savings
Cost-plus contracts are preferred when the scope of the work is indeterminate or highly uncertain and the
kinds of labor, material and equipment needed are also uncertain. Under this arrangement, complete records
must be maintained of all time and materials that the contractor spends on the work.

4 – Time Materials Contract

Contracts for time and materials (T&M) are a hybrid of fixed and cost-reimbursing contracts, and are used in
cases where there can be no clear scope of work: for example, if the number of hours that the client needs is
not clear. In this case, a set professional hourly rate is used (for instance, fees and costs). With this kind of
contract, it’s always a good idea to set a ceiling or a price that cannot be exceeded, to prevent being overrun
with heavy costs.

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15A. Top 10 skills for contract management.
Peter Sammons, Associate at Procurement Central is a procurement consultant

Recent research in the UK confirms something I think we all know. Most contract managers receive
very little direct training, and ironically, the CM arena should make training a priority but does not
always do so. Without better training we’re left with a casual approach to contract risk which
potentially leads to unplanned contract changes. These too often unnecessarily increase costs

The good news: organizations are now providing deeper training albeit there remain a number of
roadblocks to training. What do practitioners today consider the top capabilities for the rising
generation of contracts managers?

Top ten skills survey emphasize importance of soft skills

A survey in 2019 by Colin Linton, director of business training at consultancy firm Gidea Solutions
Limited, highlighted the top ten tools and skills that 130 procurement professionals considered essential
for performing quality modern professional contract management. The survey found that five* of the
ten top skills can be considered soft skills:2

1. Understanding contract terms and conditions (85%)

2. Negotiation tactics and planning (82%)
3. Influencing and persuading (76%)*
4. Risk management (73%)
5. Financial analysis (70%)
6. Handling conflicts and dispute resolution (66%)*
7. Managing internal stakeholders (65%)*
8. Understanding contract law (60%)
9. Creating a performance framework for suppliers (56%)*
10. Relationship management (55%)*
Soft skills - closing the professional skills gap

As Colin Linton commented: “Soft skills play a large part in how procurement professionals engage
internal stakeholders. If we want that ‘seat at the table’ we must be able to engage more effectively
internally with stakeholders.” 3

In just three years soft skills emerged as increasingly important to the profession of contract
management. Today’s professional contract managers rightly emphasize the growing importance of soft
skills.

And yet, by contrast, Linton’s seat at the table training objective is challenged by his research showing
that 82% of procurement professionals received no formal training when starting their first contract
manager role, despite the fact that 90% of these jobs involved managing contracts in excess of £1M
($1.3M in U.S dollars), but only 10% of these professionals had any specific, formal training.

52
The value of training – tackle skills gaps!

Companies need to plug the skills gaps. Ideally, they should work with procurement professionals to
develop active training plans. Both individual managers and large employers should take proactive
responsibility to ensure that the titular contract manager has the skills required to effectively lead the
contract.

Procurement Central, based in London,4 provides various courses in both the hard and soft skills. Steve
Wills CEO of Procurement Central comments, “most business people in their day-to-day activity are
directly or indirectly involved in contracts – whether selling or buying – yet few have any practical
training in what to do or how to read the signs of impending danger. Contract management remains a
neglected business discipline.”5

Skills in financial analysis are essential today

Financial analysis was not considered a core skill in the year 2017 to 2018, according to past surveys, but
was flagged by 70% of professionals as a core skill in 2019. Colin Linton believes the collapse of UK
construction giant Carillion in 2018 significantly impacted procurement professionals’ agendas – even
beyond Great Britain – and has become a leading push in today’s escalating attention to this area.

With the COVID-19 pandemic still reverberating and threatening throughout these challenging times,
companies are looking to all business functions to contribute positively towards profit and cash-flow.
Financial analysis skills – even at just a basic level -- are now crucial for any function, particularly for
helping to reduce costs.

Contract management is, of course, in part about risk management. Risks that buyers’ and sellers’
personnel deal with should include reviewing the finances of critical suppliers or customers. If these are
financially unstable -- or worse, if they go bust -- companies can get a good insight ahead of time
through financial analytics, and they can then take steps to minimize damage

Because companies are driven by profit and cash flow, contract managers must be more in tune with
finances. If we can demonstrate value by using smarter financial strategies we can potentially achieve
greater access to that proverbial top table. In turn that will enable us to better influence trading strategy
and so reduce risk – a virtuous circle!

What are the benefits of excellent contract management?

More than ever contract management must be sharp -- on top of it all -- to reduce risk and increase
certainty of gaining desired outcomes. A range of techniques, at strategic and at tactical levels enhance
contract management activity.

Therefore, let’s summarize these key benefits, so we can refocus our thinking. Contracts
need active management for four main reasons, all pointing to the need for awareness and future
planning strategies:

1. Business changes rapidly!

2. Things go wrong!
3. People lose interest or focus!
4. Audit trails are neglected!
53
Part of this will be controlled and influenced by plain, good, old-fashioned basic management! But if we
focus on those areas that are likely to go wrong then we can maximize our influence on outcomes.

You can analyse, understand and manage each of these areas better when you recognize what’s behind
these problem areas. More specifically:

· Cost increases and performance shortfalls are closely associated with value.

· Time delays can spawn delays further down the value-chain; delays can also cause on-costs
(additional costs other than salary) in subsidiary contracts (such as supplier subcontracts); and delays
can lead to further delays up the value-chain, such as contracts with key clients.

· Disasters happen from time to time, and we need to plan for them.

· Intellectual property rights (IPR) are increasingly important in this information-age. It is quite
possible to inadvertently (and innocently) infringe someone else’s rights, and using good management
practices can be a powerful defense against this risk.

Enough said! Some organizations may consider contract management to be a cost center and an
administrative burden to be avoided if possible. Perhaps, however, we should think of contract
management skills as a real value-driver, and an opportunity to grow the value of our projects and erase
risk (and unneeded cost) out of our business.

ABOUT THE AUTHOR

Peter Sammons, a regular trainer with Procurement Central, is a London-based specialist in strategic and
tactical purchasing skills transfer. The author of many books available online, Peter published Contact
Management, Core Business Competence in 2017.

END NOTES

1. Gidea Solutions Limited website

2. Soft skills are personal capabilities or techniques you use to work effectively and harmoniously with
other people.

3. Article in Supply Management online titled Top Ten Skills for Contract Management posted by Lucy
Patchett in Procurement, Risk, 7 September 2020

4. Procurement Central, London, training courses

5. Steve Wills’ quote in book titled Contract Management Core Business Competence, authored by
Peter Sammons

54
15B. Types of Construction Contracts.

1- Lumpsum Contract
In a lump sum contract, the engineer or/and contractor agrees to do the specified project for a fixed
price. Also called “fixed fee contracts,” these are often used for engineering ventures.
A lump sum or fixed fee contract is appropriate if the scope and schedule of the project are sufficiently
defined to allow the consulting engineer to estimate project costs.

2- Unit price Contract

A unit price contract is a type of construction contract based on estimated quantities of items included
in the project and their unit prices as initially estimated (rates may be hourly, the rate per unit work
volume, etc.). In general, the contractor’s overhead and profit are included in the rate. The final cost of
the work depends on the total quantity of items required to carry it out and complete it.
Unit price contracts are appropriate only for a project which involves well-known resources in quantities
which are unknown at the time of the agreement, and will be defined when the design and engineering
or construction work is finished.

3 – Cost Plus Contract

This is a contract agreement wherein the purchaser agrees to pay the cost of all labor and materials,
plus an amount for contractor overhead and profit (usually stated as a percentage of the labor and
material cost). In construction, a cost-plus contract may be specified as:
Cost-Plus + Fixed Percentage
Cost-Plus + Fixed Fee
Cost-Plus + Fixed Fee With Guaranteed Maximum Price
Cost-Plus + Fixed Fee + Bonus
Cost-Plus + Fixed Fee With Guaranteed Maximum Price and Bonus
Cost-Plus + Fixed Fee With Agreement for Sharing Any Cost Savings
Cost-plus contracts are preferred when the scope of the work is indeterminate or highly uncertain and
the kinds of labor, material and equipment needed are also uncertain. Under this arrangement,
complete records must be maintained of all time and materials that the contractor spends on the work.

4 – Time Materials Contract

Contracts for time and materials (T&M) are a hybrid of fixed and cost-reimbursing contracts, and are
used in cases where there can be no clear scope of work: for example, if the number of hours that the
client needs is not clear. In this case, a set professional hourly rate is used (for instance, fees and costs).
With this kind of contract, it’s always a good idea to set a ceiling or a price that cannot be exceeded, to
prevent being overrun with heavy costs.

16. FIDIC Contracts: A Beginner's Guide

FIDIC stands for the International Federation of Consulting Engineers, a global organization that
produces standard contracts for construction projects. FIDIC contracts provide a framework for
managing construction projects and define the roles and responsibilities of the parties involved.
In this comprehensive guide, we will provide an overview of FIDIC contracts, their different
55
types, structure, key provisions, administration, dispute resolution, and best practices for
successful implementation.

What You Need to Know

FIDIC contracts are widely used in the construction industry to provide a framework for
managing construction projects. FIDIC contracts are standard forms of contracts that are
recognized and used worldwide. FIDIC contracts are designed to be fair and balanced, ensuring
that all parties are treated equally. FIDIC contracts are divided into different categories,

The Different Types of FIDIC Contracts and Their Uses

FIDIC contracts are divided into different categories to suit different types of construction
projects.

The Red Book is the most commonly used FIDIC contract, and it is designed for construction
projects where the employer provides the design. This contract is suitable for projects where
the employer has a clear understanding of the project requirements and is capable of providing
a detailed design. The Red Book provides a fair and balanced framework for both the employer
and contractor to manage the project.

The Yellow Book is used for design-build projects, where the contractor is responsible for the
design and construction. This contract is suitable for projects where the contractor has the
expertise to provide the design and construction services. The Yellow Book allows for more
flexibility in the project, as the contractor has more control over the design and construction.

The Silver Book is used for turnkey projects, where the contractor is responsible for the entire
project, from design to construction to commissioning. This contract is suitable for projects
where the employer does not have the necessary expertise or resources to manage the project.
The Silver Book allows for the contractor to take on the full responsibility of the project and
provides a single point of responsibility for the employer

The Green Book: This contract is intended for use in short-term contracts, specifically for
operations and maintenance works. It covers the ongoing maintenance of an existing asset and
includes provisions for managing change orders, resolving disputes, and managing payments.

The White Book: This contract is meant for use in consultancy agreements, where the
consultant provides services such as feasibility studies, design, and project management. The
White Book sets out the terms of the consultancy agreement, including the scope of work, fees,
and deliverables.

Contract Structure: Understanding the Different Clauses and Sections:

FIDIC contracts are structured into different clauses and sections that outline the
responsibilities of each party. The contract begins with the preamble, which provides a general
overview of the project. The conditions of contract are then set out in the first section, which
56
includes general provisions, definitions, and interpretation. The second section sets out the
employer's requirements, while the third section outlines the contractor's obligations. The
fourth section covers the contract price, payment, and variation procedures, while the fifth
section deals with the provisions for time for completion, delay damages, and extension of
time. Finally, the sixth section deals with the procedures for testing, commissioning, and taking
over the works.

Contract Administration: Roles and Responsibilities of the Parties Involved:

FIDIC contracts define the roles and responsibilities of the parties involved in a construction
project. The employer is responsible for providing the design and the necessary approvals,
while the contractor is responsible for carrying out the works in accordance with the contract.
The engineer is appointed to administer the contract and certify the works, and the employer's
representative is appointed to ensure that the employer's requirements are met. The
contractor is also required to appoint a project manager to manage the construction works.

Key Provisions : Time, Cost, Quality, and Performance

FIDIC contracts include provisions for time, cost, quality, and performance. The contract sets
out the completion date, and the contractor is required to complete the works within that time.
The contract also sets out the contract price and payment procedures. The quality of the works
is also defined in the contract, and the contractor is required to carry out the works in
accordance with the contract documents. Finally, the contract includes provisions for
performance, and the contractor is required to ensure that the works meet the required
standards.

Dispute Resolution: A Step-by-Step Guide

Despite best efforts, disputes may arise during a construction project. FIDIC contracts include
provisions for dispute resolution, which include negotiations, adjudication, and arbitration. If
the dispute cannot be resolved through negotiation, the parties can refer the matter to an
adjudicator, whose decision is binding. If the adjudicator's decision is unsatisfactory, the parties
can then refer the matter to arbitration, where an arbitrator will make a final and binding
decision.

Variations and Claims: Procedures and Best Practices

Changes to the contract, also known as variations, may be necessary during a construction
project. FIDIC contracts include procedures for managing variations, which require the
employer to issue instructions for any changes to the works. The contractor is then required to
submit a variation proposal, which is subject to the engineer's approval. FIDIC contracts also
include provisions for claims, which are formal requests for compensation for any losses or
damages incurred during the project.

The Importance of Proper Record-Keeping:

57
Proper record-keeping is essential in FIDIC contracts, as it allows the parties to track the
progress of the project, manage variations and claims, and resolve disputes. FIDIC contracts
require the contractor to keep detailed records of the works, including correspondence,
drawings, and specifications. The engineer is also required to keep records of the works and
issue certificates of completion.

