PREPARATION OF COST ESTIMATES AND NEGOTIATION

The estimate can be prepared after all the information has been collected and analyzed, and the cost engineer decides upon the format to present the change. It is important to have a prior agreement and discussion as previously indicated with the contractor. Generally, successful negotiations depend on agreement in scope of work and accurate quantity take-off and a detailed estimate supported by accurate cost data for all elements. General guidance for the calculation of direct costs is noted as follows. Technical Data used in the field explained in quantity surveyor courses in Rawalpindi.

Additional Work:

For additional work, items and format should be priced similar to a new contract as performed by the known contractor. New work should be priced at the rates anticipated to be in effect at the time the work will be performed. Some more details of quantity surveyor courses in Rawalpindi  are as under.

Changed Work:

For changed work, a separate quantity takeoff for each item directly affected will be required for both before and after the change. Each item should be priced at the rates, which would be in effect at the scheduled time of accomplishment. Typically, each item of changed original work is priced, and each comparable item of revised work is priced at the applicable rates. The net cost (or credit) would be obtained by subtracting the total of the original work from the total of the revised work. It is important that the cost engineer maintain a comparable scope of work for both estimates. When an item of work will be performed as originally specified, except for a revision in quantity, the net quantity may be estimated directly for that item.

Deleted Work:

For deleted work, the item and format should be priced similar to a new procurement as performed by the current contractor. Rates in effect at the time the work would have occurred should be used. In addition to the direct cost of the work, overhead, profit, and bond costs should be included for credit on the deleted work.

Impact Related Costs:

Impact related costs, if applicable, should be clearly described and included as a part of each cost estimate.

Detail of Estimate:

The cost estimate for a modification should be prepared in as much detail as required to clearly cost the change for negotiations. In many instances, even more detail is required to negotiate the lowest reasonable price. The estimate should, however, be modified to reflect a negotiated procurement in lieu of an advertised procurement. It should include a general summary sheet relating the major categories of cost of the modification, both for increases and for decreases. Revised construction drawings and specifications are included in the modification supporting documents. When the cost engineer prepares the estimate, the effort should be the same as the contractor acting prudently under the given conditions. The results will generally provide an accurate estimate, which can be used as a firm basis for negotiation. The Government estimate should not rely on past generalized rates and settlements unless actually appropriate to the specific modification under consideration. TSK Training for Skills and Knowledge is the best institute in Rawalpindi Islamabad for Pakistani Students who wants to join quantity surveyor courses in Rawalpindi.