Technical Competency Questions - TARGETTED Flashcards
How would you define fair and reasonable?
I would believe it would be considered by most people to be reasonable, right, or normal.
How would you financially manage sub-contractors/what techniques would you use?
- Payments
- EWNs
- Payment on time
- Contra-charges/levying costs
- Retention.
- Agreeing variations and claims when they occur
- Identify future variations as and when they occur,.
What did a Pay-Less notice used to be called?
- A withholding notice
Can you tell me about the Housing Grants, Construction and Re-Generation Act?
- is intended to ensure that payments are made promptly throughout the supply chain and that disputes are resolved swiftly.
- It includes the right to adjudication, right to suspend performance, etc.
What is the government payment charter?
NOW AMENDED: JAN 22 -
PAYMENT REPORTING REGULATIONS:
Sets out fair payment commitments for organisations in the construction industry to sign up and agree to. - All large contractors should follow the Construction Supply Chain Payment Charter. Now called the ‘Payment Reporting Regulations’ – changed in Jan 22. - This sets out fair payment commitments for companies and LLP’s - Public authorities are already required to pay within 30 calendar days. On central Government contracts, payment will be made to: - Tier 1 within 14 days, - Tier 2 within 19 days - Tier 3 within 23 days of the due date, which will be 7 days after the common assessment or valuation date established by the client in the Tier 1 contract.
Can you tell me about the Scheme for Construction Contracts?
- is a scheme which applies when construction contracts do not comply with the Housing Grants, Construction and Regeneration Act.
What are the components that make up the cost of a project to a contractor?
- Profits and overhead – staff, labour, materials, access equipment, prelims
How often do you report cost?
- Monthly however, we continually update the CVR when changes arise.
What is a cash flow forecast?
- A cash flow shows how much money the business or project expects to receive and pay out over a set period.
How do you use a cash flow?
- I use a cash flow by understanding what we’ve been certified from the client, how much money we have in the bank and then review what our sub-contractors have applied for and what else is to be paid (plant, material & labour etc). This helps me to understand what accruals I need to make
How do you manage risk and contingency?
- I manage risk by keeping a risk register and keeping this as a working document.
- Consistently having meetings with the engineers to understand the risks around and the contingency which has been allocated or removed.
What is CVR?
Cost Value Reconciliation
- Is the profit and loss statement for a project.
- Helps calculate the amount of work done to date and the cost incurred to date.
- It is the difference being the amount of profit or loss made at that point in time.
How can you calculate works completed to date?
- Visit site, carry out assessment and see what’s been done in line with what’s being claimed within a period
How do you know what costs you’ve incurred to date?
- By looking at what we’ve been charged for by a subcontractor or a supplier
- What we’ve paid out for in terms of material
What is the purpose of change control?
- Change control has three purposes:
1. All relevant parties are consulted
2. Enables change to be assessed in terms of time, quality and cost.
3. A record is formed to note any change.
What is EVA (Earned Value Analysis?)
- Is a method of measuring the projects progress at any given time.
- Forecasting it’s completion date and final cost
- Analyses the variance in the schedule and budget as the project proceeds
- Compares planned to work to that actually completed.
- Helps determine if works are progressing in line with programme.
What is the impact of change on cost?
Will depend upon if it is a domestic change or a client driven change
- Domestic will be negative
- Client will be positive.
How do you prepare a liability statement?
How do you prepare a cost value reconciliation?
It measures cost against the budget.
- I would firstly confirm the contract value/total which would be my starting point.
- I would look at the instructions in the period and update these and include these on my CVR
- I would then look at the Sub-contractor’s application and see if there are any changes or claims in the period from them.
- I would regularly update this document as soon as anything would arise.
- This would help me understand the work completed to date and ensure that we are on budget.
- This would give me a rolling ‘cost to complete’ on each package.
The client wants to make a change, how do you manage this?
- Implement the change control procedure.
How do you undertake the change control process?
- In my role, we would receive the PMI or change from the client.
- We would assess the change and upload this onto a change register
- I would then discuss the change with the relevant parties within CHt and we would then go to the Client if we needed further information.
- I would then start to pull together a quotation in line with the client’s requirements, clearly outlining our fees.
- I would then arrange a meeting to discuss this with the client with a view of gaining implementation.
- I would then review my documentation and close this out on the schedule with the cost clearly indicated.
What is a formal change control process?
PIMM:
- Propose change
- Impact Summary on project
- Make a Decision
- Make the Change
How did you deal with the potential movement of the PC date upstream?
- We firstly needed to clearly understand why the PC date had moved.
- It was clear that there was a lot of client change.
- I had a meeting with the Planner and Engineers who assessed each additional PMI/CE and we allocated additional time to this which gave a clearer indication of the programme and the potential new completion date.
