Financial Control & Reporting Flashcards
Financial Control & Reporting
1. What is EBITDA?
a. Earnings Before - Interest, Taxes, Depreciation, and Amortization
- What is a Prime Cost Sum?
a. This is for supply of materials usually and is a unit rate for that material where the spec are not known yet. They exclude all associated prelims, OH&P
b. They are used for long lead items
c. i.e. if the spec of carpet is unknown so a rate of £25/m2 is used
- What is loss and expense
Costs incurred
Relvant Matter for which client is responsible
Not claimable anywhere else such as variations. No retention is taken on loss and expense
- How would you calculate loss and expense?
a. Loss and expense is considered a relevant matter in JCT. In previous projects I requested the contractor provide evidence of the direct loss and expense as soon as practicable, and update this information monthly when cost is realised. The CA/QS shall within 28 days reply with ascertained amount showing the difference.
- Talk me through how you have delivered Value Management for a client?
a. Value management is the overall process on a project where value is consistently achieved and strived for by making and considering choices and options. I have contributed to this on the data centre procurement project where I advised the client to include recommended spares on a contract for some equipment, this ended up being required, saved the cost of a variation later down the line when costs may have been more.
How would you cashflow a project at different RIBA stages?
Early on an s-curve generator would be used due to lack of information. This will be developed and manually calculated on a package basis with more information.
You mentioned that you adjusted the provisional sums on the veterinary fit-out of Havant, can you explain how you did this?
I would agree the cost with contractor, and following this and instruction into the contract, the actual cost will be added to the valuations, while omitting the cost of the PSum.
You mentioned on another project that you noticed the contractor was behind the cashflow forecast, what could this potentially mean? How did you deal with it?
This can be a red flag that the contractor is struggling financially, and unable to pay for all the materials and subcontractors. It could mean they are behind on programme as well, and works not complete to where previously estimated. I would carry out valuations as usual with due diligence, and be critical of materials on site.
What errors were there in the cashflow in enabling works?
I noticed on reconciliation with the original cashflow that valuations were behind, and works that should have been completed as per the programme had not been completed, and upon discussion with the contractor he did note that some works were behind due to not having certain approvals. I advised the client of this, and the issue and responsibility was with the contractor, just in case they did try and claim any EOT’s or losses.
What’s an example of each type of PSum
Defined - Ironmongery specification and type, if not yet known
Undefined - If aware of something in the ground, but not how much like archaeological works.
PC Sum - Such as the quantity of bricks