FIDIC and International Construction Law: Understanding the Legal Framework

FIDIC contracts are based on international construction law, and they are widely recognized and
used worldwide. FIDIC contracts are designed to be fair and balanced, ensuring that all parties
are treated equally. FIDIC contracts are also designed to be flexible, allowing for customization
to suit the specific needs of a project. Understanding the legal framework of FIDIC contracts is
essential for successfully implementing them.

Best Practices for Successfully Implementing FIDIC Contracts

FIDIC contracts are widely used in the construction industry to provide a framework for
managing construction projects. Understanding the different types of FIDIC contracts, their
structure, key provisions, administration, dispute resolution, and best practices for successful
implementation is essential for all parties involved in a construction project. By following best
practices and properly managing the contract, all parties can ensure that the project is
completed successfully, on time, and within budget.

[1] See FIDIC Website, available at: http://fidic.org/about-fidic

58
17. Claims Basic Knowledge.
Is an assertion of a party’s right under the terms of a contract or under law. In construction, this more
often than not comes down to either a right to additional time to complete the works or to additional
payment & is very often a combination of the two.

-Construction Project Parties:

•Employer
•Engineer/Consultant
•Contractor

-Dispute Resolution Methods:

•Avoidance
•Negotiation
•Mediation
•Dispute Adjudication Board
•Arbitration
•Litigation

-Types of Claims:
•Variations
•EOT
•Prolongation Costs
•Acceleration & Disruption
•Damages Under Law

-Interim & Final Claims:

In some cases the event to claim may not have ended or it may not be possible to ascertain final effects
when the prescribed period for the submission of the claim has expired.

Employer need to be made aware of the effects to enable them to plan for financial & time implications
on the project & to consider mitigation measures.

Many forms of contract require the claimant to provide interim information on predicted effects at
regular intervals on monthly updates until the final effects of claim can be ascertained, each submission
should be clearly designated as an interim or final claim.

-Contract Administration & Project Records:

The 3 most important aspects to a successful claim are ‘good records, good records & good records’

A potentially good case can be spoiled for the absence of adequate records.
The burden of the claimant is to prove his case on the balance of probability, The only way this may be
done is by reference to the project records.

-The Dispute Adjudication Boards:

59
Consists of a 1 or 3 persons.
The parties to keep abreast of events on the project & to be able to quickly provide an opinion or a
decision on matters concerning the Contract.

-Claim Submission:
•Selling Yourself
1-Writing Style
2-Document User-Friendly
3-Stand-Alone Document
4-Leading the Reviewer to a Logical Conclusion
5-Narrative to Explain Other Documents
6-Use of Exhibits & Additional Documents
7- Compilation of the Document

•Essential Elements of a Successful Claim Submission:

1. Cause
2. Effect
3. Entitlement
4. Substantiation

•Contents of a typical claim (submission document):

1. Front Cover
2. Executive Summary
3-Statement of Claim
4-Definitions, Abbreviations & Clarifications
5-Contract Particulars
6-Method of Delay Analysis
7-Details of the Claim for an EOT for Completion
8-Details of the Claim for Additional Payment
9-Appendices

-The Claim for Additional Payment:

It is common practice for contractors to link claims for additional payment for prolongation costs to
claims for EOT & present both as 1 single claim or 2 claims at the same time, but as separate and
discrete submissions.

Claim for additional payment in the case of prolongation may be categorized as follows:
1-Site costs (site staff, site establishment, transport, equipment, etc.)
2-Contractual costs (Insurances & Performance bonds)
3-Head office overheads & profit.
4-Finance

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18. Risk management in Construction.
An essential process that helps organizations identify & manage potential risks that could impact their
operations, finances & reputation.

●Risk Management

Process of identifying, assessing & prioritizing potential risks & implementing strategies to minimize their
impact.

It is an ongoing process that involves monitoring & re-evaluating risks as business operations change.

Goal of risk management is to minimize the negative impact of risk events and maximize the positive
outcomes of opportunities.

●Risk Types

-Pure risks are events that can only result in a loss or no change, such as natural disasters or theft.
-Speculative risks are events that can result in either a gain or a loss, such as investments or new product
launches.

●Identifying Risks

Done through a variety of methods, including brainstorming sessions, focus groups, and surveys.

●Assessing Risks

Once potential risks have been identified, the next step is to assess their likelihood and impact.
This information is used to prioritize risks & determine which ones require the most attention.
Factors such as the probability of a risk event occurring, the impact it would have on the organization & the
ability to manage or mitigate the risk should be considered when assessing risks.

●Developing Strategies to Mitigate Risks

-Risk transfer to another party (insurance or contracts)

-Reducing the likelihood of the risk event occurring
-Develop contingency plans to respond to the risk event if it does occur.

●Monitoring and Evaluating Risks

Review, update risk assessments, reassessing the effectiveness of risk mitigation strategies & implementing
new strategies as needed.
Organizations should also review their risk management plan in response to changes in the business
environment, such as new regulations or technological advancements.

●Documenting Risk Management Processes

61
Documentation provides a record of the organization’s risk management activities & helps to ensure that the
risk management plan is consistent & comprehensive.

●Importance of Communication in Risk Management

Organizations should establish clear lines of communication with employees, customers & stakeholders to
ensure that everyone is aware of the risk management plan & understands their role in implementing it.
Regular updates on risk management activities & status of risk mitigation strategies can also help to build
trust.

●Conclusion

Risk management is an essential process that helps organizations identify & manage potential risks that could
impact their operations, finances, and reputation.

By understanding risk types, identifying potential risks, assessing their likelihood & impact, developing
strategies to mitigate risks, monitoring & evaluating risks, documenting risk management processes, &
ensuring effective communication, organizations can minimize the negative impact of risk events and
maximize the positive

Source:

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18A. Contract Risk
Organizations make informed decisions on whether to get into a business contract & if so, what
measures should be taken in contract to minimize risk.

Contracts can expose your organization to:

•Financial risks
•Legal risks
•Compliance risks
•Operational risks

Failing to meet any of them can seriously damage business.

○Contract Risk Assessment

Process of identifying & evaluating potential risks associated with entering into a contractual
agreement with another party.

Involve reviewing contract conditions, identify potential risks associated with business,
assessing likelihood & potential impact of each risk & develop strategies to manage them.

Important for managing risk, ensure parties can enter into contracts more confidently &
reducing likelihood of disputes.

○Contract Risk Assessment Importance

Contract risk is assessed based on risk probability & consequence & defined as possibility of
some clause/term in a contract harming your organization.

○Assessment Checklist

1.Evaluate contract scope

Define obligation stipulated in contract, determine deadline to deliver them & review cost
requirement, Stipulated obligations are specific & all "gray areas" clarified.

2.Examine the delivery schedule

Dive into deadlines & how they can impact both contracting parties

3.Evaluate the terms

Dive into contract terms details, including pricing & payment, liabilities, warranties & dispute
63
resolution procedures.

4.Review risks associated with location-specific obligations

It's important to evaluate these risks & how they impact product quality, exchange rates, mode
of operations & more.

5.Research your contract partner

Doing business with a new partner comes with inherent risks. You want to avoid getting linked
to a business partner that has an undesirable track record.

6.Dive into your mandatory provisions

Every organization maintains a library containing a list of clauses that must be present in all
contracts. This can include nondisclosure, limited liability, payment terms, indemnification,
force majeure, etc.

7.Review optional provisions

Optional provisions may be included alongside mandatory provisions to give your organization
extra protection & advantage.

8.Identify high-risk clauses

Come with significant repercussions if breached. crucial to carefully scour contract to single
them out. Evaluate fairness of these clauses & renegotiate if necessary.

9.Consider general regulatory standards

Identify all organizational, industrial & federal standards applicable to your contract. Highlight
all the risks & penalties associated with breaching any of these regulations.

10. Track Changes

Contract risk assessment is a marathon, not a sprint. You have to consistently monitor changes
across each phase as every new activity can open up a new level of risk.

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65
19. BILL OF QUANTITIES (BOQ) Basic Knowledge.
What is bill of quantities (BOQ)
A bill of quantities (BOQ) is a document used in construction projects that lists the materials,
labor, and equipment required for a project and their costs. It is typically prepared by a quantity
surveyor and is used as a basis for tendering and contracts. It is also used as a reference
document throughout the project to track costs and changes.

What is the purpose of bill of quantities?

The BOQ is to provide a detailed and accurate list of the materials, labor, and equipment
required for a construction project, along with their estimated costs. The BOQ serves several
key functions in the construction process, including:
1. Tender and Contracts: BOQ is the basis for tendering and contracts. It provides detailed
information to potential contractors, allowing them to submit accurate and competitive bids.
2. Cost Estimation: BOQ helps to ensure that all necessary items are included in the project
and that the costs are accurate and reasonable.
3. Budget Control: BOQ serves as a reference document throughout the project, allowing the
project team to track costs and compare them to the budget.
4. Change Management: BOQ also helps to document any changes made to the project,
including variations, additional works, and omissions.
5. Facilitate Payment: BOQ also used to facilitate the payment process, the contractor can
submit invoices based on the completed work items in BOQ and the engineer can verify them
before making the payment.

Procedure preparing the bill of quantities ?

The procedure for preparing a bill of quantities (BOQ) typically involves the following steps:
1. Review the project documentation
2. Breakdown the project into smaller elements
3. Measure and quantify the elements
4. Prepare detailed BOQ
5. Review and validation
6. Revise and finalize
Overall, preparing a BOQ is a detailed and time-consuming process that requires a thorough
understanding of the project and its requirements, as well as the ability to accurately measure
and quantify the materials, labor, and equipment required.

Type of BOQ ?
There are several types of bills of quantities (BOQ) that can be used in construction projects,
including:
1. Elemental BOQ
2. Approximate BOQ
3. Bill of Quantities and Schedules (BOQS)
4. Activity BOQ
5. Functional BOQ
6. Unit rate BOQ
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Overall, the type of BOQ used in a construction project will depend on the specific
requirements of the project and the project team's needs and preference.

What are the software available to prepare the BOQ ?

Examples :
1. Quantity Takeoff (QTO) software
2. Construction management software
3. Spreadsheet software:
4. Cloud-based BOQ software
5. BIM (Building Information Modeling) software
Overall, the choice of software will depend on the specific requirements of the project, and the
preferences and capabilities of the project team.

67
19A. Bill of Quantities (BOQ).
The Bill of Quantities (BOQ) is a detailed document prepared by a quantity surveyor or estimator in the
construction industry. It lists and describes all the materials, quantities, and associated costs required
for a construction project. The BOQ is typically organized into different sections or trade packages and
includes a breakdown of the work to be done, the materials to be used, and the quantities of those
materials.

The main purpose of the BOQ is to provide comprehensive cost estimation for the project. It allows for
accurate budgeting, tendering, and procurement by specifying the quantities and types of materials
needed. The BOQ also helps in contract administration by serving as a basis for valuing the work done
during the construction process and facilitating progress payments and variations.

The quantities mentioned in the BOQ are derived from the project's construction drawings and
specifications. The quantity surveyor measures and calculates the quantities required for each item,
considering factors like wastage, overlaps, and allowances. Unit rates or prices for each item are
included in the BOQ, allowing for the estimation of the total cost for each item and the overall project.

Overall, the BOQ is a vital document in the construction industry, providing a detailed breakdown of
materials, quantities, and costs. It enables effective project management, and financial control, and
facilitates communication between various stakeholders involved in the construction project.

Bill of Quantities (BOQ): A detailed document prepared by a quantity surveyor that lists and describes all
the materials, quantities, and associated costs required for a construction project.

A Bill of Quantities (BOQ) is a comprehensive document prepared by a quantity surveyor or estimator in

the construction industry. It provides a detailed breakdown of all the materials, quantities, and
associated costs required for a construction project.

The BOQ is typically organized into different sections or trade packages, such as excavation, concrete
works, masonry, electrical, plumbing, etc. Each section includes a description of the work to be done,
the materials to be used, and the quantities of those materials.

The quantities mentioned in the BOQ are usually derived from the project's construction drawings and
specifications. The quantity surveyor carefully measures and calculates the quantities required for each
item, taking into account factors like wastage, overlaps, and allowances.

Along with the quantities, the BOQ also includes unit rates or prices for each item, which can be
obtained from market research or through consultation with suppliers and subcontractors. By
multiplying the quantities by the unit rates, the BOQ allows for the estimation of the total cost for each
item and the overall project.

68
The Bill of Quantities serves several purposes, including:

1. Cost estimation: It provides a detailed cost breakdown for the construction project, allowing for
accurate budgeting and tendering.

2. Procurement and tendering: The BOQ enables contractors and suppliers to understand the project's
requirements and submit competitive bids.

3. Contract administration: It forms a basis for valuing the work done during the construction process
and facilitates progress payments and variations.

4. Material and resource planning: The BOQ helps in determining the quantities and types of materials
needed for the project, aiding in procurement and logistics planning.

Overall, the Bill of Quantities is a crucial document in the construction industry, as it provides a clear and
comprehensive understanding of the project's scope, quantities, and costs, enabling effective project
management and financial control.

69
20. IPC: Interim Payment in Construction and How Does
it Work?

Construction contracts are often lengthy and notoriously complex with numerous parties and
contractors. Failure to receive appropriate payments throughout the course of construction agreements
is a long-held grievance by subcontractors.

