ABSTRACT
It is interesting to bring to light the demands challenges and development in the twenty-first century the key role of the quantity surveying profession in the economic with emphasis on an appraisal of the quantity surveyor cost control in Nigeria construction industry. The work shall attempt to explore the quantity surveyor who is essentially cost expert whose prime task is to ensure that contract sum of project is kept within the client’s approved budget (cost limit) and resources of the construction industry are used efficiently to serve the best interest of the society. These factors of control of cost of project by design the team throughout both design and constructional processes and the methods by which the contractor monitors and regulates the cost of construction on site are the chief concern of the quantity surveyor which will be will be treated in this work. This work shall be of vital benefit to client consultant etc on an effective cost control procedure both pre-contract and post contract stages of the project to keep its cost within the budget cost limit and quality balance of time in the construction industry.
TABLE OF CONTENT
TITLE PAGE ………………………………………………………………………..i
CERTIFICATION ……………………………………………………………………i
DEDICATION………..……………………………………………………………..ii
ACKNOWLEDGEMENT……………………………………………………….…iii
SYNOPSIS ……………………………………………………………………..…vi
TABLE OF CONTENT …………………………………………………………….v
LIST OF TABLES…………………………………………………………….……vi
CHAPTER ONE
- INTRODUCTION ……………………………………………………….….1
1.1. BACKGROUND TO THE STUDY …………………………………..……1
1.2. STATEMENT OF THE PROBLEM ……………………………………….5
1.3. THE STUDY OBJECTIVES ………………………………………………5
1.4. RESEARCH QUESTIONS…………………………………………………6
1.5. HYPOTHESIS………………………………………………………………6
1.6. THE SIGNIFICANCE OF THE STUDY…………………………………..6
1.7. THE SCOPE AND LIMITATION………………………………………….7
1.8. DEFINITION OF TERMS………………………………………………….7
CHAPTER TWO
2.0 LITERATURE REVIEW ……………………………………………………………..9
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2.1 QUANTITY SURVEYORS COST CONTROL ACTIVITIES IN NIGERIA CONSTRUCTION INDUSTRY………………………………..9
2.1.1. FEASIBILITY STUDIES…………………………………………………10
2.1.2. PRELIMINARY COST ADVISE…………………………………………10
2.1.3. COST PLANNING……………………………………………………..…11
2.20. THE PRACTICE OF CONTRACTING IN CONSTRUCTION INDUSTRY…………………………………………………………………12
2.2.1. BUDGETARY CONTROL IN CONSTRUCTION INDUSTRY………..13
2.2.2. PROJECT EXECUTION …………………………………………………14
2.2.3. DUE PROCESS…………………………………………………………..16
2.3.0. TENDERING AND ESTIMATING ………………………………………16
2.3.1. TENDERING PROCEDURE ……………………………………………18
2.3.2. OPEN TENDERING ……………………………………………………..20
2.3.3. SELECTING TENDERING ………………………………………………20
2.3.4. NEGOTIATE TENDERING………………………………………………21
2.4.0. COST CONTROL…………………………………………………………22
2.4.1. PRE CONTRACT COST CONTROL……………………………………22
2.4.2. POST CONTRACT COST CONTROL…………………………………22
2.5. VARIATIONS………………………………………………………………23
2.6. FINANCIAL REPORTING………………………………………………..24
2.7. FINAL ACCOUNT…………………………………………………………..24
2.8.0. THE QUANTITY SURVEYOR IN THE NIGERIA CONSTRUCTION INDUSTRY……………………………………………………………………25
2.8.1. ACCOUNTABILITY …..…………………………………………………..26
2.8.2. MANAGEMENT OF INFLATION AND RISK FACTORS…………….26
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2.8.3. ENSURING VALUE FOR MONEY…………………………………..…27
2.8.4. ELIMINATING PROJECT ABANDONMENT…………………………..28
2.8.5. MAINTAINING COST DATA FOR THE CONSTRUCTION
INDUSTRY…………………………………………………………………….28
2.8.6. BUDGET ANALYSIS OF ALL CONSTRUCTION PROPOSAL………29
2.8.7. ENSURING EFFECTIVE FINANCIAL MANAGEMENT WITHIN CONTRACTING ORGANIZATION ……………………………………29
2.8.8. ARBITRATION AND DISPUTE RESOLUTION…………………….…30
CHAPTER THREE
3.1. RESEARCH METHODOLOGY …………………………………………31
3.2. POPULATION OF STUDY ………………………………………………31
3.3. SAMPLING DESIGN AND PROCEDURE ………………………….…32
3.4. DATA COLLECTION INSTRUMENT ………………………………..…32
CHAPTER FOUR
4.0. PRESENTATION AND ANALYSIS OF DATA…………………………33
CHAPTER FIVE
5.0. FINDINGS, CONCLUSION AND RECOMMENDATION……………..44
5.1. FINDINGS…………………………………………………………………..44
5.2. CONCLUSION…………………………………………………………….45
5.3. RECOMMENDATION……………………………………………………..47
5.3. REFERENCE…………………………………………………………………49
APPENDIXES………….…………………………………………………………..54
LIST OF TABLES
- Breakdown of the distribution and response
- Type of organization
- Designation
- Area of Specialization
- Academic qualification
- Professional qualification
- Quantity surveyor’s major role
- Quantity surveyor’s ability to achieve reduction in cost.