- I then needed to advise the client of this so that we could get a contractually agreed EOT and get this implemented.
How did you ensure productivity was not reduced from the acceleration i.e working longer hours?
- Everyday there was a clear plan of works and what needed to be done and dates completion was required by; which was mutually agreed with the Sub-Contractor.
- We always agreed to pay for 2 extra hours but if the Sub-Contractor completed the tasks in a shorter period of time, we would pay the 2 hours as a bonus.
What further reading did you undertake on Isurv into building services?
- I looked into ‘Assessing Building Services’ mainly and this gave me an insight into inspecting electrical installations, water, heating systems and their fuels and drainage.
What are the most common services required in a building?
- Gas
- Water
- Electrical
- Mechanical
- Heating
What legislations affect the construction process?
- Construction (Design and Management) Regulations 2015
- Health and Safety at Work Act 1974
- Control of Substances Hazardous to Health Regulations (COSHH) 2002
- Lifting Operations and Lifting Equipment Regulations (LOLER) 1998
- Working at Height Regulations 2005
What is an approved code of practice?
- ACOPs describe preferred or recommended methods that can be used (or standards to be met) to comply with regulations and the duties imposed by the Health and Safety at Work etc Act.
- ACOP is approved by the Health and Safety Executive
Can you tell me about the medical gas package and how this works?
- Medical gas includes Oxygen, Mixed/medical air, surgical area.
- It runs through the building through labelled copper pipes
- There are gas alarms throughout.
- The gas should be stored in a dark room, clearly labelled, at a certain temperature with labelling on the door.
How can you tell if something has been installed to the British Standard?
- By checking the relevant British standard documentation/guidance notes vs the install on site.
- Materials can sometimes have the Kitemark on them
What is a British Standard?
- Publications issued by the British Standard Institution
- Give recommended minimum standards for materials, components, design and construction practices.
What is a Building Regulation?
- Regulations to ensure that new buildings, renovations, conversions etc. are going to be safe, healthy and high performing.
- Regulations include topics such as structural integrity, fire protection, accessibility, energy performance, acoustic performance, protection against falls, electrical and gas safety.
Can you list the Building Regulation Approved Documents?
- A: Structure
- B: Fire Safety
- C: Site preparation and resistance to contaminants and moisture
- D: Toxic substances
- E: Resistance to the passage of sound
- F: Ventilation
- G: Sanitation, hot water safety and water efficiency
- H: Drainage and waste disposal
- J: Heat producing appliances and Fuel storage system
- K: Protection from falling, collision and impact
- L: Conservation of fuel and power
- M: Access to and use of buildings
- N: Glazing - Safety in relation to impact, opening and cleaning
- O: Overheating
- P: Electrical safety
- Q: Security – Dwellings
- R: High speed electronic communications networks
- S: Infrastructure for charging electric vehicles
How can you tell if something has been installed to the Building Regulations?
- By checking the relevant approved document.
Why are UPVC pipes used instead of cast iron water pipes?
- PVC is lightweight, Cost effective, flexible and cleaner.
- Cast Iron could erode, it’s heavy and is brittle.
What is the difference between acoustic insulation and thermal insulation?
- Acoustic insulation is of a higher density to reduce unwanted noise. Usually insulation with a mass loaded vinyl.
- Thermal insulation acts as a barrier to obstruct heat escaping. Usually made from Rockwool
What would you include in a lightning protection scope?
- It would need to conform to BS 62305
- Would include – earth bars, tape, lightning rods, earth pits, air termination.
What part of the building regulations would insulation come under?
- Approved Document L – It controls the insulation values of buildings elements
What is RIBA?
- The Royal Institute of British Architects
- RIBA plan of work organises the process of briefing, designing, constructing and operating.
- Explains outcomes and core tasks required at each stage.
What are the RIBA stages?
- 0 - Strategic definition.
- 1 - Preparation and briefing.
- 2 - Concept design.
- 3 - Spatial coordination.
- 4 - Technical design.
- 5 - Manufacturing and construction.
- 6 - Handover.
- 7 - Use.
What do VM and VE do? - Value management and Value Engineering (1st edition, January 2017)
- Aim to maximise project value given the. time, cost and quality constraints.
What is value management?
Value management usually incorporates a series of workshops, interviews and reviews, through which the project requirements are evaluated against the means of achieving them.
What is value engineering?
- The process of reducing the cost of producing a product without reducing its quality or how effective it is
Can you tell me what you learnt on the NEC 3 course?
- This taught me about the various different options and general key clauses within the contract such as clause 10.1, Clause 16.1
- Main options
- Secondary Options
- Cost Components and
- Contract Data.
What are the various forms of sub-contract commonly used?
