Prior to, or on the assessment date, it is the Contractor’s responsibility to submit an application for payment, this is commonly undertaken by Contractor’s quantity surveyor. The assessment interval is identified within Contract Data Part 1.
On each assessment date, the quantity surveyor should be present on site to review and evaluate the application for payment as well as, the PWDD (Price for Work Done to Date). This is often in conjunction with the NEC Supervisor and Contractor’s quantity surveyor.
The Secondary Option clauses, chosen for the project must be reviewed by the quantity surveyor. For example, if X16 Retention has been selected, the quantity surveyor will check the retention percentage (this can be found within Contract Data Part 1). Furthermore, the quantity surveyor must also check the retention free amount (if any), this is the value that no retention will be applied to, for example, the first £100k will not be subject to retention, any value thereafter will be.
Following the above steps and any amendments, the quantity surveyor will advise the Project Manager on the amount due to be paid and details of the assessment of said amount, this information must also be provided to the Contractor. Note, it is the Project Manager’s responsibility to issue the payment certificate once the PWDD has been calculated and advised by the quantity surveyor.
Within 1 week of the assessment date, it is the role of the Project Manager to issue the payment certificate to enable the Contractor to submit their invoice and to facilitate the payment. A good quantity surveyor will understand the importance of adhering to the dates specified within the contract as it of the utmost importance to enable appropriate cash flow for the Contractor and to ensure the Client’s financial procedures are adhered to.
A proactive quantity surveyor will report the financial position of the project to the client ideally monthly (or more frequently if required).
The added value this brings to the Client is a well drafted and informative cost report will assist in the Client’s management of internal finances and to understand if the project is on budget, and if not why?
The cost report is to ensure the project’s budgetary requirements are being met, and to advise the Client if the application for more funding is required, or if there are any potential opportunities for the Client to consider value engineering the scheme. Without frequent and well-written cost reports from the quantity surveyor, the client would not understand the financial position of the project and will not be able to make informed decisions regarding finances.
Generally, included within the cost report is the following: