Construction Cost Control & Management Coursework

Construction Cost Control & Management - Coursework Example Activity Duration in days Earliest start time Latest start time Total float AB 5 0 0 0 BC 5 5 6 1 CD 7 11 11 0 CE 5 11 11 0 DF 4 18 18 0 FG 5 22 22 0 FH 5 22 22 0 FI 4 20 22 2 FJ 7 22 22 0 JK 11 29 29 0 KL 6 40 40 0 KM 8 40 40 0 MN 5 48 48 0 LO 7 46 46 0 OP 6 53 53 0 PQ 3 59 59 0 2 (a) How the Contract Sum can be adjusted in accordance with the JCT form of contract JCT means Joint Contracts Tribunal, the bylaw applied to contractors and architects in fulfillment of contract conditions. According to Article 2 of the JCT contract forms, the contractor is given an option of adjusting the contract sum as per the agreement in the contract form. The sum of money in the form is exclusive of VAT, meaning that, the payment of VAT can be added to the sum if necessary. The extent to which it affects the contractor depends on his or her ability to reclaim the VAT money. According to Clause 5.2, the contractor can reclaim the contract sum in regard to work and labor involved in the contract (Neil , Baylis, 1999). The fact that the economy does not remain constant might bring a lot of complications in the contract. Changes in the value of currency and inflation are unpredictable and, therefore; one side of the parties involved might end up losing while the other one gains substantially. It is due to this reasons that certain formulas are provided to calculate the fluctuations. Although the contracts are based on fixed prices, adjustments are done in regard to changes in levies, taxes and duties imposed to the contract materials, tools, equipments and machineries. However, careful drafting and contract sum analysis must be done to facilitate effective amendment and adjustments when the... In conclusion of the research, the PERT chart has been critically used to schedule, organize, and coordinate the tasks in this project. It has effectively ascertained the expected time of the project for effective planning and accountability of time and estimation of resources and cost. From the analysis, the pessimistic, normal and optimistic time were estimated. This was critical in showing the various activities keeping in mind their dependence to each other and particular independence. From the analysis with help of the PERT diagram, the critical path procedure shows that the estimated longest time to complete the project will be 63 days. The NPV of projects X and Y were found to be 20.60 and 1041.90 respectively. The excavator used during the project should not be more than 5 years old, this for efficiency purposes and minimization of loss. With respect financial analysis, the tender documents of the contracting organization ought not to be complicated. The standard nature of th e documents will ascertain the value of the credit and cash flow of the contract period. The currency of operation is also critical in the sense conversion rate; therefore if contractor and employer are working on different currencies, risk measures should be taken into account prior to tendering and signing of contract. Consequently, issues prompting increment of project value have been discussed and shown clearly how the contractor can claim for additional cash. This is imperative for loss minimization in the process of project implementation.