Quantification and Costing of

Construction Works

Organized By OQSC
2016 Summer Session

Conducted By
Wasantha Senevirathne
BSc. (Hons) QS, MRICS, MAIQS
Chartered Quantity Surveyor
RICS APC Licensed Assessor and Counsellor in UAE

Quantification and Costing of Construction Works

Programme of the Day
#

Description

Time

Competency outline at a glance

Scope to know

Break

10:00 10:45 am

How to provide a structured answer?

10:45 10:50 am

Principle dealing with options in a case

study

10:50 11:00 am

Shearing experience from recent RICS

APC interviews

11:00 11:10 am

Questions

11:10 11:30 am

8:00 10:00 am

Quantification and Costing of Construction Works

(RICS APC Pathway Guide, Quantity Surveying and Construction, issued February 2015)

At a Glance :
This is a core competency at level 3. It covers the quantification (measurement) of
construction works in order to value and control costs.
Level 1 Knowing
Level 2 Doing
Level 3 Advising

Knowledge and understanding

Application of knowledge and understanding
Reasoned advise with depth of technical knowledge

This covers the measurement of works for the purpose of:

preparing estimates and cost plans,
producing Bills of Quantities (BoQ), Schedules of Works (SoW), Schedule of Rates
(SoR), and
valuing works for interim payments, variations and final accounts.
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Quantification and Costing of Construction Works

At a Glance (contd):
It includes understanding:

the purpose of measurement,

the need for a standard approach to measuring,
measurement rules,
different ways in which floor areas can be measured and reported,
build-up of unit rates and prices from first principle, i.e. labour, plant, materials, etc.,
build-up of costs in respect of preliminaries,
quantification of overheads and profit,
quantification of risk and calculation of a risk allowance, and
forecasting tender and construction inflation.

Accordingly, the RICS APC candidates should have an awareness of the various methods of
quantifying and costing of construction works used throughout a project. They must have a thorough
understanding of the specific method used on their project (e.g. MoM, CoC, etc).
(Cost Estimating / Cost Planning / Preparation of Pricing Docs & Pricing / Evaluation / Valuation /
Final AC & Maintenance)
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Quantification and Costing of Construction Works

Study check list (as per RICS APC Pathway Guide):
Competency is broken down into a list of topics to help candidates (it is not
must a candidate to cover every topic).
a) Method of measurement:
New Rules of Measurement (NRM) / CESMM
RICS Code of Measuring Practice
b) Preparation of pricing documents:
Tender documents generally
Bills of quantities
Schedule of works
Schedule of rates
Provisional sums / prime cost sums

Quantification
of Construction
Works is
discussed on
today

c) Analysis of price:
Tender returns
Guaranteed / agreed maximum
price
Target cost pain / gain
mechanisms
Loss and expense
Preliminaries
Dayworks
d) Valuation of works:
Interim valuations
Valuing change
Loss and expense
Final account
Reporting on cost
Tender report
Correcting errors in tenders
Post contract financial reporting
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Quantification and Costing of Construction Works

Scope to Know:
Quantification of Construction Works:
1) Why do we need a Standard Method of Measurement (SMoM)?
provide a uniform basis for measuring construction works,
easier and faster in measuring and pricing of construction works as the
professionals are familiar with,
well tested by many professionals/industry and therefore, less ambiguities,
already available and ready to use,
provide a comprehensive information for measurement of each work,
provide the required guidance to prepare a comprehensive BoQ, SoW,
SoR,
facilitate to administrate the interim valuations (remeasurement contract)
and variations (measurements),
help towards sustainability (less paper work as reference of the SMoM is
only sufficient to include under the tender / contract), and
a suite of document like NRM1, NRM2 and NRM3 provides guidance for
quantification and costing of works throughout a project.
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Quantification and Costing of Construction Works

2) Primary Objectives of Bills of Quantities (BoQ) are:
to provide a coordinated list of items, together with their
identifying descriptions and quantities that encompass the
building works so that the tenderers are able to price/prepare
tenders efficiently and accurately, and
when a contract has been entered into:
provide a basis for the valuation of work executed for the
purpose of making interim payments to the contractor, and
provide a basis for the valuation of variations.

