Cost Management

ABPL90312

LECTURE 1a
INTRODUCTION

Welcome!
Subject Coordinator: Gao Shang
Senior Lecturer in Construction Management
Teaching ‘measurement’ subject since 2014
many of my former students worked as QS, estimator and CA
 Agenda

1) Introduction to ABPL90312
2) Course Assessment
3) Measurement (QTO)

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 Introducing ABPL90312
(lecture and tutorials)

Indicative Workload:
• Approximate 120 hours of effort or total load (contact and
non-contact including assessment); approximately 10 hrs per
week but remember this is an average.

Course Contact Hours:

• Lecture: 2 hours per week for 12 weeks
• Tutorials: 2 hour per week for 12 weeks

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 Introducing ABPL90312
(Learning objectives)
On completion of this course students should be able to:
• Be able to describe the role of Quantity Surveyors (QS)/Estimator
• Be able apply the Australian and New Zealand Standard Method of
Measurement (ANZSMM) to quantification of the works for simple
buildings.
• Be able to measure and prepare Bills of Quantities for (1) masonry; (2)
roofing; (3) finishes; (4) groundworks; and (5) concrete, reo, and
formwork.
• Be able to price measured building work items.
• Be able to describe the application of computer software to
measurement of building works.

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 Introducing ABPL90312
(attendance requirements)

• Attendance/class requirements:
“Attendance and participation in 80% of the
tutorials is a mandatory requirement for
passing the continuous assessment
component of this subject.”

(Subject Description, page 3)

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Weekly
topics

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 Introducing ABPL90312
(Key textbook)

• Australian & New Zealand • Marsden, P. (1998) Basic

Standard Method of Building Measurement,
Measurement of Building NSW University Press,
Works (ANZSMM, we will refer N.S.W. (good old examples!)
to it as “the method”)

superseded

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Please note AIQS has a discount
available for AIQS Student
members, which is 15%. AIQS
encourages university students to
become AIQS Student members https://www.aiqs.com.au/shop/australian-and-new-zealand-
in order to secure the discount. standard-method-measurement-building-works-anzsmm

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 Introducing ABPL90312
(Assessments)

THREE assignments (100%)

Assignment 1 - Practical exercise (group assignment – 25%) using residential
building focusing on measurement of:
• 1a - Masonry (brickwork)
• 1b - Various Finishes and Painting

Assignment 2 - Practical exercise (individual assignment – 50%) focusing on

measurement of:
• 2a - Groundworks
• 2b - Concrete/Reo/Formwork

Assignment 3 - Group assignment (25%) focusing on production of Priced BOQ

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 Introducing ABPL90312
(Group Assessments)

• Group assignment – group of TWO students

• Each group will be responsible for allocating the work among
the members
• you are required to include a diary of meetings of the group
including those present, what was discussed, allocation of
tasks and report, progress to date
• The submission should also indicate the contribution of each
member of the group
• All members of the group will score equal marks except in
cases where individual members contribute minimally

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 Introducing ABPL90312
(Assessments)

• The assignments will take time

• If this is your first attempt at measuring/estimating, they will
be difficult until you grasp an understanding of the methods
used – don’t be afraid to ask (i.e. discussion board)

DO NOT UNDERESTIMATE THESE ASSIGNMENTS!

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 Introducing ABPL90312
(discussion board)

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 Introducing ABPL90312
(Assessments)

• The assignments will take time

• If this is your first attempt at measuring/estimating, they will
be difficult until you grasp an understanding of the methods
used – don’t be afraid to ask (i.e. discussion board)
• The pace will be constant and the deadlines will come very
quickly!!!
• These are not the type of assignments that can be completed
quickly at the last minute
• You are training to be a construction manager/QS so manage
your time

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 Assessment (This year’s Project)

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 Ground floor plan

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 Roofing plan

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 Elevation(s)

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 What is this?

