Level 2 Questions - 100 Liverpool Street (Interim Valuations & cost report) Flashcards
How did your interim valuation contribute to cost control?
- Update cash flow and compare to forecast, allowing me to raise any issues early with the client
- Ensures the client doesn’t overpay for the works
What was the process of agreeing the interim valuation on 100LS?
1) On 100LS I oversaw the MEP items within each AFP
2) Receive contractors application on the IVD
3) Review items being applied for in month
5) Organise site visit with contractor / required subcontractors
6) Marked up drawings / took pictures to assess works
7) Returned to office to complete valuation
8) Set up a meeting with the contractor to discuss the assessment and reach an agreement
9) Preparation of paperwork on or before the due date
10) Issue to EA
How did your interim valuation assessment feed in to the cost report?
Once the works had been certified and the relevant documentation issued to the EA for confirmation, the amount certified to date could be updated in the cost report to reflect the current position
How did you ensure the progress of works on site was on track?
By assessing the works on site, I could then align monthly valuations with the cash flow to understand progress
Give me an example of an item you assessed and how did you do this?
1) Check application, see how much of the ventilation system they are applying for
2) For ductwork, I would assess all ductwork through the risers as well as horizontal runs
3) Went to the roof to review the AHUs and associated ductwork
4) Marked up ductwork drawings to represent installed works
5) Checked any materials off site
6) Return to the office and complete my assessment
What are the timescales for payment?
• SBC 2016: Interim Valuation Date stated in the Contract Particulars
o If no date is stated, the first Interim Valuation Date
is one month after the Date of Possession
• DB: interim payments are to be made in accordance with Section 4 and whichever alternative applies:
o Alternative A – staged payments
o Alternative B – periodic payments
1) Interim Valuation Date (7 days before DD)
2) Due Date
3) Payment cert issued by CA/EA (5 days from DD)
4) Final Date for Payment (14 days from DD)
5) Payless notice to be issued no later than 5 days before the final date for payment
What happens if the contractor does not issue a payment application?
SBC: CA will request that the QS still undertakes a valuation of the works and the process will continue as normal, just without the contractor’s input.
D&B: The process will slide back (same time frames) from the date the contractor issues their application
What happens if the CA/EA does not issue the Payment Certificate?
Where the contractor has made a payment application, he will subsequently issue a payment notice. If unreasonable then the client can issue a payless notice. If NO payless notice is issued then then amount due is the sum in the contractor’s application
Where the contractor has not made a payment application he may at any time after the last date for issue of the Payment Certificate give a Payment Notice to the QS stating the sum he feels due and the basis of which it has been calculated. The process / timeframes will slide back from that date.
What is a Contractor’s Payment Application?
- SBC Clause 4.10
- Details work and entitlement up to the Interim Valuation Date
• Must include:
o Gross valuation and net valuation
o Details showing how the sum has been calculated
o Deduction of retention
o Deduction of advanced payments
o Deduction of sum of previous certificate and any other payments
What is the Interim Valuation Date?
- SBC Clause 4.8 in 2016 / SBC Clause 4.9.1 in 2011 / DB Clause 4.7.1 – 4.7.2 in 2016
- Total value of the works executed and materials on site and any other amounts specified as being payable under the contract
- Made by the QS to provide advice to the certifier (CA/EA) for the issue of interim certificates and payment notices
- Conducted on a gross basis (Full value before deductions)
Process of assessing an interim valuation?
- Receive contractor’s interim application
- Ascertain works are in accordance with the contract (Written consent by EA/CA)
- Complete comp check of contractor’s application
- Make fair assessment of the works (inspect site with contractor’s QS and take photos)
o Works could include (Prelims, main contract works / measured works, materials on site, materials off site, agreed variations, agreed claims for L&E, fluctuation payments, retention, amount previously paid)
- Ascertain valuation (gross value, net value and balance due)
- Check valuation (comp check)
- QMS
- Assemble documentation (letters to employer & contractor)
- Issue recommendation to EA/CA
- Maintain records
How do you value Prelims?
Assess both fixed and time related prelims
Each item is valued individually on merit
Timesheets can be used for workman prelims
How do you value Measured works?
PQS attends site and physically measures each item of the valuation alongside drawings
PQS does NOT check works are in accordance with the contract, the EA/CA is to do this
How do you value Materials on site?
- Amount of materials delivered to site for the purpose of the works
- PQS physically measures each item
- Contractor should have prepared a list with delivery notes
• Exclusions include:
o Materials that are not protected
o Damaged materials
o Quantities in excess
How do you value Materials off site?
Items which have not yet been delivered to site but are required (e.g. Swichgear)
Items must be included in the contract as LISTED ITEMS
Must be in accordance with the contract (CA/EA to determine)
Proven that the contractor has the title to the goods (VESTING CERTIFICATE)
Items must be set aside, visible, identifiable, appropriately marked with the employer’s name and address
Items must be insured by the contractor AGAINST SPECIFIED PERILS (until delivery)
Bonds should be provided for listed items and uniquely listed items
Items should be READY FOR INCORPORATION
