Amber Book - Pro Practice Flashcards
What is indeminification?
When one party accepts the liability for any mistakes ahead of time.
What is an addendum?
Addresses changes before bidding. These will impact the cost of construction.
What is an allowance?
A sum of money decided upon for future construction costs that may change during design & bidding.
What is a change order?
A change made after bidding has concluded. The contractor will request these to the owner & architect.
What is a construction change directive?
When the architect tells the contractor to change something.
What types of insurance may be found in B101?
- Automotive
- General Liability
- Professional Liability
- Workers comp
Who owns the drawings and specs?
The Architect!
Think about this, the owner may not take the drawings from their building and go build the same thing somewhere else.
What is Grossing Factor?
Rentable Area / Usable Area
Areas like restrooms in the core may be rentable (because you may be renting that whole floor out), but these areas are not usable for the function of the business renting the space.
What is the Overhead Rate?
Total Overhead Expenses (dont forget indirect) /
Direct Salary Expenses
Total overhead is often indirect salary + benefits + other overhead
How do you calculate Break-Even Rate?
[Direct Salary + Expenses (Indirect salary + benefits + overhead)] / Direct Salary
Always will be Overhead rate + 1
How does one calculate the Direct Salary Expense (DSE) multiplier to make a profit?
Direct salary + total overhead + profit target = Direct Salary Expense Multiplier
What is the Revenue Factor?
Utilization Rate x DSE Multiplier
Measures firm profitability. You really want anything higher than 2
What is a Negotiated Select Team delivery method?
The contractor is brought in early.
Difficult to fabricate portions can be started early. This makes things quicker and higher quality.
What are the implications of different bidding types?
Negotiated bid = better quality
Competitive bid = lower construction cost
Invited bid = special qualifications needed for program
What is an SPI?
Schedule Performance Index. How much you HAVE been paid so far for a project divided by how much you SHOULD have been paid so far.
Tracking this number for each project is important
What is defined in the Fair Labor Standards Act?
- Min wage
- Who gets overtime
- Forbids child labor
What is defined in the Davis-Bacon Act?
- Fair local wage should be paid
What does OSHA stand for?
Occupational safety and health administration
What is a phased bid?
- Fast track construction
- Design and fabricate before plans finalized
What is a Negotiated Bid?
- Contractor comes on early
- Final bid between contractor and owner
- Increases quality, raises costs
What is a Tender?
Just another word for bid
What is a Invited Bid?
- D-B-B
- Only open to prequalified (invited) contractors
What is a bid bond?
- If the low bidder doesn’t follow through, this bond will fill the gap up to the next lowest bid.
What is a performance bond?
The third-party insurer offers to pay for the project to be completed if the contractor defaults.
What is a business performance bond?
Insures against business failures that cause the job to fail. Stolen intellectual property for example.
What is a Contractor’s Licence bond?
- Insures contractors against breaking construction laws.
Who pays for a delay in construction?
Likely this is the fault of the contractor. So the contractor and owner will pay for this, not the architect.
What is included in a Contractor’s Application for Payment?
- Change order summary
- Amount of $$$ needed to complete project
- Amount of current retainage for work-in-place
- Amount of current retainage for stored materials
- Certification that the contractor’s subs have been paid
What is retainage?
Money owed to the contractor but intentionally not paid yet
What are the distances for westernized personal space zones?
1.5’ - Intimate
4’ - Personal
12’ - Social
25’ - Public
What essentially is Net Operating Revenue (NOR)?
What’s coming in, money wise, minus what’s going out (salary, etc.)
What is Net Profit?
Amount left after you’ve paid everyone who works for you and your bills, but before you’ve paid taxes and distributions.
What is the formula for Profit/Earnings Ratio?
Profit /
Net Operating Revenue
What are Current Earnings?
The remaining profit for the firm to keep after taxes have been paid and the principles get their share.
What is the main difference between Cash Basis Accounting and Accrual Basis Accounting?
Cash Basis is counting only what money has been received and paid. Accrual Basis also includes what is owed
What is net billing?
Fees just for the architect’s time. Does not include expenses or other reimbursables.
What items are found in a Profit/Loss Statement (P/L)?
- Utilization Rate
- Overhead Rate
- Break-Even Rate
- Net Multiplier
- Profit to Earnings Ratio
- Net Revenue Per Employee
- Aged Accounts Receivable
What is considered too long for a client to pay Aged Accounts Receivable?
90 days typically
What is solvency?
Total current assets /
Total current liabilities
Should be at least 1.5
What is Liquidity?
Cash on hand + accounts receivable + revenue
/
Liability
What is Leverage?
Liabilities / Equity (equity is everything you own)
What is Return on equity?
Profit / Equity
What is equity?
The value of the firms stock, investments by shareholders, and the money the firm has made and kept.
Equity = Assets - Liabilty
What are the kinds of profitable architecture firms?
Efficiency - cheaper & faster, more routine repeatable elements, one sector of the market, more junior staff
Experience - (most common) more complex routine projects, a specialization in hospitals for example.
Expertise - Pritzker winners. Deep knowledge or talent. Mostly senior staff
Contractually, what are the two biggest expectations for an architect?
To be on schedule, and to be on budget.
How long does an architect typically have to respond to an RFI?
2 Weeks! But can vary with contract
What does it mean that an Owner can fire an Architect “for convenience”?
It means that the owner can fire the architect just because they feel like it.
What are in the C-Series of AIA documents?
Arch-Consultants
&
IPD
What are in the D-Series of AIA documents?
Misc
What are in the E-Series of AIA documents?
Electronic communications! Who is responsible for security and storage of electronic files (PDF sheets, meeting minutes, etc.)
What are in the G-Series of AIA documents?
Admin & Project Management
What is the difference between Liquidated and Consequential damages?
- Liquidated Damages are immediately measurable quantities that were a direct result of the error
- Consequential damages may occur as a secondary result of the error, but are sometime hypothetical or hard to prove.
What are direct damages?
Damages for an error or omission on the part of the architect for a specific problem. Architect can only be liable for an amount as in their contract (not always up to the amount to fix the problem)
What are some examples of submittals?
- Product data sheets
- Product samples
- Shop drawings
What is an Overlay District?
A zoning area where incentives are offered (higher buildable height) if a project is willing to appease a desired demand (LEED, green roofs, underground parking, etc.)
What is a Planned Use Development (PUD)?
Exactly what it sounds like! A change in the zoning code for a site that gets approved for Developing a pre-determined Use.
What is the difference between Free Float Time and Total Float Time?
Free - how long something can be delayed without delaying the next construction activity in the schedule.
Total - how much slack is available for the total project by adding earliest and latest start/finish dates
What is the difference between Life Cycle Analysis LCA and Life Cycle Costing LCC?
LCA - Focused on energy performance
LCC - Focused on the cost of purchasing/financing, installing, repairing and maintaining materials, products or systems over their lifespan
What does the numbering system for rebar translate to?
Eights of an inch!
a #2 rebar is 2/8” or 1/4”
a #4 rebar is 4/8” or 1/2”
a #10 rebar is 10/8” or 1-1/4”
What project types are the Design-Build method best for?
Straightforward building types with experienced clients.
What type of project is best for the Fast-Track method?
Projects that need speed over quality.
Because design and construction can overlap, buildings can be built in a series, one right after the other.
What types of projects are good for CMAR or Construction Manager at Risk?
Projects with complex construction. Bring the contractor in early to provide input.
What is the main benefit of Integrated Project Delivery (IDP)?
Value is maximized and waste is minimized because several experts came together early when major building systems are being selected.