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 Assignments 1-2

Double column
dimension paper (calc
sheet)

Note, you will need to

print many calc sheet
(dimension paper)

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 Assessment criteria

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 House keeping

• Everyone is a potential H1 student

• Employers may not understand what is
included in some courses but they understand
“building measurement” or “cost
management” as a fundamental skill in our
construction industry
• You cannot manage something if you do not
understand the extent

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MEASUREMENT
 General Principles
Measurement links design and cost
Pricing the Completion of
works estimate
Procurement
Quantity
Take-off X
DESIGN COST
quantities
Unit Rate

• Measurement or “quantity take off” (QTO) is the way we calculate the

quantities of construction work
• In order to manage or price an activity of work it must be measured
• It is difficult to manage something if the extent is unknown
• ANZSMM “the method” is the main set of rules for measuring

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 The development cycle and cost management

Final
Feasibility Cost Planning Tendering Contract Administration Accounts

Design &
Inception Construction
Documentation In Use

Development Period

Feasibility and Initial Budget

• Client has land and/or a need for a building
– May have an idea of what is needed, e.g. 30 units
– May only have a verbal description, e.g. 30 units x 2 beds with en-suite, solid gold tapware
and double secure car parking, also must have a pool and gym at the complex
– May have some rough sketches (schematics)
– Measurement to establish an initial budget for the project
– Measurement to enable feasibility analysis
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 The development cycle and cost management

Final
Feasibility Cost Planning Tendering Contract Administration Accounts

Design &
Inception Construction
Documentation In Use

Development Period

Cost Planning
• Client has agreed to the project budget and the scope set out in the initial budget (often after some
tweaking throughout the feasibility process e.g. delete the solid gold tapware – it won’t increase
the sale price)
• The designer’s drawings (architect) must be measured regularly to make sure the scope in the
budget is maintained, e.g. she/he doesn’t try to sneak the solid gold tapware back into the project
• Drawings are measured and priced at intervals and the adjusted costs are reported
• Measurement is in set “elements” to enable easy manipulation and comparison with other projects

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 The development cycle and cost management

Final
Feasibility Cost Planning Tendering Contract Administration Accounts

Design &
Inception Construction
Documentation In Use

Development Period

Tendering
• When the architect’s documents are complete and ready for tender, a BOQ is
required
– The BOQ can be prepared by the owner’s QS and given to the tenderers (builders)
– The BOQ can be prepared by the tenderers. Each prepares their own.
• Tender prices can be compared and analysed

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 The development cycle and cost management

Final
Feasibility Cost Planning Tendering Contract Administration Accounts

Design &
Inception Construction
Documentation In Use

Development Period

Contract administration
• In the period:
– after the tenders are analysed and one builder is given the job (awarded the contract) and,
– before the end of the defects liability period (often 1 year after completion of the work)
• Measurement is necessary to assess progress claims
• Measurement is necessary to assess variations, claims for extension of time (EOT) and
liquidated damages (LDs)
• Builders also need measurement to enable them to deal with subcontractors during
this time
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 The development cycle and cost management

Final
Feasibility Cost Planning Tendering Contract Administration Accounts

Design &
Inception Construction
Documentation In Use

Development Period

Cost Control
• During the project there may be cost control where costs are reported back against:
– the initial budget if it is by the owner
– the tender price if it is by the builder
• Measurement is necessary to determine the extent of work done during the period
and the extent where work has been committed but funds not received/expended

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 Measurement

• Measurement occurs throughout the entire process

• We are concentrating on the BOQ stage
• This skill can be utilised at all stages
– Initial budget (feasibility)
– Cost planning (alternatives & control)
– Tendering (BOQ & tendering)
– Contract administration (progress claims, variations, subcontract
letting & negotiations)
– Cost control (can be part of post contract admin)
• Throughout all these items, measurement is necessary to
ascertain the extent mainly of time and cost

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 After this subject…

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 ANY QUESTION?

Thank you!

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