Quantification and Costing of Construction Works

3) Benefits of a BoQ are:
Detailed measurement for the purpose of BoQ production is beneficial for number of
reasons:
it allows to prepare pre-tender estimates (prepared immediately before calling the
tender and it is the final cost checks also known as engineers estimation),
it saves the cost and time of several tenderers measuring the same design in order to
calculate their bids for competition,
it provides a consistent basis for obtaining competitive bids,
it provides an extensive and clear statement of the work to be executed (however
scope of work is basically defined on drawings and specification),
it provides a very strong basis for budgetary control and accurate cost reporting of the
contract (i.e. post-contract cost control), including:
the preparation of cash flow estimates/forecasts,
a basis for the preparation of progress payments (i.e. interim payments), and
a basis for valuing variations.
it allows, when BoQ items are codified, reconciliation and any necessary transfers and
adjustments to be made to the cost plan,
when priced, it provides data to support/release payment from authority like RERA,
when priced, it provides data to support claims for grants; and
it provides one of the best sources of real-time cost data, which can be used to
provide expert cost advise on the likely cost of future building projects (it is a complete
cost model in a single document).
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Quantification and Costing of Construction Works

4) Types of BoQ can mainly be:
firm BoQ (to obtain a lump-sum price for a fully designed building project), or
approximate BoQ (subject to remeasurement from as built drawings).
5) Structure of a BoQ:
pricing preambles,
preliminaries,
measured works (with opportunity to corrects quantity errors, missing items, etc.)
provisional sums,
risks,
dayworks,
bill of adjustments (e.g. saving due to provision of various AP 10%, 15% & 20%,
retention bond during DLP/DNP, early payment and performance security
limited to TOC), and
main summary.

Quantification and Costing of Construction Works

6) Purpose of the Pricing Preambles:
Pricing preambles states which SMoM has been used in preparation of
BoQ, it to be used for the measurement of any part of the works and
the estimator's responsibility to price accordingly;
pricing preambles indicates the inclusiveness and coverage of the
unit rates/prices of the works (including builders works and
attendance related to the nominated subcontractors works),
provides the required guidance to assist in pricing,
provides deviations/amendments from SMoM,
provides method of payment for the preliminaries [e.g. contractors
equipment; 50% initial cost on mobilization, 40% running cost
(progressively) and 10% at demobilization], and
provides what includes in the PC Rates items in the BoQ and PC
Rates adjustment (alternatively PC Rates adjustment can be
described in particular CoC), etc.
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Quantification and Costing of Construction Works

7) Schedule of Works (SoW):

as an alternative to the BoQ,

in the case of without quantities contracts, a SoW is given to
the tenderers and it lists out the work comprised in the
contract under appropriate headings. Then, the tenderers are
required to price the SoW).
often involve with smaller projects or for alteration work,
SoW are prepared by designers rather than by the cost
consultants, and
SoW can be arranged on an elemental basis (substructure,
superstructure, internal finishes, fittings & furnishing, services,
prefabricated buildings & building units, work to existing
building and external works).
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Quantification and Costing of Construction Works

8) Schedule of Rates (SoR):

SoR in its lesser form in a standard contract can be a list of

staff, types of labour and plant hire rates upon which a
contractor has listed hourly rates for the purposes of pricing
work carried out under cost reimbursable contract, and
SoR in its larger scale (known as SoR term contract) is
normally used when the nature of work is known but cannot
be quantified, or if continuity of programme cannot be
determined, and
general preliminaries such as scaffolding, temporary power,
supervision and temporary accommodation will also have its
own rates.
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Quantification and Costing of Construction Works

9) Analysis, Collection and Storage of Cost Data:

