Complete Revised

7/25/2019 Complete Revised

1/18

Professional

Practice 2

Group Assignment (QSB 3614)

Semester 5, 6th June 2016

Chew Jun ing (03101!3)

"i#son $o "ei %ong (031!3&2)

A'ng Aru# Aim (03166!4)

$ee %i *ng (0314&35)

Ahme+ unir B Am# (0304-24)

.tin Ati/h utri Binti A (030&4-6)

Table of Contents

Professional Practice 2 [QSB3614]


2/18

Coursework No. 2 Preparation of inal !ccount

"ntro#uction 1

Question 1 2 $ 6

Question 2 % $ 11

Question 3 12 $ 1&

INTRODUCTION


3/18

This report is briefly explaining the adjustment of the essential elements in

preparation of the Final Aount! "o#e$er% this report is set up to reogni&e the

signifiane and impliations if some #or's are entirely left out in the (ills of

)uantities and also not pi'ed out as pro$isional sums or *!C sums!

The onditions of the situation mentioned inludes +or's li'e entrane porhin #hih are sho#n on the dra#ings but not suffiiently designed for measurement of

,uantities are entirely left out in the (ills of )uantities and also not pi'ed out as

pro$isional sum or *!C! sum!

This report #ill o$er the definition% method and adjustment fundamental

omponent in preparation of the Final Aount! Other than that% it also defines of the

pro$isional and *!C sums relating to the irumstane assumed and later disuss on

the signifiane and impliations from t#o points of $ie#% onsisting of the lient and

the Contrator! -astly is the onlusion!


4/18

QUESTION 1

.ou are re,uired to prepare a report to your diretor% explain to

your diretor% explaining briefly the essential elements in

preparation of the final aount!

The diretor #ould also li'e to 'no# the signifiane and

impliations of #or's li'e entrane porh /#hih are sho#n on

the dra#ings but not suffiiently designed for measurement of,uantities0 are entirely left out in (ills of )uantities and also not

pi'ed out as pro$isional sum or *!C! sum!

Internal Memo

To1 2r! Diretor


5/18

From1 *rojet )3 3dn! (hd!

Re1 Report on the essential elements to be adjusted in Final Aount!

Date1 4thof 5une% 6784

As mentioned abo$e% this report emphasi&e on the essential elements that #illaffet the sum of final aount! The aim of preparing the final aount is to establish

the final ontrat $alue #hih #ill determine the sum that the Contrator to reei$e!

Aording to Clause 97!87 of the *A2 Contrat 6774% final aount must be issued

not later than six /40 months after the *ratial Completion of +or's! In order to

proeed #ith that% Contrator should submit all the rele$ant douments and

information #hih is neessary for the final aount preparation made by onsultants!

Final Aount is prepared to establish the final onstrution ost of projet! A

omplete Final Aount should inluding the follo#ing elements1

/i0 :ariation +or's /Clause 88!40

/ii0 Re;measurement of *ro$isional )uantities /Clause 88!4 /f00

/iii0 Omission of *rime ost and *ro$isional sum /Clause 97!88 /00

/i$0 Adding;ba' of N3C!8?! For example% $ariation may our in irumstane

suh as the arhitet gi$es instrution to hange the floor design! If there is no

pro$ision for $ariation% the =mployer may need to get the agreement of Contrator

and the Contrator may negotiate for higher ost! This $ariation lause is to permit

hanges to be made and subse,uently adjust or amend the ontrat sum! (esides% the

$aluation rules an be applied #here the +or's are ompleted by the Contrator for

#hih the pro$isional ,uantities and pro$isional sum had been inluded in the

ontrat bills!

Next% re;measurement of pro$isional ,uantities is stated under Clause 88!4/f0!

The *ro$isional )uantities are estimated ,uantities only% for instane the ,uantities for

exa$ation #or's and piling #or's! It is unrealisti to 'no# the onrete ,uantities for

the +or's mentioned at the early stage and subse,uently% the amounts shall be re;

measured by )uantity 3ur$eyor in;harged based on the atual +or's that ompleted!