If the construction project is set or estimated to take more than 45 days to complete, UK law requires a
mandatory interim or stage payment regime of partial remuneration for ongoing work. The schedule is
intended to help regulate the common predicament of delayed or non-payment in construction
contracts.

A payment regime must detail a process for identifying:

What payments are due

When payments are due
A procedure to apply for payment
A final date for payment
What notices must be served
These stage payments are called interim payments.

Interim payments are designed to protect subcontractors’ cash flow and operational efficiency.
Otherwise, subcontractors may have to wait many months on remuneration for completed or partially
completed work.

What Is an Interim Payment in Construction?

An interim payment is a stage payment or instalment paid by the main contractor, building owner or
developer to subcontractors under a construction contract.

Under Section 110(1) of the Housing Grants, Construction and Regeneration Act 1996, every
construction contract must provide a payment mechanism for determining what payments are due and
a final date for payment of any owed sum.

Construction contracts often regulate lengthy and complex projects.

The provision for interim payments allows subcontractors to receive compensation for work as it is
completed in stages rather than waiting until the job’s conclusion.

How Do Interim Payments Work?

Interim payments are designed to recompense subcontractors for work at intervals throughout the
project, so they don’t have to wait until the end before they receive any money.

The contract should detail a schedule for each interim payment, stipulate the due date, and a final date
for payment. The process for a subcontractor to apply for an interim payment — which the payee must
adhere to — should be detailed in the agreement, as should the formal response procedure from the
payer.
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Who Can Get an Interim Payment?

It would be reasonable to assume that interim payments are only required to be made to certain parties
identified within the agreement. However, interim payments are considered crucial to a subcontractor’s
ability to operate. Any party to the construction contract is entitled to interim or stage payments under
the legislation.

It is best practice for subcontractors to protect their interests by insisting on a payment schedule in the
agreement before they sign.

If a construction contract fails to provide for an adequate payment mechanism, then the Scheme for
Construction Contracts (England and Wales) Regulations 1998 shall apply as an implied term to create
interim payment rights.

When Can Interim Payments Be Requested?

Subcontractors can request interim payments in accordance with the timetable set out in the contract.
Because the payment schedule is enforceable at law, it’s crucial to negotiate favourable contract terms
and conditions before the parties agree to be bound by them.

When contract terms are absent or fall below the minimum statutory standard, the legislation provides
its own framework as follows:

A ‘relevant period’ triggering a subcontractor’s entitlement to an interim payment falls due every 28
days.

Each interim payment becomes due seven days after the end of the relevant period or seven days after
the contractor claims payment.

The final date for the interim payment is 17 days after the due date.

Payment timeframes devised by the main contractor and subcontractors are always subject to minimum
statutory standards to protect the interests of both parties.

How is an Interim Payment Requested?

The majority of construction contracts stipulate a payment application procedure from the payee. The
payee must follow the contract terms for the interim payment application to be valid.

Contract clauses should contain:

Valuation method

Criteria under which the contractor will make interim payments

Timing of payments

Any administrative or procedural requirements

The subcontractor will be required to provide a valuation of work completed by the specified date and
submit the application within the deadline determined by the agreement.

71
The application must set out the sum the subcontractor considers due and the basis of their calculation.
Typically, this includes a detailed breakdown of stage and/or labour and reimbursable expenses.

The subcontractor should follow the terminology and language of the contract when submitting their
application for an interim payment. Valuation is the precursor to the issue of an interim certificate that
authorises the interim payment.

Under the terms of the contract and in accordance with Section 110A of the Act, the Payer must also
submit a Payment Notice no less than five days after the due date for payment.

The Payment Notice must specify the sum and the basis upon which it has been calculated — even if the
sum due is zero.

The figure in the Payment Notice becomes the Notified Sum: the amount which must be paid on or
before the final date for payment.

How Long Does It Take to Receive an Interim Payment?

The timespan for receiving an interim payment depends upon if the main contractor accepts the
valuation of the works and the instalment amount the subcontractor has requested.

Payment should be in line with the specific contract terms and conditions. The only deviation should
occur if the two parties are in dispute or the contractor mistakenly relies on waiting for payment from
the building owner or developer first rather than making an interim payment application.

Conclusion

Before signing on the dotted line of any construction contract, protecting your business by negotiating
secure stage payments is essential. Taking expert legal advice is imperative to safeguard cash flow and
minimise risk.

The specialist construction team at Helix Law offers a dedicated service to preserve the interests of all
parties in construction contracts: both pre-agreement, whilst the project is ongoing and in the event of a
dispute.

Protect your interests and understand your options with prompt, professional advice. Contact Helix
today.

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22. Variance: How to Calculate Project Variance
A variance is defined as a schedule, technical, or cost deviation from the project plan. Variances should
be tracked and reported, as well as mitigated through corrective actions. There are two types of
variance which normally receive most of the attention:

Cost Variance

Schedule Variance

Calculating variances for an engineering project is an important step and requires the definition of
several variables:

BCWS, or Budgeted Cost of Work Scheduled, is the budgeted amount for each task at the specified point
of analysis (usually today).

BCWP, or Budgeted Cost of Work Performed, is the actual completion amount of each task relative to
the task budget.

ACWP, or Actual Cost of Work Performed, is the actual expenditure for each task.

And now, for the calculations:

Cost Variance (CV) is the amount that the project in a cost overrun or underrun position:

CV = BCWP – ACWP

Schedule Variance (SV) is the amount that the project is behind or ahead of schedule:

SV = BCWP – BCWS

Obviously, the cost is used as the base variable in the calculation for both cost and schedule variance,
which has caused some engineers to want to express them as a percentage:

CVP = CV / BCWP

SVP = SV / BCWS

However, the units of each variable does not have to be dollars. It can be hours, days, weeks, resource
depletion units, etc.

Example

Let’s say you are the project manager for the renovation of 3 hotel rooms. The tasks are as follows:

73
Preparation: Mar. 1-Mar. 10, $5,000

Room #1: Mar. 10-20, $10,000

Room #2: Mar. 15-25, $10,000

Room #3: Mar. 20-30, $10,000

Wrap-up: Mar. 25-31, $5,000

It’s Mar. 22 today. You figure you’re 100% complete on the preparation phase as well as Room #1, and
60% complete Room #2. Your receipts (plus timesheets, etc.) are showing $5,500 spent on preparation,
$8,900 on Room #1, and $5,500 on Room #2.

project variance example table

In this case, we have a schedule problem (SV is negative) but not a cost problem (CV is positive). The
project is behind schedule, but below budget relative to the tasks performed.

74
22. What is ‘price escalation’? or ‘Price Adjustment.
Price escalation is sometimes known as ‘cost escalation’ or ‘material price escalation’. It refers
to the sensitivity of construction contracts to the prices of materials and labour. In any fixed-
price contract, the impact of rising costs in the supply chain will have a direct consequential
impact on a contractor’s margin and cashflow. Under variable-price contracts, these are passed
on to the Employer, with similar effects.

It is unusual to see variable pricing in major international projects, in part because such projects
are typically dependent on financing from institutions. Often these institutions mandate the
contractual arrangements on projects they finance but, even if not the case, project finance is
generally based on detailed risk assessments that view open-ended, uncertain cost structures
unfavourably.

New ‘target cost’ contracts are hybridising these contract models to an extent, essentially by
providing a cost-reimbursable structure subject to a cap. Although these arrangements are
enjoying some success in smaller domestic projects, it remains to be seen whether such
arrangements will be used internationally.

As a result, all contract models are impacted by price escalation, but it is often contractors that
bear the brunt.

Risk or requirement?
Price escalation is usually managed like any other risk, by being allocated under the contract. In
the APAC region, as elsewhere, FIDIC is widely used for international contracts, in no small part
due to its favoured status with major international development agencies such as the World
Bank, International Monetary Fund, Asian Development Bank (ADB) and Japan International
Cooperation Agency (JICA). AIA and ENAA[1] forms are also commonly used, while there are a
wide variety of local standard form contracts.

The FIDIC and ENAA-influenced Standard Bidding Documents published by the World Bank, ADB
and JICA all contain model price escalation clauses or appendices, illustrating the ubiquity of
these clauses on major projects. However, whether these clauses are actually required to be
included is variable. For example, World Bank and ADB Procurement Guidelines require price
adjustment clauses in contracts longer than 18 months[2], whereas JICA Procurement
Guidelines only ‘generally recommend’ such clauses for contracts over 18 months[3].

75
Therefore, contractors may not be in a position to negotiate the inclusion of a price escalation
clause, particularly on shorter projects.

Local law is also a relevant consideration. Several APAC jurisdictions have laws impacting price
escalation, with varying degrees of force, application and specificity. It is beyond the scope of
this article to explore in depth, but at least a few Asian countries have laws that will require
price escalation in construction contracts, while several have mandatory guidelines to be
followed if price escalation is implemented. Some states limit their laws to contracts for public
works, but others do not. This highlights that local law should always be considered in
discussions of price escalation, including during tender, as the local law may override the
contract provisions and, therefore, affect core tendering assumptions.

General principles
Price escalation clauses can seem intimidating, particularly with explanatory notes making
reference to multiple coefficients (constants) and variables. For example, the World Bank’s
2021 Standard Bidding Documents[4] provide the formula:

Despite appearing complex, the fundamentals of this formula, and most price adjustment
clauses, can be explained as below:

The n in the above formula refers to a defined period. This is usually the relevant payment
period and so will typically be the month of the payment application. The o refers to the base
date. Therefore, it applies the difference between the base index and the current index to the
adjustable price element, bringing the contract price up in line with the change in the index (or
down, if de-escalation is permitted).

By referring to externally defined indices, there is no direct relationship to the actual costs
incurred. In this sense, price escalation clauses are similar to clauses providing for interest at a
defined rate: the purpose is not to be 100% accurate but only to provide a workable
methodology that will broadly address the risk.

76
The mathematics involved are, therefore, relatively straightforward but the output of any
formula is naturally dependent on the inputs which, although mathematical, are contractually
defined. Consequently, both contractual and commercial review are essential.

What needs to be considered?

Careful attention should be given to define key variables, such as:

• The base date and/or start date

• Triggers for applying the clause
• Any caps on price increases
• Any non-adjustable portion
• Cost elements and weightings
• The relevant reference indices
• Whether different formulae are required for different costs
• Currency variables, if needed
• Any provisions for price de-escalation
As highlighted by some of the items above, the price adjustment clause can directly define the
commercial success of the project for the contractor in an inflationary environment. As a prime
example, triggers for price adjustment often require a certain degree of increase before the
clause is engaged, while a cap may prevent any cost above a certain degree of increase being
passed on. This effectively creates a window of defined margin on certain core costs, and
allocates an open-ended risk above the cap.

Similarly, the non-adjustable portion is supposed to be a reflection of non-adjusting project

overheads. Over a long-term contract, mis-estimation of this portion could lead to significant
under-recovery.

Failing to properly consider key variables of the price adjustment formula can create
disadvantageous commercial restraints on the contractor. Proper expertise should be employed
in considering the price escalation clause, in line with other tendering assumptions. Modelling
the potential impact of price increases over time may also be appropriate.

Renewable energy projects, for example, are particularly vulnerable to supply constraints in
certain metals, with demand for those metals rapidly increasing as renewable energy targets
come into view between 2030 and 2050. Modelling forecasted supply and inflation scenarios,

77
and impacting the contract price via the draft price escalation clause, could prevent
unnecessary surprises.

Conclusion
In the current macroeconomic environment, contractors are increasingly concerned about how
to handle recent cost increases, which are unprecedented in the modern era. For contracts
without a price escalation clause, a detailed contract review may provide avenues to recover
certain costs under other headings such as change of law, force majeure, or the variation
procedures. Local law may also allow recovery, depending on the jurisdiction.

In severe circumstances, commercial negotiation may become a necessity if the contractor is in

risk of default, or if there are other risks to the project. Negotiated arrangements seen in
practice include new financing, allowing some of the contractor’s proven costs to be deducted
from liquidated delay damages, or new lump-sum contracts for work packages which are then
removed from the main contract. All of these options are fraught with legal and commercial
dangers and can bring further contentious issues if not handled carefully.

With a view to the future, including price escalation clauses in contracts may seem
disadvantageous to employers, as they are accepting the risk of increasing costs. However,
price escalation clauses allow contractors to bid more accurately and competitively, resulting in
lower bid prices for the employer. It also opens the door to price de-escalation, which would
favour the employer if deflationary trends prevail during the project.

Ultimately the most immediate benefit is that the project will not be endangered by contractor
defaults, or contractor delays related to procurement and delivery issues arising from cost
increases. In this regard, it should be borne in mind that the contractor’s delay is usually subject
to liquidated delay damages, whereas the employer’s delay liability to other contractors is
usually, at least theoretically, unlimited.

Although it may seem like a risk for employers to accept price escalation clauses, the current
and continuing uncertainty in global supply chains may cause havoc on future projects if not
appropriately provided for in the contract. In this respect, the certainty provided by price
escalation clauses has significant value in itself.

78
23. RATE ANALYSIS
WHAT IS RATE ANALYSIS?
Rate analysis is the basis for arriving at a correct rate per unit work or supply of work specifications such
as labor, materials, and equipment. It can also be defined as the analytical study that leads to the
definition of unit rates of work by identifying the basic requirements.