The cost data provided in a BoQ can be analyzed and

reprocessed in various ways for use in order of cost estimates
and cost plans:
(e.g. as distinct rates & prices, detailed elemental cost analysis,
element unit rates, cost/m2 of gross internal floor area).
10) Certificate of Bona Fide Tender:
It is completed by the tenderer to confirm that he has not
communicated his tender to other parties.
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Quantification and Costing of Construction Works

11) SMoMs available in the Industry:

POMI,
CESMM (latest edition CESMM 4),
NRM1, NRM2 and NRM3,
SMM7 (replaced by NRM 2),
RICS Code of Measuring Practice (a standard code), and
SLS 573, etc.

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Quantification and Costing of Construction Works

12) Selection of a SMoM to a project:
To consider:
type of works,
familiarity of the SMoM in the region,
level of details required,
locally or internationally use, and
project / clients requirements (e.g. NRM1, NRM2 and
NRM3 a suite of documents for a complete
quantification and costing of building project).
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Quantification and Costing of Construction Works

13) Principles of Measurement International (POMI):

for works of construction (it means civil engineering and building

works),
first edition, June 1979, reprinted in 2004 (latest),
published by the RICS Business Services Limited,
published in several languages including Arabic, French and
German,
still widely used on international contracts as well as mostly used
in the Middle East,
contents: Section GP (General Principles), Section A (General
Requirements), Section B (Site Works) Section R (Electrical
Eng. Ins.) and Appendix, and
amendments to be recorded in Appendix (in practice;
amendments included in BoQ preambles stating the MoM).
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Quantification and Costing of Construction Works

14) Civil Engineering Standard Method of Measurement (CESMM):
intends to use for preparation of BoQ only for civil engineering
works and simple building works incidental to civil engineering
works,
first edition (1976), second edition (1985), third edition (1991)
and fourth edition (2012),
published by the Institution of Civil Engineers (ICE) UK,
not intend to use with complex mechanical and electrical
engineering work, complex building work or work which is seldom
encountered in civil engineering works,
New look CESMM4 (fourth edition-2012):
in 2009, it was suggested that the industry had changed
significantly since CESMM was introduced over 35 years ago.
Accordingly, ICE decided an update was indeed necessary,
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Quantification and Costing of Construction Works

New look CESMM4 (fourth edition-2012) (contd):
it incorporates the newest technologies so that it is completely up-to-date
with current practices,
contract neutral so it can be used across a variety of contract suites
including with NEC, FIDIC and ICC (CESMM3: CoC means ICE CoC, sixth
edition, January 1991 and industry used it with other CoC along with
required amendments),
document is generally national standard neutral, so it means there is
limited reference to British or other national standards and that
information must be given elsewhere on the drawings or in the
specification.
however, there are two exceptions to this principle where it has proved
impossible to produce bill items without reference to some form of
standard classification. These are Concrete Mixes and Road
Construction,
includes a completely updated Rail System,
very importantly, it retains the established structure of CESMM, and
contents: Section 1 (Definitions), Section 2 (General Principles) and
Section 8 (Work Classification: Class A-General Items to Class Z-Simple
Building Works Incidental to Civil Engineering Works).
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Quantification and Costing of Construction Works

15) What is your understanding about New Rules of Measurement?
based on UK practice, yet applied in worldwide,
the RICS New Rules of Measurement (NRM) is a suite of documents
(complete package) issued by the RICS Quantity Surveying and Construction
Professional Group and they are covering all aspects of the measurement and
description of a building project from cradle to grave (SMMs did not provide
specific guidance on the measurement of building works for the purpose of
producing cost estimates or cost plans),
The NRM suite comprises the following three volumes:
NRM 1: Order of cost estimating and cost planning for capital building works,
NRM 2: Detailed measurement for building works, and
NRM 3: Order of cost estimating and cost planning for building maintenance
works.
NRM 1 together with NRM 3 present the basis of good cost management of
capital building works and maintenance works which enabling more effective
and accurate cost advice to be given to the clients, and
link to download the suite: http://www.rics.org/uk/knowledge/professionalguidance/guidance-notes/new-rules-of-measurement-order-of-costestimating-and-elemental-cost-planning/.
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Quantification and Costing of Construction Works