- JCT (Joint Contracts Tribunal)
- NEC (New Engineering Contract)
- FIDIC
- Bespoke
Can you tell me about the NEC contract?
- Suitable for any construction base contract between employer and contractor
- No reference to the QS in the contract
- Programme is contract document
- Requirement for parties to give EWNS
What are the advantages of the NEC?
- Contract is based on mutual trust and co-operation
- Focus on Pro-active risk management
- Encourages parties to resolve cost and programme issues up front
- Contract is written in plain English
What are the advantages of the JCT?
- The advantages would depend upon the contract. If we consider a D&B, the advantages would be:
o The contactor holds all the risk
o It is much quicker
o There is cost certainty.
- On an SBC, the advantages would be:
o Great for complex/large projects
o Employer retains design control
o Works can be carried out in sections.
What is a relevant event?
- An event, on or off site which causes delay to the completion date.
o These are variations or instructions
o Strike
o Terrorism
o Suspension by contractor for non-payment
o Force Majeure.
What happens when a relevant event occurs?
- As soon as the contractor notices a delay will occur, contractor must notify the Administrator in writing with clear substantiation with estimate of delay and why etc.
- Contractor administrator must respond within 12 weeks.
- If it has occurred, the contract administrator must assess the delay and issue a new completion date or EOT.
Under a relevant event, is the contractor entitled to loss and expense?
- No, a claim to an extension of time only
- Contractor will need to demonstrate loss and expense.
What is force majeure?
- Something which happens which is out of our control
o War, riot, terrorism acts, contamination, civil war, bad weather etc.
What is a relevant matter?
- A matter which the employer is responsible for.
- Effects the progress of the works
- May entitle the contractor to loss and expense.
What is an example of relevant matter?
- Failure to give the contractor possession of the site
- Delays in receiving instructions
- Disruption caused by work carried out by employer
JCT or NEC?
- Private commercial property developers generally prefer the JCT because they can achieve greater control by transferring risk as far as possible, which helps to meet the expectations of their funders.
- NEC contracts tend to be used by experienced, proactive clients with depth of management resources.
What does FIDIC stand for?
- the International Federation Of Consulting Engineers
- A contract which is recognised internationally (some 97 countries)
- Core suite of contracts include – Design and Build for Electrical and Mechanical Plant
- Short Form, Dredgers contract, Conditions of contract for Construction.
- standard FIDIC contracts will include an in-depth outline of topics such as roles and authority, labour conditions, delays caused by authorities, procedure for dispute settlement
- and resolution, and defect liability as well as liability for errors
NEC vs FIDIC?
- NEC has probably many advantages over FIDIC particularly in clarity, flexibility, explicit project management procedures, partnering and teamwork, risk management, objective measurements of weather and ground conditions risks, and variations
What are the advantages of a bespoke contract?
- Written by legal experts
- Rights and obligations of each party clearly set out
- Parties should be more-so familiar with the provisions of the form
What are the dis-advantages of a bespoke contract?
- Familiarity is decreased
- Expensive to draft
- Poorly drafted could lead to ambiguities
- Clauses or provisions may be untested in court.
What are the secondary options under the NEC?
- W1 & W2 – Dispute Resolution Clauses
- X Clauses
o X1 – Inflation
o X2 – Changes in the Law
o X3 – Multiple Currencies
o X4 – PGC
o X5 – Section completion
o X6 – Bonus for early completion
o X12 – Partnering
o X13 – Performance bond
o X16 – Retention - Options for dealing with legislation
o Y (UK) 2 – HGCRA 1996
o Y (UK) 3 – Rights of Third Parties Act.
What is the law and legislation for contracts in the construction industry?
- Housing Grants, Construction and Regeneration Act HGRA 1996 (amended 2011)
- Scheme for Construction Contracts
What is a PGC?
- A Parent Company Guarantee
- A form of security to protect the client/employer from contractor defaulting.
- Parent company can step in should the original contractor default.
- Useful where small contractor part of a large financially stable group of companies
What is a Bond?
- Protects for the owner against non-payment, lack of performance or company default.
- Is backed up by a third party (insurance)
What are the different types of bond?
- Performance Bond
- Retention Bond
- Off-site materials bond
- Advanced payment bond
- Tender Bond
What is a Performance bond?
o Security provided by contractor to developer
o Insurance company makes payment to developer where contractor has defaulted.
o Used when: Employer wants to protect commercial exposure, recession coming, contractor is new or un-approved.
o Value of a performance bond typically 10% of contract sum.
o Alternative to a performance bond is a PCG.