BENEFITS OF RATE ANALYSIS

There are two significant benefits for carrying out rate analysis of an item. The first is determining
the cost per unit item, while the second determines its economic processes and uses.

IMPORTANCE OF RATE ANALYSIS

Rate analysis gives a well-defined picture of tools, services, and machinery involved in the construction
of a project.

Rate analysis helps in proportioning the effect of the market on the payments made for construction
work. It also helps in determining the construction costs per unit as stipulated in the specifications. The
use of rate analysis makes it possible to come up with uniform standards for construction works.

CLOUD-BASED ESTIMATING ROI

SEE HOW MUCH YOU COULD SAVE WITH CLOUD-BASED ESTIMATING
HOW DO YOU CALCULATE RATE ANALYSIS?
Five factors play a pivotal role when calculating rate analysis. These are

• Material costs
• Labor costs
• Equipment costs
• Overheads
• Contractor profits

MATERIAL COSTS
When determining the material costs, you need to determine purchase prices, storage prices,
transportation costs, and wastages due to excesses. These rates are resolved from the current market
rates.

LABOR COSTS
When determining the labor costs, we determine the amount of labor required per unit measurement
of a construction project. The numbers are then multiplied by the relevant applicable wages to get the
labor costs per unit.

EQUIPMENT COSTS
There are different machinery employed in construction work. If machinery is used for construction
work, the cost will be added to the activity cost involved. For instance, we will add a concrete mixer to
the cost of preparation of concrete. However, if a machine is used for different types of work, a separate
budget is reserved for them.
79
OVERHEADS
The costs of overheads are also inclusive during rate analysis. These include office, rent, furniture,
wages, and contingencies. The charges are about 5% of the overall costs. Taxes are also included in
overheads as 6% of taxes have to be paid prior.

CONTRACTOR’S PROFIT
A contractor’s profit of about 10% is included in the overall costs in overall project cost. The profit is
about 8% in big projects and 15% in small projects.

RATE ANALYSIS
WHAT IS RATE ANALYSIS?
Rate analysis is the basis for arriving at a correct rate per unit work or supply of work specifications such as labor,
materials, and equipment. It can also be defined as the analytical study that leads to the definition of unit rates of
work by identifying the basic requirements.

BENEFITS OF RATE ANALYSIS

There are two significant benefits for carrying out rate analysis of an item. The first is determining the cost per unit
item, while the second determines its economic processes and uses.

IMPORTANCE OF RATE ANALYSIS

Rate analysis gives a well-defined picture of tools, services, and machinery involved in the construction of a
project.

Rate analysis helps in proportioning the effect of the market on the payments made for construction work. It also
helps in determining the construction costs per unit as stipulated in the specifications. The use of rate analysis
makes it possible to come up with uniform standards for construction works.

CLOUD-BASED ESTIMATING ROI

SEE HOW MUCH YOU COULD SAVE WITH CLOUD-BASED ESTIMATING

HOW DO YOU CALCULATE RATE ANALYSIS?

Five factors play a pivotal role when calculating rate analysis. These are

• Material costs
• Labor costs
• Equipment costs
• Overheads
• Contractor profits

MATERIAL COSTS
When determining the material costs, you need to determine purchase prices, storage prices, transportation costs,
and wastages due to excesses. These rates are resolved from the current market rates.

LABOR COSTS
When determining the labor costs, we determine the amount of labor required per unit measurement of a
construction project. The numbers are then multiplied by the relevant applicable wages to get the labor costs per
unit.
80
EQUIPMENT COSTS
There are different machinery employed in construction work. If machinery is used for construction work, the cost
will be added to the activity cost involved. For instance, we will add a concrete mixer to the cost of preparation of
concrete. However, if a machine is used for different types of work, a separate budget is reserved for them.

OVERHEADS
The costs of overheads are also inclusive during rate analysis. These include office, rent, furniture, wages, and
contingencies. The charges are about 5% of the overall costs. Taxes are also included in overheads as 6% of taxes
have to be paid prior.

CONTRACTOR’S PROFIT
A contractor’s profit of about 10% is included in the overall costs in overall project cost. The profit is about 8% in
big projects and 15% in small projects.

81
CONCRETE RATE ANALYSIS

For concrete rate analysis, we need first to organize the data we need for calculations. This includes materials,
steel, craft, shuttering charge, and water charge.

We will calculate the rate for 10m3 of concrete. The Cement: Sand and Aggregate ratio is 1:2:4, whereas the
density of cement is 1440kg/m3. Below is the detailed table with rate analysis calculations on concrete.

COMPONENT DESCRIPTION QUANTITY RATE IN $ TOTAL IN $

Materials

Aggregate 8.8m3 25 per m3 220

Cement 64 bags 3.5 per bag 224

Sand 4.4m3 24 per m3 108.6

Steel 785kg 0.44 per kg 345.4

Binding wires 1.5kg 0.65per kg 0.98

Labor

Mason (1st class) 4 5 per day 20

Mason (2nd class) 3 4 per day 12

Casual 12 3 per day 36

Blacksmith 8 3 per day 24

Formwork

Timber Lumpsum 10 10

Carpenters 10 2.8 per day 28

Wastage 6% 62

Transport 1% 10.3

Contractor’s Profit 15% 154.7

Total $1258.5

82
PLASTERING RATE ANALYSIS

Below we will calculate the plaster rate analysis for a 100m2 area. We will consider a 12mm thick plasterwork with
a cement to sand ratio of 1:4.

COMPONENT DESCRIPTION QUANTITY RATE IN $ TOTAL IN $

Labor

Mason (1st Class) 6.7 7 per day 47

Mason (2nd Class) 9.2 4 per day 37

Casual 7.5 4 per day 30

Material Cement 9 bags 2.8 per bag 25.2

Sand 1.25m3 8.5 per m3 10.6

Wastage 2% 0.716

Scaffolding 1% 0.358

Transport 1% 0.358

Miscellaneous 2% 0.716

Water charge 1% 0.358

Contractor’s profit 15% 5.4

Total 157.38

83
LABOR AND MATERIAL RATE ANALYSIS

The number of personnel and materials required in a project greatly influence the price of the project. The labor
and material units are multiplied by the relevant cost per unit to calculate the appropriate rates. Below is an
example of labor and material rate analysis in concrete and brickwork.

COMPONENT DESCRIPTION QUANTITY RATE IN $ TOTAL IN $

Materials

Class 1 bricks 2500 0.05 per brick 125

Class 2 bricks 2440 0.04 per brick 100

Brick ballast 6m3 8 per m3 48

Cement 64 bags 2.7 per bag 173

Steel 785 kg 0.44 per kg 345

Labor

1st class Mason 4 5 per day 20

2nd Class Mason 3 4 per day 12

Casual 12 3 per day 36

Carpenter 8 3 per day 24

Blacksmith 8 3 per day 24

Total 907

84
BRICKWORK RATE ANALYSIS

Below is the rate analysis for brickwork. We will consider a volume of 10m3 of brick for our calculations.

COMPONENT DESCRIPTION QUANTITY RATE IN $ TOTAL IN $

Labor

Mason (1st class) 6.7 7 per day 46.9

Mason (2nd Class) 6 5 per day 30

Casual 11 3.5 per day 38.5

Materials

Bricks 4940 0.05 247

Cement 21 Bags 2.8 58.8

Sand 2.8m3 8.5 23.8

Scaffolding 1% 3.29

Transport 1% 3.29

Miscellaneous 2% 6.59

Water charge 1% 3.29

Contractor’s profit 15% 49.44

Total 471.5

85
24. Variations in Construction
Variations are also called as change orders in construction. Any modification or change to works (agreed in
the contract) is treated as a variation. These modifications or changes can divide into three main categories.

1. Addition to the work agreed in the contract.

2. Omission to work agreed in the contract.
3. Substitution or alteration to work agreed in the contract.

But importantly, the contractor should agree to change the fundamental nature of the works. Also, the client
or consultant cannot omit and reward it to another contractor without the contractor agreeing to it.

FIDIC 1999 Clause 13- Variations and adjustments

According to FIDIC 1999, the engineer (client’s representative) can issue a variation order before issuing
Taking-over certificate. And also, the contractor is bound to carry out a variation instructed by the engineer
unless the contractor cannot obtain material required to carry out the works. As FIDIC 99 stated, The
Contractor should submit a prompt notice with supporting documents so the engineer can cancel or change
the variation instructions based on the presented evidence. The contractor cannot change of modified any
agreed works as per the contract without engineers approvals and instructions.
Therefore variations in construction might be (as per FIDIC 99),
1. Revisions to the design
2. Adjustment of the sequence of work
3. Adjustments to quality
4. Changes to levels, positions and dimensions of any part of the works
5. Changes to working conditions
6. Alterations to the quantities of any item of work ( may not always be treated as a variation)

Value engineering under variations in construction(by contractor)

As per the FIDIC 99 sub-clause 13.2, the contractor can submit a written value engineering proposal at any
time to,
1. Accelerate completion of the project
2. Reduce the cost project( Building cost, maintenance cost or operating cost of the project)
3. Improve the performance or value of the project
4. Any other benefit to the client

What is Variation procedure in the construction industry

Upon the engineer’s instruction to proceed for a variation the contractor can reply in writing stating the
reasons not to continue the variation or the contractor can submit,

1. Proper description and programme to execute the variation

2. Also, the contractor can propose alterations to the programme as per the sub-clause 8.3 [programme]
3. The contractor should submit a proper evaluation of the change order.

If the contractor provides a proposal according to sub-clause, 13.2 [value engineering] the engineer can reply
with approving, disapproving or commenting. But the contractor cannot delay any work until the engineers
respond. The engineer’s responsibility is to evaluate each variation following clause 12 [measurement and
evaluation-FIDIC 99]

86
24A. Variations:
Variations can impact different aspects of a construction project,
including.
In the context of construction projects, a variation refers to any change or modification made to
the original scope, design, or specifications of the project. Variations can arise due to various
reasons such as design changes, unforeseen site conditions, client requests, changes in
regulations, or any other factors that necessitate alterations to the original plans.

Variations can impact different aspects of a construction project, including:

1. Scope: Changes in the project's scope involve additions, deletions, or modifications to the
work that was initially planned. This could include adding new features, removing certain
elements, or changing the overall size or layout of the project.

2. Design: Design variations involve modifications to the architectural or engineering plans. This
may include alterations to the building layout, structural changes, revised material
specifications, or changes in finishes and aesthetics.

3. Specifications: Variations in specifications refer to changes in the technical requirements or

standards for the project. This could include using different materials, adjusting performance
criteria, or incorporating new technology or equipment.

4. Timeframe: Variations can also affect the project's schedule or timeline. Changes in the scope
or design may require additional time for planning, procurement, or construction activities.
Alternatively, variations could be implemented to accelerate the project schedule and reduce
the overall duration.

5. Costs: Variations often have cost implications. Changes in the project scope, design, or
specifications can impact the quantities of materials, labor requirements, or overall project
costs. Assessing the cost impact of variations is a crucial part of the variation management
process.

It's important to manage variations effectively to ensure that they are properly documented,
authorized, and communicated to all relevant stakeholders. This helps maintain clarity, control
costs, and ensure that the project continues to meet the desired objectives despite any changes
that may arise during its execution.

87
Variation order: A formal document issued by the quantity surveyor to authorize changes to
the scope, design, or specifications of a construction project, which may affect costs.

A variation order is a formal document issued by the quantity surveyor or the client's
representative to authorize changes to the scope, design, or specifications of a construction
project. It serves as a written instruction that outlines the modifications required and provides
authorization for implementing those changes.

Variation orders are typically issued when there is a need to alter the original plans, either due
to unforeseen circumstances, design modifications, client requests, or changes in regulatory
requirements. These changes may impact various aspects of the project, including its scope,
design, technical specifications, or materials.

The variation order is an essential tool for managing changes in construction projects. It helps
to ensure that all parties involved are aware of the modifications and provides a formal
mechanism for documenting and tracking the changes made throughout the project's lifecycle.

One of the significant aspects of a variation order is its impact on project costs. Changes
authorized through variation orders may lead to adjustments in the project's budget, as they
can affect the quantities of materials, labor requirements, or overall project scope. The quantity
surveyor assesses the cost implications of the proposed variations and includes them in the
variation order documentation.

88
26. Construction contingency?

Table of contents

What is construction contingency?

Types of construction contingencies

Contractor contingency

Owner contingency

How to use the contingency budget

Is contingency the same as retainage?

What is construction contingency?

A construction contingency is a part of a project's budget put aside to cover any unforseen costs, risks,
events, or changes in scope that may affect the project's cost over the course of its life. This money is on
reserve and is not allocated to any specific area of work. Essentially, the contingency acts as a sort of
insurance against other, unforeseen costs.

Determining the amount of contingency is a balancing act. On the one hand, it's a good idea to have
enough contingency funds to cover any uncertainties. On the other hand, it is important for business
need enough cash on hand to keep construction going. Most projects will use a rate of around 5-10% of
the total budget for contingencies.

Types of construction contingencies

There are two main types of construction contingency funds: contractor contingency and owner
contingency.

Contractor contingency
A contractor contingency is an amount built into the contractor's anticipated price for the project to
account for various risk factors that cannot otherwise be accounted for in a schedule of values.

