adjustment sum & contract-slide presentation

8/12/2019 adjustment sum & contract-slide presentation

1/23

SBQ 3722 PROFESSIONAL

PRACTISE IIIADJUSTMENT OF CONTRACT SUM

& FINAL ACCOUNTBy

SHAZLYN BT. APIU

TIMOTHY THOMAS

RUBBY DEAN


2/23

QUESTIONS :

1) DESCRIBE THE WORK PROCESS FOR THE

SERVICE

2) UNDERTAKES THE PLANNING & ORGANIZING

OF ITS SOURCES TO ACCOMPLISH

3) IDENTIFY THE PROBLEMS AND NECESSARY

SUGGESTIONS TO IMPROVE

4) MONITORING MECHANISM


3/23

ADJUSTMENT OF CONTRACT

SUM& FINAL ACCOUNT


4/23

Adjustment of Contract SumThe Certificate adjustments of Contract Sum were introduced for

the purpose of adjusting the amount of the contract price. The

total contract price shall be adjusted to take into account any

additional or lack of the total contract price.

Adjustment of Final AccountFinal account is an accounts that are provided to show the

payments that have been made including defects, claimfor damages or extra expenses.

Final accounts must be provided as soon as possible after the

contractor to meet its obligations under the contract


5/23

Adjustment of the contract sum in the final account

falls under several relevant items which is listed in the

standard form of contract and conditions

Sums that are to be Deducted :-

a) prime cost sumsb) provisional sums

c) variations that are omissions

d) any other amount that are to be deducted fromthe contract sum/


6/23

An important part of the contractors

quantity surveyors work is the agreement of

the Final Account.

Both Clients Quantity Surveyor andContractors Quantity Surveyor to work

together to produce an agreed statement of

the amount money to be paid at the end of a

building contract by the employer to the

contractor


7/23

The person who is responsible to prepare the Adjustment of

Contract Sum and Final Account

a) Contract Manager

b) Senior Quantity Surveyor

Duties:

a) Re-measurements usually done by the junior Qs.b) Adjustment, VO, Form APK & PHK & negotiation with the

contractor by the Sr. QS.

c) Final Account by the Contract Manager


8/23

Adjustment of Contract Sum includes :

a) APKArahan Perubahan Kerja

b) PHK - Pelarasan Harga Kontrak

c) Provisional Sum

d) Prime Cost Sum


9/23

Adjustment of Contract Sum includes

a) APKArahan Perubahan Kerja

Continuity of board approval on V.O, APK are required.

Consist of instructions to be carried out by the Contractor

Any claim due to this VO will be highlighted in this form.

S.O and Contractor to signed (if agreed)b) PHK - Pelarasan Harga Kontrak

After finalized the APK, new contract sum will be adjusted

accordingly

All collective APK will be summarized

Endorsement and agreement from both parties are required


10/23


11/23

Adjustment of Contract Sum

d) Prime Cost Sum

is an allowance that calculated by the consultant for

the supply of work or materials to be provided by

a contractor or supplier that nominated by the client.

The works is awarded to the nominated sub-contractor / supplier. Omit the original PC Sum and

add the awarded NSCs/NSs contract sum and profit

and attendance which is allowed in Contract.

The final adjustment is made after completion of

works and final cost is ascertained. PC Sums that are

not used shall be deducted from the Contract Sum.


12/23

Adjustment of Contract Sum

e) KKSKelulusan kuantiti Sementara

is an allowance that calculated by the consultant for

the supply of work or materials to be provided by

a contractor or supplier that nominated by the client.

The works is awarded to the nominated sub-contractor / supplier. Omit the original PC Sum and

add the awarded NSCs/NSs contract sum and profit

and attendance which is allowed in Contract.

The final adjustment is made after completion of

works and final cost is ascertained. PC Sums that are

not used shall be deducted from the Contract Sum.
http://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdf


13/23

Example PHK Form

Pelarasan Harga Kontrak

PHK bagi item Credit for

Material for the Material

on Site.

Pelarasan harga dinilai

mengikut kiraan yang

telah ditetapkan.
http://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdf


14/23

Example APK Form

Arahan Perubahan Kerja-

kerja tambahan untuk

membekalkan Peralatan

Elektrik.
http://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdf


15/23

Example APK Form

Arahan Perubahan Kerja-

kerja tambahan untukmembekalkan Peralatan

Elektrik.

Permohonan untuk

mendapatkan kelulusan

Perubahan Kerja.

Di nyatakan huraian kerja,

anggaran perubahan kerja

& Penca-punca

perubahan kerja.
http://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdfhttp://g/Proffesional%20Pratice%20III-Sem%206/Asiment%20ref/JKR-PHK.pdf


16/23

Preparation of Adjustment Contract Sum

Total contract price adjustment certificate must be

prepared and remove when the total contract priceshould be adjusted. It covers variation order.

All items in the certificate must be properly filled

Date is the date the certificate is a certificate signed PP

Calculation detail of the adjustment must be

appended except for adjustments due to changes in

work.

The certificate must be signed by the PP and theoriginal shall be issued to the contractor.


17/23

The contractor have to provide the architect or QS with all

documents necessary for the final account preparation not later

than 6 months after practical completion. Within 3 months of for

the architect or QS to prepare the final account sum and send this

to the contractor

The area to be cover under preparations of Final Account:

Variations

Re-measurement of provisional quantity in the Contract Bills

NSC account

Nominated supplier account

Loss and expense caused by disturbance of the regular processof the works

Its about sense of finality to the negotiations leading up to the

agreement of the Final Account between the parties to the

contract.

Preparation of Final Account


18/23

If there a doubt about the accuracy of any the original billed

items, he can make a request to the QS for work concerned tobe measured on-site.

Sums to be deducted:

a) Provisional sums and the value of work for which

approximate quantities are included in contract bills.b) Variations that are omissions

c) Amounts allowable to the employer under the fluctuations

clauses

d) Any other amount that is required by the contract to be

deducted from the contract sum.



19/23

Sums to be added:

a) Total amounts of nominated subcontracts finally adjusted

b) Where the contractor has tendered for work that was to have

been performed by a nominated subcontractor and his tender

has been accepted, the amount of the tender suitably adjustedc) Any amounts due to nominated suppliers, including cash

discounts of 5 per cent

d) The contractor's profit on the above amounts



20/23

Variation Orders (VO) are often a cause of contract

conflicts and may lead to negotiation, mediation /arbitration. It includes changing in design, quantities,

quality, working conditions, and sequence of work.

The contractor fails to agree with the valuation of

work. The disagreement may cause delay in

certifying the amount of final account.

There a rate that the contractor had to follow in

certain specification but the contractor normally putthe item rate uncertain because of strategies.

Problem faced by the Firm


21/23

Necessary Suggestions To Improve

Verify the work progress within one(1) month period.

Held a meeting at least twice a week to solve small

problem that occur at site .

The architect has the authority to order minor changes

in the work not involving adjustment in the contract

sum. Such changes shall be done in writing and shall

bind with owner and contractor.


22/23

Monitoring Mechanism

Review actual site practices and processes to control

expenditure for materials, labor plant/machinery and

subcontractors.

External relationship and information; communicating with,

coordinating with, and influencing related management

units, stakeholders and clients.

Internal relationship, including the use of inter-unit

committees within the same management systems and

communicating with other individuals

Monitoring physical, financial, accounting and social effects;

and Periodic evaluation of performance at indicator events

and timely adjustment of plans.


23/23

THANK YOU

Documents

adjustment sum & contract-slide presentation