Scope of Services
Within the construction industry Quantity Surveyors are recognised as the financial managers of the construction process and play a critical role in ensuring the financial success of building projects. They act in liaison with architects, consulting engineers and contractors to safeguard the client’s interest as independent experts who are expected to maintain the highest level of professionalism towards all parties involved.
Key reasons to engage a Quantity Surveyor include the following:
- To establish an initial construction budget at an early stage of the development project.
- To monitor costs during the design, development and construction stages and take action to keep costs under control.
- To ensure that fully detailed tender documentation are prepared to minimise risks to the Employer from variations and contractual claims.
- To ensure tenders are obtained under the optimum conditions of competition.
- The use of a Quantity Surveyor provides contractors the assurance that cost management will be carried out in an equitable manner allowing contractors to be more competitive.
The services provided by GES Solutions fall under the following headings all of which are encompassed under the umbrella of quantity surveying.
Cost Planning + Budgets
Effective cost planning is essential for providing financial certainty for the Client. GES works with our Clients and their design teams to understand the objectives and aspirations and to ensure that they obtain the most cost-effective solutions for their needs and budget.
We prepare an initial budget cost that is established by reference to current market pricing and our cost data from previous projects where applicable. Initially the Quantity Surveyor quantifies the detail in the design that is available but also interprets what will be included in the design at a later stage. Our experience with the design process and experience on over 200 projects allows us to better estimate the costs of the project well before the details are provided. Budget reviews normally occur at predetermined stages in the design process and are intended to ensure the design remains on budget and minimise any surprises when the design is completed and the project tendered.
An important element of our services is to work with the Client and the design team in looking for ways to simplify details, revise materials and other potential savings to reduce costs whilst being sympathetic to the design intent and the end product. This process is commonly called Value Engineering and involves representatives from the entire design team and with alternatives evaluated from functional, cost (capital and life cycle), planning, design, and sustainability perspectives.
The project cashflow can often be essential for the financial success of a project because it provides an analysis of not only the bottom line, but what needs to be paid when compared to the availability of funds or financing if applicable. The cashflow needs to consider not only the planned construction programme and the budget but also the specifics of the anticipated contractual agreements with reference to advance payments, deposits, material payment retentions etc.
Bills of Quantities
A major task for the Quantity Surveyor is the preparation of the Bills of Quantities, or BoQ. The BoQ provides the measured quantities of the items of work identified by the drawings and specifications in the tender documents for a project. The BoQ is prepared by reference to standard methods of measurement and provides a standard document for all tenderers to refer to when pricing the works therefore allowing tenders to be submitted in the same format which assists the tender analysis.
BoQ’s are primarily a tendering document allowing each contractor tendering for the project to price the work from the basis of the same information. The BoQ is also the basis for preparation of interim payment applications/certificates and as the first reference point for pricing of variations.
The BoQ includes a preliminaries and preambles section which defines the scope of the works, specific elements on the nature of the works, information on the contract conditions, special instructions to the contractor and measurement preambles to aid pricing. Separate sections are then provided for the measured works grouped by trade section or elementally and combined under headings i.e. structure, architectural, interior decoration, MEP and external works. A further section often used in BoQ’s is for Provisional Sums which are allowances estimated by the Quantity Surveyor for specific elements of the work that are not defined in sufficient detail to permit accurate pricing.
Procurement
- GES helps to guide their Clients through the various options that exist for construction project procurement to develop a strategy based on the client’s needs. This strategy can cover the following main headings:
- Alternative Procurement Types – Traditional, Design and Build, Construction Management etc.
- Method of tendering – competitive, two stage and negotiated.
- Form of Contract – Lump sum, remeasured, cost reimbursable etc.
- Work Packages – what separate packages (if any) will the works be broken down into for tendering and what contractual arrangements will be used (Nominated Sub-Contractors (NSC’s), Employer’s Direct Contractors) for the separate packages.
Tender Documentation
It is the function of the Quantity Surveyor to prepare the commercial and contractual tender documentation for issue to the tenderers for the separate work packages required on a project. These documents are project specific, incorporate specific requirements from the Client/Project Manager and can be reviewed in detail by the Client’s legal team. The documentation produced by GES may include some or all of the following depending on the needs of the project or work package:
- Form of Tender
- Instructions to Tenderers
- Form of Agreement
- General and Particular Conditions of Contract
- Appendix to Tender
- Forms for Bonding and Guarantees
- Employer’s Requirements
- Listing of drawings and specifications
- The Bills of Quantities
Tendering
When the procurement method and works packages have been agreed the Quantity Surveyor will prepare with the Client, Project Manager and members of the design team a list of potential contractors for the works. Pre-qualification is then carried out to determine potential contractors’ suitability for the specific work packages (previous experience, capacity to undertake the works, financial status etc.) and their interest in taking part in the tendering process; following which final tender lists are agreed.
GES usually compiles the full set of tender documentation, including drawings and specifications, and issues the tender packages to the tenderers. After the tender has been issued queries are often raised by the tenderers with respect to the tender documentation; GES then coordinates, prepares and issues the Tender Addendums to the tenderers as well as responding to any commercial, contractual or BoQ related queries.