- Assessment of the impact of quantity surveyors in contract administration in the Nigeria Construction Industry
- Occurrence of corrupt practice during selection of contractors
- Positive impact of quantity surveyors in the Nigeria construction industry
- Frequency of involvement of quantity surveyor in cost control
- Factors affecting cost control of construction project in Nigeria
- Stages of project development for which other consultants and clients are willing to appoint quality surveyors.
- Adequacy of Nigeria quantity surveyors in terms of numerical strength and qualitative competence.
CHAPTER ONE
- INTRODUCTION
1.1. BACKGROUND TO THE STUDY
The quest for accurate value for quality work today, as in the past, has been on according to the Bible in (Luke 14:28-30), the king been James version: For which of you intending to build a tower sitteth not down first and counted the cost whether he has sufficient to finish it, list aptly after he had laid the foundation and is not able to finish, all that behold it began to mock him saying, “this man began to build and was not able to finish”. This is the inauguration of the quantity surveying.
Ashworth and Hogg K.(2002) affirms anyone proposing to construct a building or engineering structure will need to know in advance the probable cost involved in the works, these costs include. The cost of construction, infrastructure cost, professional fees, disposal cost. Interest rate, developers profit, construction time etc Ashworth and Hogg. K, (2002) summits in addition to there sum, the client or promoter on civil engineering projects will also need to make provision or costs of site and the fitting out and furnishings that are required in the completed project. Many of these costs are often excluded from the normal process of construction project cost control. The need by the client to know the best way of carrying out his project under any given circumstances had made it compulsory that flexibility in application of cost planning which must be seriously adopted. This means that a thorough understanding of issues involved and their resolution is required by one or whose shoulders this social responsibility is borne according to the Nigeria institute of Quantity Surveyors, (1980) the quantity surveyor is the expert in cost procurement and project management therefore the responsibility is squarely on his shoulders. According to Douglas J. Terry and Peter S. Brandon (1980), clients are increasingly cost conscious as industrialist are concerned with profitability. “There is therefore, no tailor-made method or any hard and fast rule on how to cost, procure and manage a project other than consistent and conscious application of the principles of the profession” J. C. Obieze (2007). Since it is the duties of the Quantity Surveyor to ensure that the building to be constructed is carefully controlled, in terms of cost arising throughout the entire design and construction process. The focus of cost control must be balanced with the importance of value in terms of what is being provided for a client.
The construction sector is a vital part of ant economy because of its size and the potential role it can play in the developing efforts of the economy. Construction is often used as an indicator of social – economic development of a nation and therefore, it is indispensable in the process of socio-economic development. Its contribution to the nation economy is well represented through construction value addition, investment, employment, trade balance and sectoral linkages but, unlike other sector, construction sector delivers its products to unique and sometimes, exceptional prerequisites of topographical and geographical condition of exterior environment where change is a norm. Such changes drives have always made the professional in the construction industry to relate and narrate new condition with experience. Quantity Surveyors, as well as other key players in the construction team meet with new conditions which demand them to manage their professional knowledge effectively.
According to Willis Ashworth (1987,p2) the quantity surveyor is one who ensures that the resources of the construction industry are utilized to the best advantages of the society by providing, interalia, the financial management for project and cost consultancy services to the client and designer during the whole construction process. As emphasized, being one of the key professional experts in the construction sector, Quantity Surveyor have the utmost responsibility to address the key cost, financial and constructional issues of the environmental parameters, which are very sensitive to changed and are unique for every project. These key drivers have made the professional in the construction industry to relate and narrate new condition with existing knowledge and past experience on cost control.
