Final Account of Quantity Surveyors
Calculating and agreeing the final construction price, the final bill, is usually of paramount importance to both the general contractor and the employer. The parties to the contract must therefore ensure that the final report includes a fair and accurate assessment of the works carried out.
Under lump sum contract arrangements, the original price agreed upon by the customer at the outset usually requires adjustment on several issues, including:
- Variations, ie. changes;
- Temporal measurements;
- Provisional sums;
- Fluctuations in labor rates and material prices;
- Claims for losses and expenses caused by disruption of the regular course of works;
Final account documentation should normally include, where applicable, all of the following:
- A clear summary showing the contract amount, followed by the gap values and additions from and to that amount related to the various elements of the bills.
- Copies of all instructions issued
- Detailed bill of variations setting out any adjustments required with measurements where appropriate and reference to supporting documents
- Documents related to PC adjustments or provisional amounts and provisional quantities
- Daily papers
- Documents used in the calculation of loss and reimbursement
- Any relevant correspondence, quotations etc
- Copies of all extension certificates and written applications of the contractor
- Copy of certificate or practical completion
- A copy of the original tender form
Under the terms of most construction contracts, the client’s quantity surveyor is responsible for preparing the final project bill, but in reality the most appropriate approach is for the contractor’s quantity surveyor and the client to work together to prepare an agreed final bill. The General Contractor’s Quantity Surveyor should be vigilant in identifying variations and work to be recovered at daily rates.
The preparation and reconciliation of the final bill can be a time-consuming process on some construction contracts and the contractor’s Quantity Surveyor should try, as far as possible, to alleviate any possible delays in reconciling the final bill.
Corrections for variations
The variance account must show separate adjustment values for each instruction. All adjustments to the bill of changes must be supported by an appropriate written instruction issued in accordance with the terms of the contract. There are no exceptions to this rule. Care shall be taken to ensure that, where appropriate, variations are valued at the same or similar rates to those included in the contract documents and that where the work is unrelated to the work contained in the original documents, apply fair and reasonable rates.
Adjustment of provisional totals, items and quantities
All provisional amounts, items and quantities must be omitted when adjusting the final bill. In most cases, of course, there will be costs that need to be added to the bill to cover the work done against the amounts, items or quantities and these costs must be supported by measurements, schedules, quotations, invoices or other documents , as the case may be.
Work performed on a daily basis
Amounts included in the final daily work bill must be supported by formal written instructions ordering the work and authorizing payment on that basis. Daily worksheets must be provided that have been carefully checked to support all amounts included in the final bill.
Claims for losses and expenses
Where the contract provides for the recovery of losses and costs incurred by the contractor, this will need to be carefully assessed and in most cases will require the services of a professional quantity surveyor to either advise on liability or make an assessment and ensure that the claim is properly documented.
Reconciliation of the final bill with the Contractor
In accordance with good practice, confirmation of the contractor’s agreement with the final invoice value should be obtained in writing and a copy of the necessary audit documentation.
Where the Clearance Certificate has been issued and there are no other outstanding matters requiring refund, the final assessment/Certificate must be issued together with a copy of the Clearance Certificate.
Final preparation and submission of bill
Contracts usually specify a fixed period after the practical completion of the work within which the final report must be prepared and submitted. The contractor is normally required to provide the customer’s quantity surveyor with all documentation as stated above for the purpose of adjusting the contract amount. When the quantity surveyor receives these documents and information from the contractor, the client’s quantity surveyor should prepare the final bill and then submit it to the contractor for approval through the architect.
#Final #Account #Quantity #Surveyors