The ,uantities are subjeted to hanges ho#e$er the rates pried in the Contrat

Douments #ill remain onstant!

(asially% *rime Cost sums are the sum of the speialist +or's ompleted by

the 3ub;Contrator #hih usually omprehensi$e of profits and attendane #hereas

*ro$isional 3ums are the sum of #or' done that an be a'no#ledged but #ith nodetailed dra#ing pro$ided and thus% the sum annot be itemi&ed in bills of ,uantities


6/18

/()0! The ,uestion #orth to be raised up is that% #hy is there a need to allo#

pro$isional sum in the () sine adjustment is to be made at the final stage -et


7/18

additional expenses in aordane to the Clause 88!> /a0 pro$ided the Contrator shall

gi$e #ritten notie to the Arhitet of his intention to laim for suh additional

expenses and the Contrator shall send to the Arhitet and )3 omplete partiulars

of his laim Clause 88!> /b0!

-ast but not least% -oss and =xpense laims #hih stated under Clause 6?!? in*A2 Contrat 6774 /+ith )uantities0 inurred by the Contrator #hih omplying

#ith Clause 6?!8% the Arhitet and )uantity 3ur$eyor shall ma'e ertain and inlude

suh amount of loss and expenses into the Final Aount! The #ords shall asertain

stated in the lause basially means that the Arhitet or the )uantity 3ur$eyor must

aess the laim based on partiulars and alulations submitted by the Contrator but

not merely rely on a general assessment before inluding the amount into the final

aount! Any laim under ommon la# is outside the jurisdition of the Arhitet and

)uantity 3ur$eyor% and the Contrator has to resol$e this #ith the =mployer!

"o#e$er% there are 9 elements #hih shall be exluded from Final aount

based on Clauses 97!88/e0 to /g0!

-i,uidated damages imposed by the =mployer% Clause 97!88/e0!

3et;off by the =mployer% Clause 97!88/f0!

Interest payable by either =mployer or Contrator% Clause 97!88/g0!

These items exluded from Final Aount due to1

Arhitets are ertifiers and they ertify #or' done only and not the parties to

the Contrat! They need to be fair and independent and it is not their

obligations to deide the party #ho is in dispute! Disputes may effortlessly happen from either party #ith suh omponents

being inluded in the Final aount% ausing the final aount sarely to be

finished by the dayEs end! The primary goal is not to postpone the timely

onlusion of the Final Contrat and it basially implies #ithout a final

aount% the Arhitet and )3 annot be disharged!

Implications of Omission of Provisional Sums

"a$ing the ondition as belo#1

a0 The +or's omitted is the entrane porh

b0 3ho#n on dra#ing but not suffiiently designed for measurement of

,uantities

0 +or's entirely left out in (ills of )uantities

d0 Not allo#ed as *ro$isional or *rime Cost 3ums

e0 Using the *A2 Contrat 6774 /#ith ,uantities0% and

f0 :ariable assumptions made aordingly!

Conclusion


8/18

There are essential elements needed to adjust during the Final Aount!

"o#e$er% o#ing the presene of pro$isional sums due to the error made by the

)uantity 3ur$eyor #ould imply onse,uenes to both the lient and Contrator!

2oreo$er% the ,uantity sur$eying onsultant firm #ould also suffer loss in both

monetary and aountability! This report mainly fouses on impliations to the lient

and the Contrator in$ol$ing the projet!

QUESTIONS 2


9/18

In aordane #ith Clause 97!87 of the ontrat% the Contrator duly submitted his

Final Aounts #ithin 4 months after the issuane of the Certifiate of *ratial

Completion! .ou are then re,uired to asses this appliation and prepare the Final

Aount for the apartment projet based of the follo#ing $aluations and adjustments

made to the Contrat 3um1

Information pro$ided are as follo#s1

a0 The Arhitet had granted the Contrator


10/18

Original *!C! @

*ro$isional 3um

N3CG77 3UA(NJ 5A.A% 3=-ANJOR DARU- ="3AN=mployer TaylorEs Uni$ersity


11/18

1Contrator1 Antimeat (uilder Constrution 3dn! (hd!

