1. COST PLANNING AND ESTIMATION

2. Course outline Overview of Cost Planning Cost Planning Techniques
Approximate Estimating
Elemental Method
Cost Planning at Various Stages of Design
Resource Analysis
Cash Flow
Valuation
Final Accounts

3. Teaching Scheme DATE CHAPTER 1. Overview of Cost Planning
2. Cost Planning Techniques
3. Approximate Estimating
4. Elemental Method
5. Cost Planning at Various Stages of Design
6. Resource Analysis
7. Cash Flow
8. Valuation
9. Final Accounts
Exam

4. 7. Cash Flow
7.1 Introduction 7.2 Pre-Tender Forecasts 7.3 Cashflow Calculations for the Client 7.4 Pre-Tender Cashflow Forecasts for the Contractor

5. 7.1 Introduction
Essential to make a reasonably reliable forecast of the likely flow of expenditure. Why? To be able to anticipate cash flow requirement and to be able to arrange for finance to be available accordingly.

6. 7.3 Cashflow Calculations for the Client

7. 7.3 Cashflow Calculations for the Client
The total cost of Contract is being broken down into monthly amounts over the period allocated to each item, which then be tabulated or plotted on a graph.
A graph plotted from such data is usually referred to as an “S-curve” graph because of the shape of the graph.

8. 8. Valuation
8.1 Interim Valuations 8.2 Measuring Work Item by Item 8.3 Preliminaries 8.4 Variations 8.5 Provisional Items 8.6 Materials On and Off Site 8.7 Sub-Contractors 8.8 Conclusion

9. 8.1 Interim Valuations
To ensure that the Contractor is paid regularly and in full for work carried out on site.
All Standard Forms of Contract include provisions for periodic or “interim” payments to be made, which stipulate the requirements and timelines.
Issuance of Payment Certificates must adhere strictly to the Contract.
Could be regular monthly certificates or stage payments.
Stage payments refer to payments to be made when certain defined stages have been completed.

10. 8.1 Interim Valuations General procedure
The total value of Works completed and the value of unfixed materials and goods delivered on the site deducting the total of previous payments, leaving a balance due for payment.
Total value of Works completed and the value of unfixed materials and goods delivered on the site as of end of January 2016
$100,000.00
Deducting
Total of previous payments
($40,000.00)
Balance due for payment
$60,000.00

11. 8.2 Measuring Work Item by Item
Ref
Item
Total Quantity
Total Works Previously Paid
(A)
Total Works Completed this month
(B)
Total Works Completed
(C) = (A) + (B)
2/17
Timber Doors
5 nos.
4 nos.
(4/5 x 100%) = 80%
1 no.
(1/5 x 100%)
=20%
4 nos. + 1 no = 5 nos
80% + 20% = 100%

12. 8.3 Preliminaries S/N DESCRIPTION CONTRACT BREAKDOWN (S$) INITIAL COST
RECURRING COST - 18 MONTHS
FINAL COST
AMOUNT ALLOCATE
NO OF MTH % S$ 22
Setting out and existing levels
100.00
30%
30.00
70%
70.00 18 - 23
Survey of existing services 29
Hoardings
60%
10% 31
Protective barriers, screens, etc 5%
90% 32
Signboard 33
Site office 35
Scaffolding for all trades
100% 36
Water and chilled water for the works 37
Temporary lighting and power 38
Provision of bulk bins and dumping of debris and waste, etc 40
Inspection of sewers and checking of levels 43
Maintenance during construction 45
Site management team 57
Cleaning up and reinstatement of works on completion
50% 84
Pre & post construction conditions surveys
Total Value of Work Completed c/f to Summary :
200.00
130.00

13. 8.4 Variations
Public Sector Standard Conditions of Contract for Construction Works 2014, Seventh edition

14. 8.4 Variations
Public Sector Standard Conditions of Contract for Construction Works 2014, Seventh edition

15. 8.5 Provisional Items
Public Sector Standard Conditions of Contract for Construction Works 2014, Seventh edition

16. 8.6 Materials On and Off Site
the value of materials, Plant and goods delivered by the Contractor on the Site for incorporation in the Permanent Works but not incorporated in such Works
the value of unused materials or goods not delivered to the Site

17. 8.7 Sub-Contractors
The Security Of Payment (SOP) Act came into operation on 1st April The Act seeks to improve cash-flow in the construction industry by giving parties the right to seek progress payment for work done, and providing fast and low-cost adjudication to resolve payment disputes.
Section 9 of the Act:-