The increasing complexity of construction arrangements arising cost, rapid changes in technology and specialization with over increasing number of roles to be manages as well as the correspondingly, increasing volume and values of construction output, have resulted in an ever more pressing need to properly managed these variables. This is to ensure that the aim of construction contracting is achieved under a balance system that ensures that the most advantageous use of available resources, In a developing nation like Nigeria, the role of the construction industry is very much crucial as it provides employment and the infrastructures necessary for development. To this extent, the volume of activity in the construction industry has been used to as source for measuring the overall development of a country is a direct measure of the level of economic development of that country Babangida (1992) asserts that a careful surveying of the economic landscape of our country since independence would reveal that the importance of quantity surveyors as the statutory recognized professional cost adviser on all construction projects can not be over emphasized and since it is true that no such projects can be executed without the invaluable input of quantity surveyors. It become easy to see why they assumed such a central role in the socio-economic progress of this nation, hence a quantity surveyor by virtue of his training has total contractual and cost control knowledge and after reasonable predication and advise on total building cost, thus becomes the recognized construction professional in the financial aspect of contract administration.
1.2. STATEMENT OF THE PROBLEM
The lack of cost control in the Nigeria construction industry has resulted to poor quality of standard of work, unhealthy professionalism, practice and a perceptive imbalance on the standards of various administrations adopted in Nigeria. According to Onyeador (1990) where he stated, “we are all aware of the astronomical cost overruns of the most of our completed project and various project abandoned at various stages of completion all over the federation, this will definitely show that there is something wrong with the way in which our construction project are managed and executed.”
1.3. STUDY OBJECTIVES
The aim of the study is to create a better understanding of the roles of the quantity surveyor in cost control activities in Nigeria construction industry, to give the building client good value for money.
To establish the importance of prudent in resources allocation and a balance and logical distribution of the available funds between the various parts of the building and to keep total expenditure within the amount agreed by the client.
1.4. RESEARCH QUESTION
- what extent does the Nigeria Construction Industry and the Government appreciate cost control as exercise of due process.
- What extent do quantity surveyor cost control impact on construction industry help in effective procurement in Nigeria.
- To what effect the client and public know and appreciate the quantity surveys role in the construction economy.
1.5. HYPOTHESIS
The government neglecting the capacity of the quantity surveyor cost
control in economic development process in nation building does have impact on the construction industry in Nigeria.
The quantity surveyor cost control in the country construction industry has not achieved reduction in cost of construction and poor quality of workmanship.
1.6. SIGNIFICANCE OF THE STUDY
In any construction project the cost control is a function of how well the contract has been managed. A well managed contract is the one executed within time and cost budget.
This study will enable us go into those managerial defects in the current situation of the country.
1.7. SCOPE AND LIMITATION
Construction activities are very wide in scope ranging from building, civil, petro-chemical and heavy engineering works.
Due to the fact that most quantity surveyors in Nigeria have been involved mainly in building works, a critical evaluation based on a wide range in this area will be considered, so the study works be restricted to building works also since the parties of the quantity surveyor is the same throughout the country, the study area for this research work is limited to south-east and south-south zone of Nigeria.
1.8. DEFINITION OF TERMS
Certain terms convey deferent meaning to different people where the terms are technical in nature and peculiar to a given discipline,
profession or a group of experts.
It is therefore imperative to define the major terms used in this study. The definitions are however, on the point of view of the quantity surveying profession and this thesis in particular.
Appraisal
An appraisal is a report by the beneficiary which normally incorporate the quantity surveyors report and send to “DUE PROCESS” for further action.
Quantity Surveyor
Nigeria Institute of Quantity surveyors, (1980) the quantity surveyor is the expert in cost procurement and project management. He is professionally trained, qualified and experienced in dealing with construction cost. Accordingly, Abdul (1990) is one who by virtue of his training and practice bears the responsibility for administrating the financial aspect of construction project from inception design, construction and maintenance to their terminal demolition.
Cost Control
Royal Institution of chattered surveyors, Report of Rics, (1970) defined
cost control as the total process which ensures that the contract sum is within the clients approved budget or cost limit.
Construction Industry
Seeley Ivor H., (1984) state that construction industry embrace a
wide range of loosely integrated organizations that collectively construct , altar and repair a wide range of different building and civil engineering structures.
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