FINA- ACCOUNT

R2 R2

8!7 Original Contrat 3um

9?%G77%777!77

6!7 -ess 1*!C! @ *ro$isional3um

G%H77%777!77

Total (uilderEs #or's

6H%>77%777!77

9!7 Add 1

:ariation #or's

/:!O! Nos 8 ; ?0

Total

Additions

8%K77%777!77

TotalOmissions

8%7?4%777!77

Nett Additions

HG?%777!77 HG?%777!77

?!7 Add ba' 1 N3CsE final aount

6K%GG?%777!77

?!8 -ift 3er$ies

8%677%777!77

?!6Air;Conditioning3er$ies

8%777%777!77

?!9

=letrial

3er$ies

6%877%777!77

?%977%777!77 ?%977%777!77

?!?

*rofit and

Attendane1

a! *rofit 6B ofR2 ?%9777%777!77

H4%777!77

b! Attendane lump sum

47%777!77

8?4%777!77 8?4%777!77

G!7 Contratual Claims1

G!8Insurane*remium

6G%777!77 6G%777!77


12/18

FINA- CONTARCT :A-U=

9?%76G%777!77

*rojet1 *RO*O3=D CON3TRUCTION OF 8 UNIT 88;3TOR. A*ART2=NT ON -T ???%

NO! 6 5A-AN TA.-ORE3% ?>G77 3UA(NJ 5A.A% 3=-ANJOR DARU- ="3AN=mployer1 TaylorEs Uni$ersityContrato

r1 Antimeat (uilder Constrution 3dn! (hd!

3TAT=2=NT OF FINA- ACCOUNT

Final Contrat :alueR2 9?%76G%777!77

Dedut1 Assumed *re$iously Certified /Cert

8;670

R

2 96%777%777!77

(A-ANC=D DU= TO CONTRACTOR

R

2 6%76G%777!77

D=C-ARATION OFAJR==2=NT

+e% the undersigned% hereby onfirmed our agreement to the attahed Final Aount and

3tatement of Aount as follo#s1

80 That the Final Aount and 3tatement of Aount is orret and is in aordane

#ith the Condition of Contrat!

60 That the Final Contrat :alue of R2 9?%76G%777!77 is orret!

90 That #e ha$e no further laims #hatsoe$er against eah other!

L!!L!!L!!L!!L!!L!!L!!L!! L!!L!!L!!L!!L!!L!!L!!L!!

=mployer Contrator

Date1 Date1

L!!L!!L!!L!!L!!L!!L!!L!! L!!L!!L!!L!!L!!L!!L!!L!!


13/18

+itness +itness

Date1 Date1

*rojet1 *RO*O3=D CON3TRUCTION OF 8 UNIT 88;3TOR. A*ART2=NT ON -T ???%

NO! 6 5A-AN TA.-ORE3% ?>G77 3UA(NJ 5A.A% 3=-ANJOR DARU- ="3AN

=mployer1 TaylorEs Uni$ersity

Contrator1 Antimeat (uilder Constrution 3dn! (hd!

3TAT=2=NT OF FINA- *A.2=NT

+e% Antimeat (uilder Constrution 3dn! (hd! "ereby a'no#ledge reeipt of a he,ue dra#n

on 3tandard Chartered (an' 2alaysia (erhad /Number G76G790 for sum of Ringgit 2alaysia

T#o 2illion and T#enty Fi$e Thousand /R26%76G%777!770 only from TaylorEs Uni$ersitybeing full and final settlement for the abo$e mentionedprojet!

+ith the aeptane of this payment% Antimeat (uilder Constrution 3dn! (hd! agrees that it

has no further laims or moneys due and payable from TaylorEs Uni$ersity!