This money is set aside to account for any errors that occur on behalf of the contractor. Accordingly,
contractors consider these funds spent money. Building this extra funding into an estimate is the
contractor accepting the fact that unpredictable costs are all part of the construction process.

Owner contingency
A project owner's reserve is an amount set aside for additions or modifications of the scope of the work.
These types of contingencies are used mainly in guaranteed maximum price (GMP) contracts.

89
Any changes not included in the initial bid will have to be paid by the owner-funded contingency.
Incomplete plans or owner-directed changes are the leading causes of dipping into an owner
contingency fund.

How to use the contingency budget

When encountering a construction contingency clause in your contract, it is essential to keep an eye out
for a few things. First, it should detail both the owner's contingency and the contractor's contingency.
They should list any and all predetermined costs that the contingency should be used for.

The list could include anything from incomplete designs, construction project delays, substitute
subcontractors, price increases, and any other number of unexpected costs. This is generally referred to
as the contingency budget.

The contingency budget should also include a well-drafted process of how to access contingency funds.
It's best to have a detailed procedure concerning notices, paperwork, and approvals.

The contingency budget should also prepare for unspent portions of the contingency fund. Are the
remaining funds shared among the contractor or subs as an incentive? Or does the money revert to the
one funding the contingency? It's a good idea to clarify how the contingency funds will be managed
from the jump. Otherwise, deciding how to manage unspent contingencies could create some
headaches.

Is contingency the same as retainage?

A construction contingency fund is not the same as retainage, but the concepts are similar. Both
retainage and contingency provide what are essentially "emergency" funds. When something on the
project goes awry and costs some extra money, paying to fix the issue may come from the contingency
fund, or it may come from the retainage being withheld from the contractor or subcontractor who
created the issue. Plus, retainage and contingency both represent about 5-10% of the construction
price.

However, retainage represents an amount of the contract price that has been earned but remains
withheld. It serves a purpose, but at the end of the day, it's payment owed that's being withheld.
Construction contingency, on the other hand, is actual inflation of the contract price to plan for the
unexpected. That, or it's funding set aside by the owner for the unexpected issues.

It might sound a bit like semantics, but that's a huge, fundamental difference between the two.
Retainage represents dollars earned and unpaid — and that amount could be the difference between a
construction business turning a healthy profit or losing money on a job. Contingency isn't owed to
anyone, and it could even turn into a positive if the contingency fund goes unused and gets dispersed to
project participants.

90
Material Present Market Price:

No Materials Name Brand Unit Present Present Market

Market Price Price with out
withTransport Transport

1 Cement Basundhara 1 Bag 530-550

2 Sand (River,M.Sand) Selhet CFT 60-65

3 Coarse Aggregate Dubai CFT

(20mm,40mm, etc)

5 Steel/Rebar BSRM Kg 90-100

6 Brick/Blocks Number-1 PCS 12-13

7 Add Mixture Litre 120

8 Tiles

9 Wood

10 Aluminium

91
Index

No. Name Page

1 Company Name & Contract (Basic).

2 20 Most Common Interview Questions and Best Answers (Basic).

3 Expart Quantity Surveyor Suggestion for Interview (Basic).

4 Quantity Surveyor 9 Secrets (Basic).

5 TOP 100 term to quantity surveyors definitions: (Basic).

6 Stress Strain Diagram (Basic).

7 Concre Grade (Basic).

8 Area Voliun Calculation (Basic).

9 Structural Components: (Basic).

10 BBS (Basic).

11 SFD & BMD Diagram (Basic).

12 Materials Test Name (Basic).

13 Grade of Steel (Basic).

14 Abrovision for Quantity Surveyor or Civil Engineer (Basic)

15 Unit Weight (Basic) (Cement, Steel, Concrete, RCC).

16 CLEAR COVER TO MAIN REINFORCEMENT (Basic).

17 WEIGHT OF ROD PER METER LENGTH (Basic).

18 DESIGN MIX (Basic).

19 WEIGHT OF ROD PER METER LENGTH (Basic).

20 DESIGN MIX (Basic).

21 CONVERSION FACTORS (Basic).

22 Estimation (Basic).

23 Former Interview Experience.

Software Basick Knowledge: Excel, Auto Cad, Planswieft, MS Project, Premavera
24
P6.
25

95
4. Top 100 term quantity surveyors definitions: (Basic).

No. Name Page

1 1. Quantity surveyor:

2 2. Cost estimation:

3 3. Bill of Quantities (BOQ):

4 4. Cost control:

5 5. Cost management:

6 6. Tender documentation:

7 7. Cost planning:

8 8. Value engineering:

9 9. Cash flow forecasting:

10 10. Life cycle costing

11 11. Variation order:

12 12. Final account:

13 13. Cost analysis:

14 14. Procurement:

15 15. Risk management:

16 16. Earned value analysis:

17 17. Cost database:

18 18. Cost-benefit analysis:

19 19. Depreciation

20 20. Feasibility study:

21 21. Cost overruns:

22 22. Quantity takeoff:

23 23. Cost estimating software:

96
24 24. Project management:

25 25. Measurement standards

26 26. Variation analysis:

27 27. Valuation:

28 28. Material takeoff

29 29. Preliminary costs:

30 30. Contingency budget:

31 31. Construction cost index:

32 32. Procurement strategy:

33 33. Cost forecasting:

34 34. Construction economics:

35 35. Measurement standards:

36 36. Benchmarking:

37 37. Dispute resolution:

38 38. Value for money (VFM):

39 39. Cost model:

40 40. Whole-life costing:

41 41. Inflation:

42 42. Asset management:

43 43. Quantity surveying software:

44 44. Cost reporting:

45 45. Life cycle assessment:

46 46. Subcontractor:

47 47. Insurance valuation:

48 48. Dilapidations:

49 49. Cash flow management:

50 50. Lifecycle analysis:

97
51 51. Preliminaries:

52 52. Construction contracts:

53 53. Tax depreciation:

54 54. Forensic quantity surveying:

55 55. Capital expenditure:

56 56. Feasibility cost planning:

57 57. Whole-life value:

58 58. Risk assessment:

59 59. Elemental cost analysis:

60 60. Cash flow statement:

61 61. Dilapidation survey:

62 62. Capital allowances:

63 63. Feasibility assessment:

64 64. Cost segregation:

65 65. Value management:

66 66. Quantity surveying standards:

67 67. Construction economics:

68 68. Life cycle assessment:

69 69. Cost Benchmarking:

70 70. Value engineering:

71 71. Cash flow analysis:

72 72. Building regulations:

73 73. Arbitration:

74 74. Retention:

75 75. Cash flow projection:

76 76. Soft costs:

77 77. Green building:

98
78 78. Due diligence:

79 79. Construction claims:

80 80. Benchmark cost:

81 81. Risk mitigation:

82 82. Lifecycle planning:

83 83. Construction claim management:

84 84. Plant and equipment:

85 85. Disbursement schedule:

86 86. Whole-life performance:

87 87. Construction cost management:

88 88. Capital budgeting:

89 89. Retrospective valuation:

90 90. Change order:

91 91. Valuation survey:

92 92. Final account reconciliation:

93 93. Cost-to-complete analysis:

94 94. Site investigation:

95 95. Quantity surveying ethics:

96 96. Cost indexation:

97 97. Material substitution:

98 98. Cost risk analysis:

99 99. Constructability review:

100. Quantity surveying professional
100
organizations:

99
1. Company Name & Contract:

NO. COMPANY NAME ORIGIN FOR QUANTITY SURVEYOR

1 World Bank sakib@adslbd.com
2 World Bank, DevConsultant. ataur73rahman@gmail.com
3 World Bank World Bank alip@strategi-consult.com
4
5 ADB (Javed Iqbal) jicbd@yahoo.com
ADB
6 ADB (Javed Iqbal) javedinternationalconsultants@gmai.com
7
8 career@remarkhb.com
Remark HB
9 hillolimran18@gmail.com
Amirica
10 LOUIS BERGER CONSULTING fdee.csc@wsp.com

9 TYPSA(Jollio) jmas@typsa.es
10 EPTISA Spain eptisa.robiul@gmail.com
11 Eptisa add. ddatta@eptisa.com
12 SUEZ France sheikh.shadi@suez.com
13 SMEC/ACE Consultant hrdbd@smec.com
14 SMEC/ACE Consultant CVBD@smec.com
15 SMEC Australia hr@smec-bd.com
16
17
18 Nippon Koei HR cv@nkbangladesh.co.bd
19 Tokyo Development tokyojobs101@gmail.com
20 Subornajurong hrdbd@surbanajurong.com
21 Toa Corporation toa_hr@toa-const.co.bd
22 JGC mislu.jdc.bd@gmail.com
23 Obaishi corporation khalek.khan@jamuna.otj-jv.com
kajima Corporation (Jahid Japan
24
G.Affirs) jahid-hasan@kajima.com.bd
info@newvision-bd.com,
New Vision ifwteam@newvision-bd.com,
tbhuiyan@newvision-bd.com
25 Takken info@tekkenbd.com

26 Gusan Sewarage project. ruhulaminmusa@yahoo.com

27 korean expressway ts.kundu27@gmail.com
28 ADB/World Bank Fund Korea highway.cheil@gmail.com
29 Samsung (Dhaka Air Port) dhaka.s1@samsung.com
Daewoo E&C (Rucelo Buscagan) qsdesign468@gmail.com

100
30
31 Young Consultant (YC) recruit98.yc@gmail.com
China Harbour (Dhaka office) hr@chec.com.bd
32 China Harbour (Dhaka office) checbd@chec.com.bd
China Harbour (Mirsorai) Anas anas.ctg.bd@gmail.com
China Harbour (Mirsorai)
Mahbub ce_mas@yahoo.com
33 China Machinari E&I Co. bdjobs realtahomina12@gmail.com
34 China Machinari E&I Co. ihaque770@gmail.com
Sichuan Road & Bridge Grop China
35
(SRBG) srbgprojectoffice@gmail.com
Sichuan Road & Bridge Grop
36
(SRBG) 2022srbgjv@sina.com
37 CCECC (Mirersorai WTP) employment@enlightenlimited.com
Xingxu construction Tween
38
Tower xingxuconstruction21@yahoo.com
Mirsorai employment@enlightenlimited.com
39
40 Srilonka bangladesh@sankenoverseas.com
41
42 DDC ddcrecruitment@ddclbd.com
DDC akhtar8820@yahoo.com
Deltadesh (Pvt.) Ltd. info@deltadesh.com
43 Prudential Consultant hr.prudentialjrs@gmail.com
Bright Design Consultants &
45
Const bright.hr@yahoo.com
46 GEM Consultant cv@gem.com.bd
GEM Consultant BD hosen.sazzad@gemcongroup.com
47 Engr. & planning Consultant Ltd Consultant partha@epc-bd.com
48 Sheltech Consultant Ltd. admin@scplbd.com
49 Sheltech Consultant Ltd. admi@scplbd.com
50 Prudential Consultant hr.prudentialjrs@gmail.com
int.recruitment.ttt@gmail.com
vcljobapply@gmail.com
SSPower resume@sspowerbd.com
51
Abdul Monem Ltd. talent@amlbd.com
Max Infrastructure (HR Asif
52
Sayed) asifsayeednil@gmail.com
Max Infrastructure (Qs Babor) BD babar.civil69@gmail.com
53 Tanvir construction Construction tcl.hr.ce22@gmail.com
Delta Engineers & Consortium deltaengineershr@gmail.com
54 Delta Engineers & Consortium careerconstruction.ctg@gmail.com
55 Khokan Construction Co. munif@kcelbd.com

101
56 The Civil Engineering Ltd hrd.ssac@gmail.com
57 BFEW hrd11@bfew.net
58 Summit power nilufarsharmin4931@gmail.com
59 Aksid corporation hr@aksidcorp.com
60 Aksid corporation careers@aksidcorp.com
61 NDE Engineering Ltd (Building) nazmul.hr@ndebd.com.bd
62 Marn Steel mmannan.hr@marnsteel.com
Bashundhara Group (Bitumen
63
field) hr@bogcl.com
64 PDL (Property Devel) (Pran RFL) mktg101@prangroup.com
United Group recruitment@united.com.bd
Azom Enterprise jahid.azamoverseas@gmail.com

65 Frelancer, upwork, fiverr. Frelance QS estimating.au@gmail.com

66 yashdhk@gmail.com
67 gethiredjobs99@gmail.com
68 1014775398@qq.com
69 tsp.hrd1@gmail.com
70 islam@signature11.com
71 tcel.ee.1977@gmail.com
72 career.bd@pleiades-group.com
73 hr@qbelbd.com
74 Sylhet Oil & Gas Trasmission Line bdtechnojobs@gmail.com
Mirersorai Economic Zone WTP employment@enlightenlimited.com
Materbari Deep Sea Port
(Shafique) qshafique@live.com
Paramount Group hdibd2019@gmail.com
Bengol Tigers Overses bakeebd71@gmail.com

76 DOM-INNO careeratdominno@gmail.com
77 DOM-INNO hrd@dominno-bd.com
78 Concord jobs@concordgroupbd.com
79 Concord Group concordtalentacquisition@gmail.com
80 Concord Group ruma_hr@concordgroupbd.com
81 EDISON REAL ESTATE hr.realestate@edison-bd.com
82 Starkwood Real State Ltd. jobssrel@gmail.com
BD Develop
83 p2pfamily career@p2pfamily.com
84 Bay developments hr@baydevelopments.com
85 SUVASTU hrd@suvastu.com
86 Finlayproperties hr@finlayproperties.com
87 Mazumderenterpris career@mazumderenterprise.com
88 Online Properties ltd. career.onlinegroup@gmail.com
89 bddl properties info@bddlproperties.com
102
 90 Innovera Holdings Ltd innoveraholdings.hr@gmail.com
91 Holy Apartment Ltd. holyapartmentsltd@gmail.com
92 Aristocrats Properties Ltd. aristocratsjobs@gmail.com
93 Next Space Ltd. hradmin@nextspaces.net
94 Samsul Alamin Real state Ltd. jobssagbd@gmail.com
95 SDL Engineering Private Ltd. sumaiya.wahab@sdleng.com
96 Online Properties ltd. a.rahman.civil@gmail.com
97 orientalgroupbd. cv@orientalgroupbd.com
98
99
100
Abdul Monem
Toma Construction tender@tcclbd.com
Monico info@monicoltd.com
Spectra Group contact@spectragroup.com.bd
Wahid Karim
Mir Akter Hossain
Property Development Ltd (PDL)
Max Group
Pobali Construcion
TCEL
NDE
ABC Construction
Confidence Group
United Group
Ellepse
Innovatiove

103
2. 20 Most Common Interview Questions and Best
Answers
1. Tell me about yourself.
2. What were your responsibilities?
3. What did you like or dislike about your previous job?

