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Cost Management - IIQS Presentation 28 October 2015

This document summarizes a cost management event for the Indian Institute of Quantity Surveyors on October 28, 2015. Sam Raman from Mace International Limited in Dubai will speak about cost planning, change management, and cost reports. The event will cover the key elements of cost management including cost planning, package management, change management, and cost reporting. It will discuss the objectives and processes for each of these areas.

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79 views35 pages

Cost Management - IIQS Presentation 28 October 2015

This document summarizes a cost management event for the Indian Institute of Quantity Surveyors on October 28, 2015. Sam Raman from Mace International Limited in Dubai will speak about cost planning, change management, and cost reports. The event will cover the key elements of cost management including cost planning, package management, change management, and cost reporting. It will discuss the objectives and processes for each of these areas.

Uploaded by

sharfutaj
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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CPD EVENT FOR

INDIAN INSTITUTE OF
QUANTITY SURVEYORS
28 OCTOBER 2015

Cost Management

Topic
COST PLANNING, CHANGE
MANAGEMENT & COST
REPORTS

Cost Management

Speaker
Sam Raman
AMIE (India), B.Sc. (Hons.) (UK), MIS (India), FRICS (UK)
Associate Director, Mace International Limited, Dubai, U.A.E

Cost Management

Course Administration
Mobile phones on silent
Ensure registration
Copy of presentation & hand outs available

Cost Management

About Mace

Cost Management

Cost Management

Cost Management

The Project Cycle


Inception
Feasibility
Concept

Definition
Scheme Design
Detail Design

Delivery
Procurement
Construction

Aftercare
Close Out

Cost Management

Key Elements of Cost Management

Cost

Quality

Time
Cost Management

Key Elements of Cost Management


Cost Planning
Package Management
Change Management
Cost Reporting

Cost Management

Key Elements of Cost Management


Cost Planning
Provides systematic way of determining cost and
confirming budgets

Cost Management

Cost Planning
Basic Elements Required
Project Description
Project Location
Intended Building Use
Client Brief
Historical Data
Area Information

Cost Management

Cost Planning
Audit Trail
Drawings and specifications used
Any assumptions made
Inclusions / exclusions
Run date
Source of data used

Cost Management

Cost Planning Process


No
Decision
to invest

Concept
Yes

CONTRACT

Budget Confirmed
& approved
by Client

Design

Value Engineering

Feasibility

Design
Budget confirmed
to architect

Scheme
Design

Change Control Process

Cost Cutting

Detail
Design

Tender

DESIGN

Cost Management

Construction

Cost Plan Development


Budget Deviation

Budget

Time / Version

Cost Management

Cost Planning
Contents
Front Cover
Contents

Instructions, assumptions
Inclusions / exclusions

Executive Summary
Project Details
Area Schedules

Cost Management

Drawings and documents

Cost Planning
Your Role
To understand the cost plan
To verify that the correct documents were used for the
cost plan
To review the cost plan
To agree the cost plan

Cost Management

Reference to Project Cycle


Inception
Feasibility
Concept
Definition
Scheme Design
Detail Design

Delivery
Procurement
Construction
Aftercare
Close Out

Cost Planning

Cost Management

Key Elements of Cost Management


Package Management is an essential management tool
for
Information Management
Procurement management
Cost Management & Reporting

Cost Management

Key Elements of Cost Management


Package Management
Package Coding and Management is an important
Project Management Tool which is used in Projects.
Package Management is evolved from the Initial
Procurement Strategy

Cost Management

Key Elements of Cost Management


Package Management
Package Management is identified in 6 distinct sections
Client
Consultant
Project Administration
Works
Authorities
Contingencies

Cost Management

Key Elements of Cost Management


Change Management
Provides knowledge of the implications
Provides the Employer with the ability to accept and
approve changes
Maintains an auditable trail of changes to the budget

Cost Management

Change Management
Objectives of change management
Provide advance warning of potential costs
Provide estimates / cost advice for the change
Procedure to enable key objectives to be achieved (Time
Quality & Cost)

Cost Management

Cost Management

Change Management
Approval Request Form (ARF)
Clearly Identify the Change
Date required for return in order to maintain programme
The REASON for the requested change
Responsibility for the change
Programme impact (if known)
Cost impact of the Change
Budget effect of the Change

Cost Management

Change Management
Types of Funding
New Budget (Increased Scope)
Transfers (Between Packages)
Contingency Fund (Unplaced Scope)

Cost Management

Change Management
Your role
Site instructions should have neutral cost implication
No verbal instructions
No instructions under letter
To understand reasons for changes
Unauthorised changes are not valid

Cost Management

Reference to Project Cycle


Inception
Feasibility
Concept

Definition
Scheme Design
Detail Design

Delivery
Procurement
Construction

Aftercare
Close Out

Cost Planning

Change Management

Cost Management

Key Elements of Cost Management


Cost Reporting
The Preparation of Standard Cost Reports informing the
Client of his liabilities and actions

Cost Management

Cost Reporting
Objectives of a cost report
Commercial feedback for the Employer
Provide realistic outturn costs at a fixed time
Identifies adjustments generated by various project procedures in
place on a project.
Recognises cost of unresolved issues
Highlights Employers actions
Cash flow advice
Future Procurement issues

Cost Management

Cost Reporting
Contents of a cost report
Executive Summary
Combined financial report
Introduction
Key issues / events
Employer actions
Provisional sums / Prime Cost rates
Claims
Bonds & Insurances
Cost Management

Cost Reporting
Contents of a cost report - Financial
Cash Flow
Detailed Cost Report
Early Warnings

Cost Management

Cost Reporting
Your role
Understand the Cost Report, use for summary in your
own reports
Accept the contents of the Cost Report
Monitor the Cost Report periodically

Cost Management

Reference to Project Cycle


Inception
Feasibility
Concept

Definition
Scheme Design
Detail Design

Delivery
Procurement
Construction

Cost Planning

Aftercare
Close Out

Change Management

Cost Reporting

Cost Management

Any
Questions?
Cost Management

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