16) NRM 1 - Order of Cost Estimating and Cost Planning for Capital Building Works:
second edition (effective from 1 January 2013),
this provides a structured basis for measuring building work and presents a
consistent approach for dealing with other key cost components associated with a
building project when preparing order of cost estimates and elemental cost plans,
it considered the cornerstone of good cost management of construction projects
which enables more effective and accurate cost advice to be given to the clients,
as well as facilitating better cost control,
this sets out the rules of measurement, format and presentation for the preparation
of order of cost estimates using the following estimating methods:
floor area method,
functional unit method (e.g. per bed space, per house type and per m2 of
retail area), and
elemental method (i.e. individual elements).
this sets out the rules of measurement, format and presentation for the preparation
of order of cost plan using the elemental cost planning method, and
definitions are given for the related terminologies such as cost limit, cost target cost
checks, etc.
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Quantification and Costing of Construction Works

17) NRM 2 - Detailed Measurement for Capital Building Works:

first edition (effective from 1 January 2013),

NRM 2 replaces the Standard Method of Measurement for Building Works (SMM), which was first
published by RICS in 1922, with the latest edition being SMM7, published in 1988,
this provides fundamental guidance on the detailed measurement and description of building works
for the purpose of obtaining a tender price while addressing all aspects of the BoQ,
guidance is also provided on the content, structure and format of BoQ, as well as the benefits and
uses of BoQ,
also provides fundamental guidance on the quantification and description of building works for the
purpose of preparing quantified SoW and a sound basis for developing SoR,
provides direction on how to deal with items that are unquantifiable is also provided (e.g.
preliminaries, risk, etc.), and
measurement and description is divided into the work sections (e.g. in-situ concrete works, precast
concrete, masonry, carpentry, the like), the format is as follows:

Item or work to
Unit Level one
be measured

Level two

Level three

Notes, comments and glossary

1 Poured on or
against earth or
unblinded hardcore.

1 Mass concrete is any unreinforced bulk

concrete not measured elsewhere.
2 The volumes of each type of mass
concrete work may be aggregated or
given separately.

Plain in-situ concrete

1 Mass concrete

m3

1 Any
thickness.

1 In filling voids.
2 In trench filling.
3 In any other situation:
details stated.

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Quantification and Costing of Construction Works

18) NRM 3 - Order of Cost Estimating and Cost Planning for Building
Maintenance Works:

first edition (effective from 1 January 2015),

provide essential guidance on the quantification and description of
maintenance works for the purpose of preparing initial order of cost
estimates during the preparation stages of a building project, cost
plans during the design development and pre-construction stages of a
building project,
provide direction on how to quantify other items associated with
building maintenance works, which are not reflected in the
measurable maintenance work items (e.g. maintenance contractors
management and administration charges, overheads & profit,
consultants fees and risks allowances in connection with
maintenance works),
NRM 3 follows the same structure and principle as the NRM 1, and
does not deal with operational cost.
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Quantification and Costing of Construction Works

19) What do you mean by RICS Code of Measuring Practice?

sixth edition (effective from September 2007),

the code is intended for use in the UK only,
a guide for property professionals,
the purpose of the code is to provide brief, precise
definitions to permit the accurate measurement of buildings
and land, the calculation of the sizes (areas and volumes),
and the description or specification of land and buildings on
a common consistent basis, and
includes three core definitions that are used in a variety of
situations. These definitions are gross external area (GEA),
gross internal area (GIA) and net internal area (NIA).