4. What were your starting and final levels of compensation?

5. What major challenges and problems did you face? How did you handle them?

6. What is your greatest strength?

7. What is your greatest weakness?
8. How do you handle stress and pressure?
9. Describe a difficult work situation or project and how you overcame it.

10. What was your biggest accomplishment (or failure) in this position?

11. How do you evaluate success?

12. Why are you leaving or have left your job?
13. Why do you want this job?
14. Why should we hire you?
15. What are your goals for the future?
16. What are your salary requirements?
17. Who was your best boss and who was the worst?
18. What are you passionate about?
19. Questions about your supervisors and co-workers.

20. Do you have any questions for me?

104
20 Most Common Interview Questions and Best
Answers.
Start with these questions you'll most likely be asked at a job interview, plus the best answers. Then review other
questions specifically related to the position, so you're prepared to ace the interview.

1. Tell me about yourself.

Example Answer
I’m an electrician with ten years of experience in residential construction. After earning my electrician’s certificate
at ABC Tech, I apprenticed with Jones Brothers, and then they hired me as a journeyman electrician. Four years
later I earned my certification as a master electrician.
More Answers: Interview Question: “Tell Me About Yourself”

2. What were your responsibilities?

Example Answer
As a special ed teacher, I’ve worked with grades K-6 at a large inner-city school, partnering with parents and other
teachers to design IEPs and support the inclusion of students with disabilities in regular classrooms.

More Answers: Job Interview Questions About Your Responsibilities

3. What did you like or dislike about your previous job?

Example Answer
I liked the progressive, staged training program my employer used to teach new hires the ins and outs of financial
services – there was always something new to learn, and we knew we would be steadily promoted as we became
more experienced. I didn’t like the commute, though, which is why I’m now applying for jobs closer to home.
More Answers: How to Answer Interview Questions About Your Previous Job
Watch Now: How to Answer 7 Tough Interview Questions

4. What were your starting and final levels of compensation?

Example Answer
When I started my entry-level job as an accountant, my annual salary was approximately $42K; I then became a
CPA and currently take home around $80K.
More Answers: Interview Questions About Your Salary History

5. What major challenges and problems did you face? How did you handle them?
Example Answer
When I was first hired as store manager, our turnover rate was 75% and we were chronically understaffed. I
implemented performance incentive programs that reduced attrition by 63% and significantly improved our talent
pipeline by focusing on internal training and promotion.
More Answers: Interview Question: How Did You Handle a Challenge?

6. What is your greatest strength?

Example Answer
My greatest strength is my ability to learn new processes quickly. When placed in a new environment, I actively
observe how other people do things so that I can easily pull my weight on the team. I’m also open to testing new
ways of doing things in order to optimize our efficiency.
More Answers: Interview Question: What is Your Greatest Strength?
105
7. What is your greatest weakness?
Example Answer
I’m an introvert, which I used to regard as being a weakness because I was always shy about reaching out to
people. However, part of being an introvert is that I’m a great listener, and I find this has really helped me as a
Help Desk Technician. I’m able to focus on our customers’ issues, ask the right questions to elicit information, and
resolve their tech issues.
More Answers: Interview Question: What is Your Greatest Weakness?

8. How do you handle stress and pressure?

Example Answer
I’m pretty good at recognizing when I’m beginning to feel stressed. When this happens, I take five minutes to focus
on my breathing. I also practice guided meditation in the morning before work for 30 minutes and exercise for an
hour in the evening. This keeps me on an even keel.
More Answers: Interview Question: How Do You Handle Stress?

9. Describe a difficult work situation or project and how you overcame it.
Example Answer
Our team, already understaffed, was thrown for a loop when a major customer demanded that we complete our
deliverables two weeks ahead of schedule. Normally we try to accommodate such requests, but this time it wasn’t
possible. I explained the situation to the client, and told them we could either charge those more to support the
cost of hiring a temp or, if they accepted the original deadline, we’d give them a 20% discount on their next order.
They opted for the latter.
More Answers: What Are the Most Difficult Decisions to Make?

10. What was your biggest accomplishment (or failure) in this position?
Example Answer
I’m most proud of having convinced our CEO to implement an internal training and promotion program that
allowed our personnel to steadily advance within our organization.

More Answers: Interview Questions: What Were Your Biggest Successes and Failures?

11. How do you evaluate success?

Example Answer
When I wake up each morning enthusiastic about going to work, then lock the clinic at night knowing that we’ve
made a difference in people’s lives, I figure the day has been a success.
More Answers: Job Interview Question: How Do You Define Success?

12. Why are you leaving or have left your job?

Example Answer
Our business was sold and, although I was invited to transition to the acquiring company, I decided that this was
the perfect opportunity for me to explore new career opportunities.
More Answers: Interview Question: Why Are You Looking For a New Job?

13. Why do you want this job?

Example Answer
From the time my appendix burst as a kid and I spent a week in the hospital, I’ve wanted to be a nurse – preferably
here at James Memorial. Although I went away for nursing school, I’m eager to move back home and care for our
local community now that I’ve become a licensed RN.
More Answers: Answer the Interview Question about Your Interest in a Job
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14. Why should we hire you?
Example Answer
I am a superb consultative salesperson, never failing to surpass my quotas and break prior personal sales records
because I truly enjoy working with customers to match them with the brands I know they’ll love as much as I do.
More Answers: Interview Question: Why Should We Hire You?

15. What are your goals for the future?

Example Answer
My goal is to sign on with a national retail organization where I can eventually advance to a role as a regional sales
manager.
More Answers: Interview Questions about Your Goals for the Future

16. What are your salary requirements?

Example Answer
I average around $39K annually, and I know from online salary calculators that the approximate salary here for
professionals with my experience ranges from $38K to $40K. But I’m open to negotiation, depending upon your
benefits package.

More Answers: Salary Negotiation Tips (How to Get a Better Offer)

17. Who was your best boss and who was the worst?
Example Answer
My best manager had an open-door policy where we were always welcome to speak to her privately about issues.
I’ve never had a bad manager. I’m not as comfortable with those who prefer to micromanage my work, but when
this happens I try to gain their trust so that they’ll feel more confident about giving me some autonomy.
More Answers: Job Interview Questions About Your Best and Worst Bosses

18. What are you passionate about?

Example Answer
I am passionate about folk music, and love to attend festivals during the summer. I also play fiddle with a local
band on the weekends.
More Answers: Interview Question: “What Are You Passionate About?”

19. Questions about your supervisors and co-workers.

Example Answer
I think I get along well with both my manager and my colleagues, because I approach everyone with respect. When
issues arise, I try to ask for clarification and find points of agreement we can use to resolve differences of opinion.
More Answers: Interview Questions about Co-Workers and Supervisors

20. Do you have any questions for me?

Example Answer
Do you have a formal schedule and mechanism for performance reviews? How soon after hiring would I receive
my first review?
More Answers: Best Questions to Ask in a Job Interview

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4. Quantity Surveyor 9 Secrets
Secret # (1)
Learn how to measure quantities from drawings
❖ Decide which takeoff tool are you going to use
করুন
❖Learn how to measure each item
❖ Understand the units of measurements D rate Windows

Secret # (2)
Learn how to develop a project scope and how to prepare a BOQ

❖ Know the BOQ divisions

❖ Understand the Items in each division
❖ Read the drawings carefully and don't miss any items in the BOQ

❖ Learn about the Prime Cost items (PC)

❖ Learn about the Provisional Sum items (PS)

Secret # (3)
Learn detailed cost estimation
❖ Difference between cost and price
❖ Basis of estimate
❖ Rate breakdown analysis
❖ Cost elements
❖ Materials
❖ Equipment
❖ Manpower
❖ Subcontractor
❖ Project allowances
❖ Project margins
❖ Contingencies
❖ Overheads
❖ Profits

109
Secret # (4)
Learn about contracts (Pre-contract review)
❖ Contract clauses
❖ Terms of payment
❖ Performance bond
❖ Advance payment
❖ Advance payment percentage
❖ Advance payment guarantee
❖ Advance payment recovery
❖ Retention
❖ Percentage
❖ Release

Secret # (5)
Learn about contracts (Post - contract works)
❖ Payments
❖ Variations
❖ Claims
❖ Other cost-related tasks

Secret # (6) গ োপন # (6)

Learn about procurement
❖ Request for proposals (RFP)
❖ Scope of work
❖ Types of subcontract agreements
❖ Purchase orders
❖ Vendor database
❖ Negotiations & Closing

Secret # (7)
Learn about time & quality not only cost
❖Planning & scheduling
❖Activities relationships
❖Cash flow
❖Difference between quality & grade
❖Cost of quality
❖Definition of quality

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Secret # (8)
Learn cost control & earned value management
❖What is cost control
❖Earned value
❖Earned value metrics
❖Budgeted cost of work scheduled
❖Budgeted cost of work performed
❖Actual cost of work performed
❖Cost performance index
❖Schedule performance index
❖Estimate to complete
❖Estimate at completion

Secret # (9
Learn about alternative dispute resolution
❖Arbitration
❖Mediation
❖Conciliation
❖Negotiation
❖Expert determination
❖Private judge
❖Mini trial

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CIVIL GURUJI
Quantity Surveyor Interview questions and answers
(Civil Engineers)

Question No 1-If you have to estimate a Building, what type of data do you need?
For this kind of question, you need to ready with the study for necessary data of preparing a Building Project-you
can say
· A project specification- Document which describe the quantity, type, nature, construction method and size of
construction work
· Project drawings- Architectural Drawing Includes The buildings for 2-D and 3-D
· Rates of materials- Usually to know the The average construction cost of home depend on the material cost.
that varies location wise.

Question No 2- Looking back on your last position, have you done your best work?
You should follow these Points to answer-
· You always had tried to do your best- Worked for the Company growth and that working capability is best of
your career right now.
· You are just having uplifted the company and your career stride- you tell them several factors. Then, recap
those factors due to your strongest qualifications.

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Question No 3- Which project were you involved in and what was your role in the project?
For this question- Never be negative. And answer honestly that your Job role as a quantity survey. You can follow
these points.
• How you preparing the Cash Flow statement- for all the activities including Bank Guarantees, Margin
money, Service taxes, Office expenditure, direct costs and material costs.
• Preparing client bills - the work done value every month.
• Verify-Certify Running account bills- of sub-contractors, machinery and work done bills.
• Reconciliation of materials- Determine wastage of materials.
• Rate analysis- How you had to prepare a budget and determine profit and loss statements up on
execution of the project.

Questions No 4-Where do you see yourself in 5 years and why?

Give answer in a Personal way-
• Tell them your Futuristic Vision who you would be
• You love doing adding skills in this field
• As you enjoy the quantity surveyor work
• You’ll dedicate yourself in this field for the Long time.
• You’re open to learning

Questions No 5- what is your targets and goals if you are hired?

Actually the hiring manager wants to know about your ambition as procurement professional. So, your answers
must be around the Following steps-
1. Speak your own thoughts here- move around the important qualities for the position.
2. Describe about the meaning and purpose of life- strong wish or a desire to achieve something that requires
immense hard work and dedication.
3. focus and match the company’s goals- aims and ambitions should be matched.
4. Describe long-term goals-involve growing with a company.

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Question No 6- What would you do if you made a Mistake during your position?
Tips for this question is-never ever lie because trying to cover up mistakes is never a good idea.
Say them that you’ll always Being Honest with them and will ensure appropriate action is taken.

প্রশ্ন নং 6- আপরন যরদ আপনাি অিস্থাণনি সময় একরে ভু ল কণিন র্ণি আপরন কী কিণিন?
এই প্রণশ্নি জনয রেপস হল-কখণনা রমথযা িলণিন না কািণ ভু ল ঢাকণর্ টচিা কিা কখনই ভাল ধািণা নয়।
র্াণদি িলুন টয আপরন সিদা
ব র্াণদি সাণথ সৎ থাকণিন এিং যথাযথ িযিস্থা টনওয়া হণয়ণি র্া রনর্ির্ কিণিন।

Question No 7- What are the contractual documents?