L!!L!!L!!L!!L!!L!!L!!L!!

Contrator

Date1


14/18

QUESTION 3

=xplain the basis on ho# the follo#ing $ariations may be finalised and pried during

the Final Aount stage1

a! The Contrator had pried R2 8G7%777!77 for the Contrator All Ris' Insurane

poliy in the *reliminaries (ills! "o#e$er% #hen the Contrator failed to purhase this

insurane% the =mployer bought the said insurane for R2 8H7%777!77 on behalf of

the Contrator!

b! Contrator is re,uired to pro$ide a des'top personal omputer in the *reliminaries

setion but the item #as left unpried% i!e! () item #as left blan' in the rateMamount

olumn in the Contrat Douments! The Arhitet instruted the Contrator to pro$idea laptop omputer osting R2 87%777!77 in lieu of the des'top omputer!

! A #ash trough as re,uired and pried in the *reliminaries setion #as not

onstruted due to site onstraints imposed by the =mployer! "o#e$er% the $ehiles

lea$ing the site during onstrution #ere al#ays 'ept lean inluding the publi roads

using #ater jet #ashing!

d! 2ista'e #as made in rate for G7mm thi' onrete blinding is R2 87 per m9! Item

#as not rationalised during ontrat doumentation! "o#e$er% original ,uantity in ()

is 877m9 but re;measured ,uantity is 6%777 m9! The Contrator submitted a loss and

expense laim for R2 G7%777!77 and also laimed for re$ised rates!


15/18

9a! The Contrator had pried R2 8G7%777!77 for the Contrator All Ris' Insurane

poliy in the *reliminaries (ills! "o#e$er% #hen the Contrator failed to purhase this

insurane% the =mployer bought the said insurane for R2 8H7%777!77 on behalf of

the Contrator!

*A2 Contrat 6774 /+ith )uantities0% under Clause 8K!7% stated that

insurane against injury to person and loss andM or damage of property re,uired

Contrator to arrange for insurane to support the indemnity gi$en in Clause 8H!7/injury to person and loss andM or damage of property to =mployer0! The purpose of

insurane is to1;

a0 Clause 8K!8/a0 ; insurane o$er to =mployer% Contrator% and other parties!

b0 Clause 8K!8/b0 ; third parties for any personal injury or property loss!

0 To o$er losses and minimi&ing disputes bet#een =mployer and Contrators!

d0 *otential osts% fees% rights% and damages for the =mployer and the

Contrators!

Contrator had pried the said insurane poliy in the *reliminaries (ills as it

is stated in Clause 8K!9% Contrator and all 3ub;Contrators to ta'e insurane to o$er

any loal #or'men #hih not subjet registration under 3OC3O and is bound to get

registered before Commenement of +or'! The duration of o$er of the Contrator

All Ris' Insurane poliy shall be $alid up to the Completion Date and 9 months after

the Defets -iability *eriod /D-*0!

Contrator has failed to purhase the insurane% this gi$es default po#ers to

the =mployer as stated under Clause 8K!G% and =mployer an purhase the insurane

on behalf of the Contrator% and the premium paid shall be reo$ered through a set;off

under Clause 97!?! 3hould suh ris's #ere to happen% the Contrator is able to laim

from the insurane ompany and not ta'en out from o#n personal asset!

=mployer has inreased the said insurane from R2 8G7%777!77 to R2

8H7%777!77 on behalf of Contrator as stated under Clause 8K!G% If the Contrator

ma'es default in insuringL% the =mployer may /but is not obligated to0 insure against

any ris's in respet of #hih the default has ourred and the amount of premiums

and any other ost inurred% this gi$es =mployer the rights to hange the premiums

o$ered from R2 8G7%777!77 to R2 8H7%777!77! Therefore% the final prie for the

said insurane is R2 8H7%777!77!

!