What is a Retention bond?
o Retention bonds are way of avoiding problems associated with retention recovery.
o Amounts that would otherwise have been held as retention are instead paid, with a bond being provided to secure the amount.
o Only if practical completion is not achieved by the subcontractor or if they prevent a certificate of making good defects from being issued will the retention bond take effect. The contractor is then able to ‘call’ on the retention bond.
What is an off-site materials bond?
o a Bond in respect of Off-Site Materials and/or Goods and is requested by an Employer to cover their exposure should materials not be delivered to site as agreed in the Contract.
What is an Advanced payment bond?
o The Bond will protect the Beneficiary for the full Advanced amount should the Contractor default on the agreement.
What is a tender bond?
o A guarantee (typically a bank guarantee), for a specified price or a specified percentage of the tender price, issued on behalf of a seller to guarantee that the seller will not withdraw his bid from the tendering process before a binding contract is concluded.
What are the 2 ways in which bonds can be drawn down?
o On Demand – Money immediately available without setting out any pre-conditions.
o Conditional – Requires employer to provide evidence that the contractor has not performed and that they have suffered loss.
What is a Parent Company Guarantee?
- A security to protect clients in the event of default by the Contractor. The parent company would step in.
What is a Warranty/Collateral Warranty?
- Contractual agreement which runs alongside another agreement.
- Gives the employer a direct link to any sub-contractors used. The Employer/client can by-pass the Contractor.
- Helps if a Contractor goes insolvent or employment is terminated.
- Alternative to the collateral warranty is the Contract (Rights of Third Parties) Act 1999.
- Parkwood Leisure vs Laing O’Rourke
What are Third Party Rights?
- Contracts (Rights of Third Parties) Act 1999
- Act allows parties to enforce terms of contract that they are not party to.
- Gives parties access to various remedies if contract terms are breached.
What are Defects?
- A defect in workmanship, design or materials results in failure of the building or causes damage to people or property causing financial harm or losses to owner.
- Rectification period is 12 months – most defects will become apparent in this time.
What is a patent defect?
- Defects which can be discovered by reasonable inspection – cracks, broken windows, missing tiles, sagging gutters etc.
What is a latent defect?
- Defects which cannot be discovered by reasonable inspection
- Problems found several years after completion (issues with foundations etc.)
What is retention?
- A percentage of sums certified for payment held by the Contractor/Employer (3 – 5%)
- RICS Guidance on Retention – 1st Edition – 2012.
- Purpose of retention to safeguard against defects that the contractor/subcontractor may fail to fix.
- Alternative to retention is a ‘retention bond’.
When is retention released?
- On PC first half of retention released.
- Second half certified and released upon the expiry of the defect period.
How do you know when a final account has been successful?
- When both parties are happy that a palatable agreement has been met
- Where both parties agree and shake on a number.
What happens after a final account has been reached?
- We have the final account meeting
- I would draft the final account agreement as per discussions.
- This would be sent to the Sub-Contractor, signed and dated.
- We would then sign and date internally and store appropriately.
How do you keep disputes to a minimum?
- Communicate and liaise with Sub-Contractors as soon as a dispute may arise.
- Resolve it early on.
- Have meetings in person so nothing can be mis-construed.
- Refer to RICS’s guidance note on Dispute Resolution.
What insurance documentation is required for sub-contractors?
- Professional Indemnity Insurance
- Public Liability Insurance
- Employers Liability Insurance
- Product Liability
Can you tell me how retention works?
- Typically 3 – 5% held by the Employer or Contractor for defects.
- ½ released on the return of a P/C certificate.
- Final amount released after defect period has passed.
What is clause X16 under the NEC?
Retention Clause.
Can you give me other clauses/optional clauses under the NEC contract?
X1 - Inflation,
X2 – Changes in the Law
X3 – Multiple Currencies
X4 – PGC
Why did you advise that the retention clause be struck through?
- Because the Sub-Contractor is a very long standing, reputable sub-contractor who we have used for years and on several projects have not had defects.
- Their package works were very small and the sub-contract value small
- They are also a small company so need the cash-flow support.
If you have got underperforming Sub-Contractors on site, what route would you advise to take?
- If they are under-performing – under the Form 66, we can give the Sub-Contractor 7 days’ notice to increase their performance or we could potentially take works off of them and charge them any costs associated with taking these works off of them.
- We could have also issued an EWN notifying them of their concerns and this would also be the case under the NEC as there is no specific clause under the NEC.
- What is clause X16 of the NEC3 Contract?
a. The Retention Clause.
- You state you advised the project lead regarding the subcontractor not accepting the retention clause. What was it you advised?
a. I advised that the Sub-Contractor was not keen on having the retention clause applied.
b. I advised that given that they were a reputable sub-contractor that we have used for years without any defects or issues and the fact that their sub-contract works were so small that actually this was very little risk to us and that our relationship.