Tips for the answer of this question is following-
· Contractual documents include- items such as the design drawings, specification, work information, site
information and the program of works.
Quantity surveyor Interview question and answers- Technical questions
You already know companies are just looking for potential candidates. Quantity surveyor Interview questions and
answers Helps you face each type of civil engineering Interviews. Interviewer ask question to analyze your H. R
answers as well as technical background. It is always best to be honest in an interview. If you do not know an answer,
do not try to make something up – it is always better to just admit not knowing. So here are the best question that
are being asked in many quantity surveyor Interview, and you should know these.

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1. What is the size of Fine aggregate? (< 4,75 sieve, passing-ex-Sand )
2. Size of Coarse Aggregate- (> 4.74 mm sieve, Retain )
3. What do you mean by bulking? (the volume increase of fine aggregate due to presence of Moisture
Content in it)
4. Which cement is used for mainly building construction where strength required with age- (PPC)
5. Unit Weight of RCC (25Kn/cum)
6. Thickness of DPC – 50mm
7. Water to be used in concrete must have a PH value of? (6 to 8.5 )
8. What is BBS?-bar bending schedule meaning way to organizing rebar’s for structural unit, giving
detailed reinforcement requirement.
9. What is material statement?-it’s a Table showing quantity of materials required for a particular work.
For the Excavation, Brick work, R.C.C P.C.C and other
10. What is analysis of rates?-it’s a process in which overall cost of any item of work is determined per
unit quantity of work.

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5. TOP 100 term words related to quantity surveyors
along with their definitions:

1. Quantity surveyor:
A professional who specializes in estimating and managing the costs and quantities of materials, labor, and resources
required for construction projects.

2. Cost estimation:
The process of determining the anticipated costs of a construction project by considering factors such as materials,
labor, equipment, and overhead expenses.

3. Bill of Quantities (BOQ):

A detailed document prepared by a quantity surveyor that lists and describes all the materials, quantities, and
associated costs required for a construction project.

4. Cost control:
The management process of monitoring and regulating the costs of a construction project to ensure it stays within
the budget.

5. Cost management:
The overall process of planning, estimating, budgeting, and controlling costs throughout the lifecycle of a
construction project.

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6. Tender documentation:
The set of documents prepared by a quantity surveyor to invite bids from contractors, including drawings,
specifications, bills of quantities, and contractual terms.

7. Cost planning:
The process of establishing a budget and allocating costs to various elements of a construction project.

8. Value engineering:
A systematic approach to analyze and optimize the value of a project by balancing the cost, function, quality, and
aesthetics of its components.

9. Cash flow forecasting:

The estimation and monitoring of cash inflows and outflows throughout a construction project to ensure that
sufficient funds are available at the right time.

10. Life cycle costing:

A method of evaluating the total cost of a construction project over its entire life span, including initial construction,
operation, maintenance, and disposal.

11. Variation order:

A formal document issued by the quantity surveyor to authorize changes to the scope, design, or specifications of a
construction project, which may affect costs.

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12. Final account:
The comprehensive statement prepared by a quantity surveyor at the end of a construction project, detailing the
actual costs incurred and comparing them to the original budget.

13. Cost analysis:

The process of examining and breaking down the various components of a construction project's costs to understand
their individual contributions to the overall budget.

14. Procurement:
The process of acquiring materials, equipment, and services required for a construction project, including vendor
selection, negotiation, and contract management.

15. Risk management:

The systematic identification, assessment, and mitigation of potential risks and uncertainties that may impact the
cost, schedule, or quality of a construction project.

16. Earned value analysis:

A technique used by quantity surveyors to assess the progress and performance of a construction project by
comparing the budgeted cost of work performed to the actual cost.

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17. Cost database:
A repository of historical cost information maintained by quantity surveyors, used for reference and benchmarking
during the estimation and cost control processes.

18. Cost-benefit analysis:

A method of evaluating the financial feasibility of a construction project by comparing the anticipated benefits and
costs associated with its implementation.

19. Depreciation:
The decrease in value of an asset over time due to wear and tear, obsolescence, or other factors, which is considered
in the estimation of replacement costs.

20. Feasibility study:

A preliminary analysis conducted by quantity surveyors to assess the economic viability and potential risks of a
construction project before committing significant resources.

21. Cost overruns:

The situation where the actual costs of a construction project exceed the initially estimated or budgeted costs.

22. Quantity takeoff:

The process of quantifying and measuring the quantities of materials required for a construction project based on
the drawings and specifications.

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23. Cost estimating software:
Computer programs and tools used by quantity surveyors to facilitate the accurate and efficient estimation of
construction project costs.

24. Project management:

The discipline of planning, organizing, and controlling resources to achieve specific objectives within the constraints
of time, budget, and quality for a construction project.

25. Measurement standards:

Established guidelines and rules that dictate how quantities of materials and work items are measured and
documented in the bills of quantities.

26. Variation analysis:

The examination of differences between the estimated costs and the actual costs incurred during a construction
project, with a focus on identifying and explaining discrepancies.

27. Valuation:
The process of determining the monetary value of a construction project or its components, often required for
insurance, taxation, or financial reporting purposes.

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28. Material takeoff:
The process of quantifying and listing the quantities of specific materials required for a construction project, typically
based on the bill of quantities.

29. Preliminary costs:

The initial expenses incurred during the early stages of a construction project, including feasibility studies, surveys,
design development, and site investigation.

30. Contingency budget:

A reserve fund allocated by a quantity surveyor to account for unforeseen events or risks that may impact the costs
of a construction project.

31. Construction cost index:

An indicator that tracks the changes in construction costs over time, allowing quantity surveyors to adjust their
estimates based on prevailing market conditions.

32. Procurement strategy:

The planned approach and methodology used by quantity surveyors to procure the necessary resources for a
construction project, considering factors such as time, cost, and risk.

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33. Cost forecasting:
The process of predicting and projecting the future costs of a construction project based on historical data, current
trends, and anticipated changes.

34. Construction economics:

The branch of economics that focuses on the analysis and management of costs, resources, and financial aspects
within the construction industry.

35. Cost-plus contract:

A type of construction contract where the contractor is reimbursed for the actual costs incurred plus a
predetermined percentage or fee to cover profit and overhead.

36. Benchmarking:
The process of comparing the performance, costs, or practices of a construction project to industry standards or
similar projects to identify areas for improvement.

37. Dispute resolution:

The process of resolving conflicts and disagreements that may arise between parties involved in a construction
project, often facilitated by a quantity surveyor or other professionals.

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38. Value for money (VFM):
The concept of obtaining the best possible outcome and benefits from the resources invested in a construction
project, considering both cost and quality.

39. Cost model:

A structured framework or template used by quantity surveyors to organize and estimate the costs of various
elements and activities within a construction project.

40. Whole-life costing:

A method of evaluating and considering the total costs associated with a construction project over its entire life
cycle, including design, construction, operation, and maintenance.

41. Inflation:
The general increase in prices of goods and services over time, which quantity surveyors must account for when
estimating and managing construction project costs.

42. Asset management:

The strategic and systematic approach to managing and maintaining the physical assets of a construction project
throughout their lifecycle to optimize performance and value.

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43. Quantity surveying software:
Computer programs and tools specifically designed for quantity surveyors to assist in tasks such as cost estimation,
measurement, and project management.

44. Cost reporting:

The regular preparation and presentation of financial reports by quantity surveyors to communicate the current
status, progress, and financial performance of a construction project.

45. Life cycle assessment:

The comprehensive evaluation of the environmental impacts and sustainability considerations associated with a
construction project from cradle to grave.

46. Subcontractor:
A company or individual hired by the main contractor to perform specific tasks or provide specialized services within
a construction project.

47. Insurance valuation:

The assessment and determination of the reinstatement or replacement value of a construction project for insurance
purposes, taking into account construction costs and market conditions.

124
48. Dilapidations:
The assessment and estimation of the repairs and maintenance required to restore a property to its original
condition, often performed by a quantity surveyor during lease agreements.

49. Cash flow management:

The process of monitoring and optimizing the inflow and outflow of cash within a construction project to ensure
sufficient liquidity for ongoing operations.

50. Lifecycle analysis:

The systematic evaluation of the environmental impacts and resource usage associated with a construction project
from raw material extraction to end-of-life disposal.

51. Preliminaries:
The costs and allowances in a construction project that are not directly related to specific materials or work items,
including site supervision, temporary works, site facilities, and general administration.

52. Construction contracts:

Legally binding agreements that define the roles, responsibilities, and obligations of parties involved in a
construction project, including the client, contractor, and quantity surveyor.

125
53. Tax depreciation:
The method used to account for the decrease in value of an asset for tax purposes, allowing for deductions over its
useful life.

54. Forensic quantity surveying:

The application of quantity surveying expertise in the investigation, analysis, and resolution of disputes, claims, or
legal issues related to construction projects.

55. Capital expenditure:

The costs incurred for the acquisition, improvement, or expansion of long-term assets in a construction project,
typically depreciated over their useful life.

56. Feasibility cost planning:

The initial estimation of construction costs during the feasibility stage of a project to assess its financial viability and
inform decision-making.

57. Whole-life value:

The assessment of a construction project's value over its entire life cycle, considering not only its initial costs but
also its operational, maintenance, and disposal costs, as well as benefits.

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58. Risk assessment:
The process of identifying, analyzing, and evaluating potential risks and uncertainties that may affect the successful
completion of a construction project and its associated costs.

59. Elemental cost analysis:

The method of breaking down the overall cost of a construction project into various elements or components,
enabling detailed analysis and cost control.

60. Cash flow statement:

A financial statement that presents the inflow and outflow of cash within a construction project over a specified
period, providing insights into liquidity and financial health.

61. Dilapidation survey:

An inspection conducted by a quantity surveyor to assess the condition of a property before and after a lease
agreement, documenting any damages or required repairs.

62. Capital allowances:

Tax deductions or allowances provided for capital expenditure on construction projects, allowing for tax relief on
qualifying assets.

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63. Feasibility assessment:
An evaluation conducted by a quantity surveyor to determine the economic viability and potential risks of a
construction project, considering factors such as costs, benefits, and market conditions.

64. Cost segregation:

The process of segregating and classifying construction costs into different categories, such as land, building, fixtures,
and equipment, for accounting and tax purposes.

65. Value management:

A structured and collaborative approach to identify and achieve value improvements in a construction project,
considering the needs and expectations of stakeholders.

66. Quantity surveying standards:

Established guidelines and principles that govern the professional practice and conduct of quantity surveyors,
ensuring consistency and quality in their work.

67. Construction economics:

The application of economic principles and theories to analyze and understand the financial aspects of construction
projects, including supply and demand, pricing, and investment decisions.

128
68. Life cycle assessment:
The evaluation of the environmental impact of a construction project throughout its life cycle, considering factors
such as energy consumption, waste generation, and carbon emissions.

69. Cost Benchmarking:

The process of comparing the costs and performance of a construction project to industry benchmarks or similar
projects to identify areas of improvement or potential cost savings.

70. Value engineering:

A systematic approach to analyze and optimize the value of a construction project by balancing the cost, function,
quality, and aesthetics of its components.

71. Cash flow analysis:

The examination and projection of the inflows and outflows of cash within a construction project to assess liquidity,
funding requirements, and financial performance.

72. Building regulations:

Governmental rules and standards that prescribe the minimum requirements for the design, construction, and
operation of buildings to ensure safety, health, and welfare.

129
73. Arbitration:
A method of dispute resolution in which parties involved in a construction project submit their case to an arbitrator
or a panel for a binding decision, often used as an alternative to litigation.

74. Retention:
An agreed-upon percentage of the contract sum withheld by the client from the contractor's payment as a form of
security until the completion of the construction project.

75. Cash flow projection:

A forward-looking estimation of the anticipated inflows and outflows of cash within a construction project over a
specified period, used for planning and budgeting purposes.

76. Soft costs:

Non-physical costs associated with a construction project that are not directly attributable to materials or labor,
such as professional fees, permits, surveys, and marketing expenses.

77. Green building:

The design, construction, and operation of buildings that minimize their environmental impact, conserve resources
and enhance occupant health and comfort.

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78. Due diligence:
The comprehensive and systematic investigation conducted by a quantity surveyor to assess the financial, legal, and
technical aspects of a construction project before making decisions or recommendations.

79. Construction claims:

Requests for additional compensation or time extensions submitted by contractors or subcontractors due to events
or circumstances that impact the cost or schedule of a construction project.

80. Benchmark cost:

The target or reference cost established by a quantity surveyor based on historical data, industry standards, or
similar projects, used for comparison and evaluation purposes.

81. Risk mitigation:

The implementation of strategies and measures to reduce or eliminate potential risks and uncertainties that may
impact the costs or success of a construction project.

82. Lifecycle planning:

The process of considering the long-term operational, maintenance, and replacement costs of a construction project
during the initial planning and design stages.

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83. Construction claim management:
The systematic and proactive approach to handle and resolve construction claims, ensuring fair and equitable
outcomes while minimizing delays and disruptions.

84. Plant and equipment:

The machinery, tools, and other assets used in the construction process, often rented or owned by contractors and
accounted for in the estimation and management of project costs.

