Having confidence in the understanding of a project or business is of the upmost importance. Often the most severe issues are those that were not realised at an early enough stage to be mitigated or avoided entirely.
The assessor must understand:
1. Current and future income. Correct ongoing contract administration often assists in this process.
2. Current and expected final costs. To ensure accurate cost controls ongoing subcontract payment schedule systems should be adopted to manage outgoing variations.A further valuable step is to re-evaluate and reconcile all scope to avoid unforeseen variations.
3. The current progress of the works and an anticipated completion date. This is important when calculating remaining preliminary and general costs such as management and plant expenditure
Managing the budget is an important part of commercial management of a construction project.
Essentially, the process consists of:
1. Ensuring the costs calculated for resources before the project started are maintained throughout the project, and
2. Minimizing cost (and waste) to maximize profits,
A useful product which results from this process is a close understanding of which resources exceeded the estimated costs, which may then be corrected when pricing subsequent projects.
It may be the case that excessive costs are also recoverable via variation, subject to terms of the customers contract, however the customer must understand the excessive costs in the first instance to be able to make a claim
Understanding how your project is tracking is essential to being able to mitigate foreseen issues.
For example, if your labour or materials costs appear to be excessive, then you may need to change your operating processes to mitigate losses due to inefficient labour or material wastage.
Similarly, if your project preliminary and general (management, and site offices, mobile phone costs etc) are excessive, then this may indicate one of 2 things:
1. The project may have run over time, or
2. The project may have been under priced in the first instance.Understanding the health of your project is essential to managing the associated risks. You cannot fix what you don’t know about.
1. a copy of your current costs and,
2. an understanding of the contracted scope of works
3. an understanding of the current status of the project
– This is usually achieved by providing:
1. a copy of your accounting software records (if available), or your invoices,
2. a copy of your tender file (if you have already have a successful award of the contract),
3. a completed from which we will provide you which identifies:
a. Current earned revenue,
b. Current project time information,
c. Current outstanding procurement orders,
We accept xero data, Microsoft Excel records, paper & electronic invoices. We are able to work with several construction software platforms. Please feel free to contact us to chat about your needs” end of content addition