StudentShare solutions
Triangle menu

Pre-Contract Cost Planning and Cost Controlling - Assignment Example

Extract of sample
Pre-Contract Cost Planning and Cost Controlling

Cost planning not only enables capital cost budgets to be set but also provides a structure to accommodate as well as manage transformations to the client’s brief and design (Murdoch & Hughes, 2007, p.80). An effective Cost plan enables a client together with the design team to understand where and how finances have been allocated towards the completion of a project. On the other hand, Cost control should be provided from start to completion of the project, ensuring that the estimated final cost is always known. However, Pre-contract Cost Controlling is quite different from the Post-contract Cost Controlling.
Pre-Contract Cost Planning and RIBA Plan of Work
As aforementioned, an effective construction plan is the foundation of the budget development as well as schedule for work. Pre-construct cost planning is thus crucial when preparing a construction plan. Even though construction costs can be pre-planned as well as estimated, it is quite possible for these to significantly change in the course of the actual construction (Chitkara, 1998, p.99). Pre-contract cost planning informs the owner when financial installments will be required to enable him/her keep current with the billings (Ferry, et al., 1999, p.55). When establishing a pre-contract cost plan it is important to create one that follows the RIBA Plan of Work. RIBA plan of work is one that tends to organize the process of managing as well as designing building projects while administering building contracts to a number of essential Work Stages (Potts, 2007, p.13). The Work Stages included in the RIBA Plan of Work are Preparation, Design, Pre-Construction, Construction and Use (Mincks & Johnston, 2004, p.109). Under the Preparation stage, identification of client’s needs and objectives is done. Feasibility studies as well as assessment of options enabling the client to make a decision is also prepared under this stage (Murdoch & Hughes, 2007, p.81). The contractor then develops an initial statement of requirements into the Design Brief as a way of confirming the main requirements and constraints. The Design Brief is then implemented, and additional information prepared. Under the Design stage, concept design is developed and includes updated outline specifications, cost plan and structural and building services systems (Ferry, et al., 1999, p.57). The Pre-Construction stage involves preparation of production information in full detail enabling tender(s) to be acquired. Further information for construction required under the building contract is also prepared after application for statutory approvals has been done (Chitkara, 1998, p.100). Identification as well as evaluation of potential contractors for the project is then carried out, and recommendations submitted to the client. During Construction stage, the ...Show more

Summary

Cost planning is considered important where successful planning, design and construction of projects are concerned (Mincks & Johnston, 2004, p.102). Its main objective is to provide the best value solutions to project managers. …
Author : yhammes
Pre-Contract Cost Planning and Cost Controlling essay example
Read Text Preview
Save Your Time for More Important Things
Let us write or edit the assignment on your topic
"Pre-Contract Cost Planning and Cost Controlling"
with a personal 20% discount.
Grab the best paper

Related Essays

Cost and Quality
Connectively, work break down structure displays the amount of time that each task will consume and cost associated with each task (Haugan, 2003). The structure further helps to identify critical path. Whereby, the most urgent tasks should be given the first priority.
5 pages (1250 words) Assignment
Managerial and Cost Accounting
According to the author of the article, the evolution of the field of Management Accounting as a separate branch of accounting dates back to the late 1930s. It was during this decade Ross G. Walker joined the faculty of the Harvard Business School. He came from a successful management position in a business corporation.
14 pages (3500 words) Assignment
Cost Accounting and Cost Accounting System
ther hand, cost accounting systems are the internal information systems structures and procedures that are applied by a company to ensure proper cost accounting. Cost system is one of the scopes of cost accounting, although both have a common objective of providing relevant
1 pages (250 words) Assignment
Cost-based Approach
Therefore, minimum transfer price which selling division should charge must be at least equal to the sum of production cost and the amount of contribution forgone by the selling division
1 pages (250 words) Assignment
Opportunity cost direct and indirect cost.&marginal cost, average cost and sunk cost
The transportation cost to attend the popular Justin Beeber concert was $15. The concert costs are direct cost. Evidently, the $50 indirect costs are greater than the preferred direct concert attendance cost, $35. Direct costs are attributed to a specific
2 pages (500 words) Assignment
Cost Management
On-line commerce has been increasing at an unprecedented rate and 275 of all on-line merchants sell their products and services to foreign markets. Additionally, only 32% of U.S. on-line merchants
1 pages (250 words) Assignment
Cost of capital, weighted avareage cost, cash flow, marginal cost
This relationship also makes the investor be aware of their risk tolerance which improves on the investment approach. The relationship further explains that the risk takers will always ignore the risk involved and
2 pages (500 words) Assignment
Cost Allocation
One of the major importances of this structure is that it allows the health providers to control provision of health care. In the case a provider is reimbursed primarily by fee-for-service, the best cost structure is variable cost structure.
1 pages (250 words) Assignment
Opportunity Cost
table above, developing country of Sud has absolute advantage in production of both corn and television since it cost less hours to produce a unit of both product in the country as compared to Industrial country of Norte. Industrial country of Norte however has a comparative
1 pages (250 words) Assignment
Contract Cost and Documentation for the Navy
The other competitors agreed that Lester Myers Inc. has specialization in coating the floors with advanced techniques. The company is equipped with advanced, revised and upgraded
7 pages (1750 words) Assignment
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email
YOUR PRIZE:
Apply my DISCOUNT
Comments (0)
Rate this paper:
Thank you! Your comment has been sent and will be posted after moderation