85. Disbursement schedule:

A structured plan that outlines the anticipated timing and amounts of cash outflows for a construction project, often
used for financial planning and tracking.

86. Whole-life performance:

The assessment of a construction project's performance and functionality over its entire life cycle, considering
factors such as energy efficiency, durability, and maintenance requirements.

87. Construction cost management:

The systematic control and monitoring of costs throughout the lifecycle of a construction project, including
estimation, budgeting, tracking, and analysis.

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88. Capital budgeting:
The process of evaluating and allocating financial resources to capital expenditure projects, including construction
projects, based on their anticipated returns and risks.

89. Retrospective valuation:

The assessment of the value of a completed construction project at a specific point in time, often required for
financial reporting, refinancing, or sale purposes.

90. Change order:

A documented modification to the original contract of a construction project, issued by a quantity surveyor,
specifying changes in scope, design, cost, or schedule.

91. Valuation survey:

An inspection conducted by a quantity surveyor to determine the value of a property or asset, considering factors
such as location, condition, size, and market trends.

92. Final account reconciliation:

The process of comparing the actual costs incurred during a construction project to the estimated costs in the final
account, identifying any discrepancies or variances.

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93. Cost-to-complete analysis:
An assessment conducted by a quantity surveyor to determine the remaining costs required to complete a
construction project based on the progress and incurred expenses.

94. Site investigation:

The assessment and evaluation of a construction site's geotechnical conditions, environmental factors, and other
site-specific information to inform the estimation and management of costs.

95. Quantity surveying ethics:

The moral principles and professional standards that guide the conduct and behavior of quantity surveyors, ensuring
integrity, objectivity, and accountability in their work.

96. Cost indexation:

The adjustment of construction project costs to account for changes in the general price level of goods and services,
typically using an inflation index.

97. Material substitution:

The process of replacing specified materials in a construction project with alternative materials that offer similar
functionality but may have different costs or environmental impacts.

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98. Cost risk analysis:
The assessment and quantification of potential cost uncertainties and their impact on a construction project, often
performed through techniques such as sensitivity analysis or Monte Carlo simulation.

99. Constructability review:

A systematic evaluation conducted by a quantity surveyor to assess the constructability and efficiency of the design
of a construction project, identifying potential cost-saving opportunities.

100. Quantity surveying professional organizations:

Associations and institutes that represent quantity surveyors, providing resources, guidance, and professional
development opportunities for members.

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6. Stress Strain Diagram:

7. Concre Grade:

136
8. Area Voliun Calculation:

137
9. Structural Components:

139
140
141
10. BBS

142
11. SFD & BMD

143
12. Materials Test Name:
1. Cement.
2. Sand (River,M.Sand).
3. Coarse Aggregate (20mm, 40mm, etc).
4. Steel/Rebar.
5. Brick/Blocks
6. Water.
7. Tiles.
8. Wood.
9. Aluminium Upvc.
10. Water proofing materials.
11. Plumbings materials.
12. Electical materials.
Cement:
Main Types of Cements.
1. Ordinary Portland cement (OPC).
2. Portland pozzolana cement (PPC).
3. Rapid Hardening cement.
4. Sulfate resisting cement.
5. Blast furnace slag cement.
6. High alumina cement.

Test for Cement (Laboratary Test):

1. Fineness test.
2. Soundness test.
3. Consistency test.
4. Strength test.
5. Setting test.
6. Bulk density.
7. Specific gravity.
8. Chemical composition test.

Test for Cement (Field Test):

1. Color.
2. Physical properties.
3. Presence of lumps.

Test for Sand

1. Silt content test.
2. Sieve Analysis test or Test for grading of sand.
3. Rubbing of test.
4. Visualization test.
5. Bulking of sand.

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Test for Coarse Aggregates:
1. Crushing test.
2. Abrasion test.
3. Impact test.
4. Soundness test.
5. Shape test.
6. Specific gravity & water absorption test.

Test for Steel:

1. Tensile Test.
2. Yield Stress test.
3. Percentage Elongation test
4. Bend & Re-Bend test.
5. Unit weight of steel.
6. Chemical Analysis test.

13. Grade of Steel

TMT bars-THERMO Mechanically Treated.
Different Grades:
1. Fe 415
2. Fe 500
3. Fe 550
4. Fe 600
Where number denotes minimum yield strength in N/mm2
Yiel strength-is defined as the stress at which the reinforced bar starts to exhibit plastic deformation.

14. Abrovision for Quantity Surveyor or Civil Engineer:

BOQ = Bill of Quantity.
MoQ = Minimum Order Quantity.
RFI = Request for Inspection.
IPA = Intrime Payment Application.
IPC = Intrime Payment Certificate.
VO = Variation Order
FIDIC = The International Federation of Consulting Engineers.
EOT = Extension of Time.
CVR = Cost Value Reconciliation.
BOT = Build Oparste & Transfer Contract.
LOI = Letter of Intent.
IVS = International Valuation Standards.
MOQ = Minimum Order Quantity.
RSC = Rigid Steel Conduit.
ASTM = American Society for Testing and Materials.
CBR = Carlifonia Bearing Ratio.

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15. Unit Weight: of Construction Materials- Cement, Steel, Concrete, RCC.
SL. NO. MATERIAL THEORETICAL UNIT WEIGHT (kg/m3)
1. Cement 1440 kg/m3
2. Steel 7850 kg/m3
3. Sand
(a) Dry 1600 kg/m3
(b) River 1760 to 2000 kg/m3

4. Stone (Basalt) 2850 to 2960 kg/m3

5. Cement Concrete (Plain) 2400 kg/m3
6. Cement Concrete

(Reinforced) (RCC) 2500 kg/m3

7. Water 1000 kg/m3
8. Bricks 1600 to 1920 kg/m3
9. Brick Masonry 1920 kg/m3
10. Soil (damp) 1760 kg/m3
11. Cement Concrete Block (Solid) 1800 kg/m3
12. Cement mortar 2080 kg/m3
13. Lime Mortar 1760 kg/m3
14. Lime 640 kg/m3
15. Glass 2530 kg/m3
16. Bitumen 1040 kg/m3
17. A.C. Sheet Corrugated 16 kg/m2
18. Granite Stone 2460 to 2800 kg/m3
19. Marble Stone 2620 kg/m3
20. Sal Wood 990 kg/m3
21. Teak Wood 670 to 830 kg/m3
22. Timber (Mango) 650 kg/m3
23. Plastics 1250 kg/m3
24. Ashes 650 kg/m3
25. Rubber 1300 kg/m3
26. Chalk 2100 kg/m3

Useful information
CONCRETE GRADE:

CLEAR COVER TO MAIN REINFORCEMENT:

WEIGHT OF ROD PER METER LENGTH:
DESIGN MIX:
Brick Size
STANDARD CONVERSION FACTORS

CONCRETE GRADE:
M5 = 1:4:8
M10= 1:3:6
M15= 1:2:4
M20= 1:1.5:3 M25= 1:1:2
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16. CLEAR COVER TO MAIN REINFORCEMENT:
1. FOOTINGS: 50 mm
2. RAFT FOUNDATION.TOP: 50 mm
3. RAFT FOUNDATION.BOTTOM/SIDES: 75 mm
4. STRAP BEAM: 50 mm
5. GRADE SLAB: 20 mm
6. COLUMN: 40 mm
7. SHEAR WALL: 25 mm
8. BEAMS: 25 mm
9. SLABS: 15 mm
10. FLAT SLAB: 20 mm
11. STAIRCASE: 15 mm
12. RET. WALL: 20/ 25 mm on earth
13. WATER RETAINING STRUCTURES: 20/30 mm

17. WEIGHT OF ROD PER METER LENGTH:

DIA WEIGHT PER METER
6mm = 0.222Kg
8mm = 0.395 Kg
10mm = 0.616 Kg
12mm = 0.888 Kg
16mm = 1.578 Kg
20mm = 2.466 Kg
25mm = 3.853 Kg
32mm = 6.313 Kg
40mm = 9.865 Kg
1bag cement-50kg
1feet-0.3048m
1m-3.28ft
1sq.m-10.76sq.f ¬t
1cu.m-35.28cu.f ¬t
1acre-43560sq.f ¬t
1cent-435.6sq.f ¬t
1hectare-2.47ac ¬re
1acre-100cent-4 ¬046.724sq.m
1ground-2400sq. ¬ft
1unit-100cu.ft- ¬2.83cu.m 1square-100sq.f ¬t
1 M LENGTH STEEL ROD I ITS VOLUME
V=(Pi/4)*Dia x DiaX L=(3.14/4)x D x D X 1 (for
1m length) Density of Steel=7850 kg/ cub meter
Weight = Volume x Density=(3.14/4)x D x D X
1x7850 (if D is in mm ) So = ((3.14/4)x D x D X
1x7850)/(1000x1000) = Dodd/162.27

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18. DESIGN MIX:
M10 ( 1 : 3.92 : 5.62):
Cement : 210 Kg/ M 3 20 mm Jelly : 708 Kg/ M 3 12.5 mm Jelly : 472 Kg/ M3 River sand : 823 Kg/ M 3 Total
water : 185 Kg/ M 3 Fresh concrete density: 2398 Kg/M3

M20 ( 1 : 2.48 : 3.55) :

Cement : 320 Kg/ M 3 20 mm Jelly : 683 Kg/ M 3 12.5 mm Jelly : 455 Kg/ M 3 River sand : 794Kg/ M 3 Total water :
176 Kg/ M 3 Admixture : 0.7% Fresh concrete density: 2430 Kg/ M 3

M25 ( 1 : 2.28 : 3.27):

Cement : 340 Kg/ M 3 20 mm Jelly : 667 Kg/ M 3, 12.5 mm Jelly : 445 Kg/ M 3, River sand : 775 Kg/ M 3, Total
water, : 185 Kg/ M 3, Admixture : 0.6%, Fresh concrete density: 2414 Kg/ M 3, Note: sand 775 + 2% moisture,
Water185 -20.5 =164 Liters, Admixture = 0.5% is 100ml

M30 ( 1 : 2 : 2.87):
Cement : 380 Kg/ M 3 20 mm Jelly : 654 Kg/ M 3 12.5 mm Jelly : 436 Kg/ M 3 River sand : 760 Kg/ M 3, Total water
: 187 Kg/ M 3 Admixture : 0.7% Fresh concrete density: 2420 Kg/ M 3, Note: Sand = 760 Kg with 2%
moisture(170.80+15.20).

M35 ( 1 : 1.79 : 2.57):

Cement : 410 Kg/ M 3, 20 mm Jelly : 632 Kg/ M 3, 12.5 mm Jelly : 421 Kg/ M 3, River sand :735 Kg/ M 3, Total water
: 200 Kg/ M 3, Admixture : 0.7%, Fresh concrete density: 2400 Kg/ M 3, Note: sand = 735 + 2%, Water = 200- 14.7
=185.30, Admixture = 0.7%

M40 ( 1 : 1.67 : 2.39):

Cement : 430 Kg/ M 3, 20 mm Jelly : 618 Kg/ M 3, 12.5 mm Jelly : 412 Kg/ M 3, River sand : 718 Kg/ M 3, Water
Cement ratio : 0.43, Admixture : 0.7%, Note: Sand = 718 + Bulk age 1%

M45 ( 1 : 1.58 : 2.26):

Cement : 450 Kg/ M 3, 20 mm Jelly : 626 Kg/ M 3, 12.5 mm Jelly : 417 Kg/ M 3, River sand : 727 Kg/ M 3 + Bulk age
1%, Water Cement ratio : 0.43,Admixture : 0.7%

M50 (1 : 1.44 : 2.23):

Cement : 450 Kg/ M 3, 20 mm Jelly : 590 Kg/ M 3, 12.5 mm Jelly : 483 Kg/ M 3, River sand : 689 Kg/ M 3 + Bulk age
12%, Water Cement ratio : 0.36 (188 Kg), Admixture : 1.20%3, Micro silica : 30 Kg, Super flow 6.7% of cement

Brick Size
1 cubic meter contains 500 bricks
The Standard size of the 1st class brick is =190mmx 90mm x90mm and motor joint should be 10mm thick
So brick with motor=200 x 100 x 100.
Volume of 1st class brick = 0.19 x 0.09 X 0.09 =0.001539cu.m
Volume of 1st class brick with motor =0.2 x 0.1 x0.1=0.002 cu.m
No. on bricks per 1cu.m= 1/volume of1st class
brick with motor =1/0.002= 500 no’s of bricks

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19. STANDARD CONVERSION FACTORS
INCH = 25.4 MILLIMETRE
FOOT = 0.3048 METRE
YARD = 0.9144 METRE
MILE = 1.6093 KILOMETER
ACRE = 0.4047 HECTARE
POUND = 0.4536 KILOGRAM
MILLIMETRE= 0.0394 INCH
METRE = 3.2808FOOT
METRE = 1.0936YARD

A rope having length 100cm.You can form any shape using this rope (Example: Triangle,
Rectangle, etc.). Which shape will covers?
maximum area
1 Newton = o.101971 kg
1 mm2 = 0.01 cm2
1 cm2 = 100 mm2
1 mm2 = 20 N
100 mm2 = 2000N
1 cm2 = 2000N
2000 N = 203.942 kg
So 20 N/ mm2 = 203.942 kg / cm2
RATIO IS 1:1.5:3

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21. Estimation (Basic)

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