9b! Contrator is re,uired to pro$ide a des'top personal omputer in the *reliminariessetion but the item #as left unpried% i!e! () item #as left blan' in the rateMamount


16/18

olumn in the Contrat Douments! The Arhitet instruted the Contrator to pro$ide

a laptop omputer osting R2 87%777!77 in lieu of the des'top omputer!

+hen the omputer e,uipment in the *reliminaries is left unpried% it shall be

deemed that the 2ain Contrator has inluded the rates and pries else#hereinorporated throughout the bills of ,uantities! This is neither the default nor breah

of the main Contrator sine there is no speifi rule or standard #ay to priing

preliminaries! "ene% the )uantity 3ur$eyor shall identify the ost of the omputer

e,uipment to allo# the =mployer to omit the ost of the omputer e,uipment as stated

in Arhitet!8?0 shall be made in aordane #ith the

follo#ing rules1

Clause 88!4/a0 stated that #here #or' is of a similar harater to% is exeuted

under similar onditions as% and does not signifiantly hange the ,uantity of #or' as

set out in the Contrat Douments the rates and pries in the Contrat Douments

shall determine the $aluation! Therefore% the )uantity 3ur$eyor shall omit the ost of

omputer e,uipment based on urrent fair mar'et prie or the ost from pre$ious

ontrat douments of a similar projet!

9! A #ash trough as re,uired and pried in the *reliminaries setion #as not

onstruted due to site onstraints imposed by the =mployer! "o#e$er% the $ehiles

lea$ing the site during onstrution #ere al#ays 'ept lean inluding the publi roads

using #ater jet #ashing!

The Clause 88!4 under *A2 Contrat 6774 states that the $aluation of

:ariations and #or' exeuted by the Contrator for #hih a *ro$isional )uantity is

inluded in the Contrat and the expenditure of *ro$isional 3ums /other than for #or'

for #hih a tender had been aepted under Clause 6>!8?0 shall be made in

aordane #ith the follo#ing rules1

Under *A2 6774 under lause 88!4/0 of :aluation rules% the lause states that

#here #or' is not of a similar harater to #or' as set out in the Contrat Douments%

the $aluation shall be pried at urrent fair mar'et rates and pries are to be

determined by the )uantity 3ur$eyor!

"ene% the )uantity 3ur$eyor shall omit the ost of #ash through in the

preliminaries and adds the prie for the #ater jet mahine! The prie of the #ater jet

mahine is determined based on urrent fair mar'et prie or the ost from pre$ious

ontrat douments of a similar projet!


17/18

9d! 2ista'e #as made in rate for G7mm thi' onrete blinding is R2 87 per m9!

Item #as not rationalised during ontrat doumentation! "o#e$er% original ,uantity

in () is 877m9 but re;measured ,uantity is 6%777 m9! The Contrator submitted a

loss and expense laim for R2 G7%777!77 and also laimed for re$ised rates!

In *am 6774 under Clause 88!4 of :aluation rules% the lause states that the

$aluation of $ariations and #or' exeuted by the Contrator for #hih a *ro$isional

)uantity is inluded in the Contrat and the expenditure of *ro$isional 3ums /other

than for #or' for #hih a tender had been aepted under Clause 6>!8?0!

*A2 Contrat 6774 /#ith )uantities0 Clause 88!4/b0 had stated that #here

#or' is of a similar harater to #or' as set out in the Contrat Douments but is not

exeuted under similar onditions or is exeuted under similar onditions but there is

a signifiant hange in the ,uantity of #or' arried out% the rates and pries in the

Contrat Douments shall be the basis for determining the $aluation #hih shall

inlude a fair adjustment in the rates to ta'e into aount suh differene% therefore%

the Contrator an laim for the re;measured ,uantity of element #ith a fairadjustment in rates that stated in the Contrat Douments!

In Clause 6?!8/a0% the Contrator must gi$e his e$idene along #ith the

alulation as to justify his sum of laim for R2 G7%777 to the Arhitet learly and

this must be done #ith 6H days from the date of the Arhitet


18/18

Complete Revised

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