Tender submission is normally closed and depending on the particulars of the project tenders maybe delivered sealed to the Clients, Project Managers or GES’s office with the tender opening being attended by more than one party and recorded by GES. Once the tenders have been opened GES will prepare a detailed tender analysis that involves evaluation of the bidders’ pricing together with any exclusions, qualifications, or clarifications and their cost implications. Pricing queries are issued by GES to the tenderers as part of the tender negotiation highlighting errors, omissions, pricing irregularities etc. to arrive at “apples for apples” comparable tenders that are compliant with the tender documentation. These reviews may be both by documentation queries and tender review meetings with the bidders’ and frequently require multiple rounds of submissions.
After the tenders have been compared and negotiations held, GES can then issue a tender report dealing with the commercial and contractual matters which when combined with the technical evaluation completed by the Project Manager covers the three main key elements of time, quality and cost. Working with the Client, Designers, and Project Managers we can prepare evaluation criteria to review both financial and non-financial aspects of the bid, including the relevant experience, proposed staff, references, schedule, quality systems and safety policies from which recommendations are issued to the Client for Contractor appointment.
Once the final Contractor selection has taken place GES will prepare a Letter of Award or similar if required and prepare the contract document for signing by the parties.
Contract Administration
During construction the Quantity Surveyor has a role in supporting the Client and Project Manager with administration of the Contract that may involve the following:
- Provide guidance on the requirements of the Contract regarding submissions, contractual responsibilities, prescribed timing, notices, remedies and general documentation requirements.
- Advise on contractual effects of planned design changes.
- Advise on contractual effects of proposed remedial actions.
- Arrange and chair contractual meetings as required.
- Assist with contractual correspondence.
Monthly Valuations
- The Quantity Surveyor reviews the interim payment application from the Contractors and prepares the interim payment certificate based upon the actual progress of works on site to include the following:
- Contractor’s preliminaries.
- Measured works – structural, architectural, interior decoration, MEP and external works.
- Variations agreed and yet to be agreed.
- Materials on site.
- Costs to be paid by the Contractor.
- Advance payment and recovery of advance payment.
- Retention deduction and release.
To prepare the interim payment certificate GES visit the site to assess the progress and work completed to date.
Cost Control & Change Management
Cost control is an ongoing process from project inception to completion and forms an integral part of the design and construction process which is traditionally led by the Quantity Surveyor. Once the budget is formally approved that is the benchmark against which the forecast costs are measured.
Our reporting issued on a monthly basis during construction provides information for the Client and Project Manager under the following headings:
- Executive Summary
- Procurement status.
- Budget Report that reports forecast final cost against the approved budget.
- Financial Status for each works package.
- Contract Status providing contractual information for each package.
The budget element of the report tracks the forecast final cost for the project against the approved budget and considers awarded works packages, agreed variations, variations to be agreed, forecast changes and contractual claims for prolongation etc.
A crucial element of the Construction phase services provided by GES is Change Management in dealing with the financial elements of design changes and other variations that traditionally happen on construction projects. These changes may be the result of requested general changes from the Client, additions & omissions to the scope of works, design coordination problems, expanded design detailing etc.
The Quantity Surveyor may provide indicative costings to the Client for proposed design changes with pricing options when required. They also carry out a detailed review of submissions from the Contractor for the cost of claimed design changes with reference to the contractual requirements for evaluation of variations. The summation of all the changes being captured in financial reporting keeping the stakeholders informed of the anticipated total construction cost for the project.
Final Account
The Final Account in construction contracts is the agreed statement of the amount of money to be paid at the end of a building contract by the Client to the Contractor(s) which brings about financial closure between the parties to the contract. The Final Account is prepared by the Quantity Surveyor often in conjunction with the contractor’s staff with the starting point being the contract sum which is then followed by adjustments in accordance with the terms of the contract. Examples of adjustments to the contract sum are as follows:
- Sums to be deducted – Prime cost sums in respect of nominated subcontractors; Provisional sums and the value of work for which approximate quantities are included in contract bills; Variations that are omissions; Monies owing to the Client from the Contractor; Any other amount that is required by the contract to be deducted from the contract sum.
- Sums to be added – The total amounts of nominated subcontracts finally adjusted in accordance with the relevant subcontract conditions; The value of work carried out against provisional sums or approximate quantities included in the contract bills; Variations that are additions; Any amounts payable by the Client to the Contractor by way of reimbursement for direct loss/and or expense; Any other amount that is required by the contract to be added to the contract sum.
Once completed and agreed by all parties it is common practice that the Final Account Statement is signed by all parties including the Client, Contractor, Project Manager and GES. The timing for finalisation of the Final Account is normally stipulated in most standard building contracts.
Specialist Services
In addition to standard Quantity Surveying services provided for our construction project Clients GES can also provide the following specialist services:
- Claims review and advice.
- Insurance valuations
- Feasibility studies
- Contract management services.
- Commercial management services.