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Quantification and Costing of Construction Works

20) Can you list out major differences between CESMM vs POMI?
CESMM
published by the Institution of Civil Engineers
(ICE) UK
use for civil engineering projects and simple
building works incidental to civil engineering
works
more descriptive [items are measured under
divisions (1st, 2nd, etc.) and various rules
(measurement, definition, covering, etc.]
preliminaries are measured under General
Items
works are categorized under Work
Classification Class A to Z
coding system for each item in the BoQ
method related charges are included
In-situ concrete is measured under provision
and placing, etc.

POMI
published by RICS Business Services
Limited
use for works of construction (civil
engineering and building projects)
concise

preliminaries are measured under

General Requirements
works are categorized under
Section A to R
not available
not applicable
measured together, etc.
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Quantification and Costing of Construction Works

21) As per POMI, how do you measure the ductwork?

rectangular ductwork shall be measured by weight (Kg)

including fittings, and
circular, oval and flexible ductwork shall be measured by
length (m) enumerating fittings (excluding test holes and
covers).
(please also have a look of measuring of Piling (driven, bored
and sheet) as per POMI).

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Quantification and Costing of Construction Works

22) BCIS Elemental Standard Form of Cost Analysis:
Standard BCIS format, fourth (NRM) edition (2012),
published by BCIS (BCIS is the Building Cost Information Service of
RICS),
take account of some practical issues that have come to light in the
drafting of measurement rules for designed elements and
components for NRM1 and NRM3 (the use of the common
elemental definitions and cost breakdown structure is required). The
elemental breakdown structures are fully aligned,
describes the rules for preparing an elemental cost analysis in
standard BCIS format and it sets out:
the principles of analysis,
instructions on the information required to complete a costs analysis;
general definitions,
definitions of the elements and sub-elements, and
element unit quantities.
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Quantification and Costing of Construction Works

23) Cost Analysis:
it is a systematic breakdown of how cost has been distributed over the
elements of a building (or it is the analysis of the cost of a building in
terms of its elements),
in other words, it is a full appraisal of costs involved in previously
constructed buildings and is aimed mainly at providing reliable
information that will assist in accurately estimating cost of future buildings,
group elements: substructure, superstructure, internal finishes, fittings &
furnishing, services, prefabricated buildings & building units, work to
existing building and external works,
to be prepared based on tender BoQ (accepted contract price) as the final
account includes variations, claims, etc., and
to be prepared ASAP after tenders have received due to familiarity with
the project and currency fluctuation.

24) Benchmark Data:

Standard or a set of standards used as a point of reference for evaluating
performance or level of quality.

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Quantification and Costing of Construction Works

25) How to provide a Structured Answer:

golden rule (chairmen/assessors to follow):

why am I asking this question?
what competence does it relate to (Pathway Guide)?
what level am I probing (Pathway Guide)?
am I allowing the candidate to demonstrate their actual
experience?
what response am I expecting?
e.g. what are the SMoMs you are familiar with?
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Quantification and Costing of Construction Works

26) Principle behind Rejection of Options and Selection of a
Most Suitable Option in a Case Study:
The issue:
assumed that a T20 cricket match (SL vs Pakistan 2017
series) will be started at 3.00pm at Dubai Cricket Stadium.
you are in Sharjah right now, time at 2.00pm,
your phone is switched off & as well as, there is no a
navigator, and
which road are you going to select?
(please see the elastration given in next slide)
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Quantification and Costing of Construction Works

feasible options,
consider to go (but not physically going),
pros and cons,
rejecting options with reasons, and
selecting the most suitable option with reasons.
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Quantification and Costing of Construction Works

27) Sharing the experience / thoughts of recent RICS APC Interviews:

good first impression

positive attitude,
be calm (not at all panic),
show the confidence,
good case study presentation,
adequate competency knowledge,
all the aspects of conduct rules, ethics and professional practice, and
give the answer to the point and then go on/keep talking, etc.

28) Supplementary:

taking off sheets should always be accompanied the used drawings,

when costing, round up the figures (do not keep the decimal places), and
use the original books (SMOM, CoC, etc.) at practice (avoid using
photocopies).
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Quantification and Costing

of Construction Works

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