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SAP Presenation_Role of Quantity Surveying Dept

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    Presented by : Anthony L. Almeida , Head of Quantity Survey Dept) (BPO)Roshan De Silva ,Project Quantity Surveyor, Dubal Projects- (CTM)

    Role of Quantity Surveying

    Department

    SAP Implementation Project

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    Quantity Survey DepartmentQuantity Survey (Q.S.) Department is part of commercial department without involving estimation,since estimation is a separate department.

    Once the job is awarded, then Q.S. Dept. comes into the picture, as they are the revenue point. Thebudget, signed by Managing Director, is prepared and released by Estimation Department. QSDepartment shares the budget with Accounts department, as the Accounts department interacts withHead, Quantity Survey Dept. for closing of accounts. Controlling of budget is mainly done in Purchase

    Dept.. Q.S. Dept. and Accounts Dept. jointly sits at the end of every month to close accounts, to checkthe revenue generated against the cost incurred. This exercise helps to monitor the progress of theproject, commercially, thus, enabling the Q.S. Dept. to inform the concerned Project Managers, for anycost overruns for their corrective measures.

    Managing DirectorGeneral Manager

    CommercialHead of Quantity

    Survey Dept.

    Project QuantitySurveyors.

    Contract Executives.

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    Role of the Quantity Surveying Dept.

    1. First and foremost, any tender taken up by the Estimation Dept., if it calls fora Tender Bond is forwarded to the Q.S. Dept. to take care, i.e. applying andreceiving the same from the Accounts Dept.. In case the tender is a majorone, the Head, Quantity Survey Dept. prepares a detailed cash flow to ourbankers to obtain the Tender Bond. Once the original Tender Bond is

    received, the same is provided to the Head, Estimation Dept.

    2. Once a contract is awarded, depending on the documents available (LOI /unsigned Contract Document), the same is scrutinized to check the bondrequirement (i.e. Performance Bond, Advance Payment Bond, Retention

    Bond/Warranty Bond, etc.). If any bond is required, the same is applied andthe application is sent to the Accounts Dept. to get the bond from ourbankers. In case the project is a major one and requires facilities from ourbankers, Head, Quantity Survey Dept. prepares a detailed cash flow for ourbankers. Upon receipt of the original bond(s) the same is submitted along

    with a covering letter to our Client.

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    Role of the Quantity Surveying Dept. (Contd..)

    The Contract document is further scrutinized to understand thepayment terms, whether progress / milestone, etc.. Milestonepayment is nothing but once a particular milestone is completed,the revenue may be recognized by way of a Milestone invoice

    raised after the go ahead from the respective Project Managers /instruction from Project Q.S.

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    Role of the Quantity Surveying Dept. (Contd..)

    Payment Terms (Milestone Basis) Payment Terms (Progressive Basis)

    Example

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    Role of the Quantity Surveying Dept. (Contd..)

    The contract document is further scrutinized by individual ProjectQ.S.s of the various projects to prepare the invoicing formats inconsultation with the Head, Quantity Survey Dept. as per clientrequirement. They review the contract through Q.S. point of view

    and see what are the things required, as every Client requirementis different. Q.S. plays a major role in recognizing the revenue,whether it is on initial project (original contract value) or projectrelated variations ( positives / negatives ).

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    Role of the Quantity Surveying Dept. (Contd..)

    By variation, we mean, any change in the original scope by way ofadditions / deletions, design / engineering change, an entirely newitem, etc., is identified by the Q.S. Dept. with the help of Project

    Manager and properly substantiated with suppliers quotations, ourLPOs and suppliers invoices and consolidated and presented to theClient as a Variation Request / Claim.

    What do you mean by a variation

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Variation Request / Claim)Dubal Projects

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Variation Order Issued by the Client)

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    3. Since the format of invoices keeps on changing as per the Client /Customers requirement, it is easy to maintain the same in Microsoft Excel sothat changes can be done as and when required. Depending on theinformation received from various sites, from Project Q.S.s / ProjectManagers, for invoicing, which is end of the month / beginning of thefollowing month, a Progress Payment Application / Invoice is raised andsubmitted to Client.

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    Role of the Quantity Surveying Dept. (Contd..)

    A Progress Payment Application (invoice) is submitted when theinvoicing is to be done at the end of every month based on the actualprogress achieved.

    This gives the Client a clear understanding of the progress achieved,commercially, at any point in time. He can see / pick the order value, thegross invoicing achieved during a particular month, the net payable, theamount already paid / the balance to be paid, etc., e.g. Progress Payment

    Application submitted to DUBAL.

    In the case of some of our overseas Clients, they prefer to have astandalone invoice which gives them the amount to be paid as of thatinvoice. In such cases, we attach the Progress Payment Application as a

    backup for them, to enable them to reconcile the accounts easily, e.g.Invoice submitted to M/s. Sojitz Corporation.

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    Role of the Quantity Surveying Dept. (Contd..)

    Since, majority of our projects are on re-measureable basis, site work

    progress has to be measured based on actual work done, which is recordedthrough IRs (Inspection Requests) / ISRs (Inspection Survey Requests)depending on Clients requirement.

    In addition to site work progress, Materials delivered to site during the

    month for the project are regularized by submitting the MaterialInspection Request by our QA/QC Engineer to Client. Once thesematerials are inspected and approved by Client, the same will be includedby the respective Project Q.S.s in their monthly Progress PaymentApplications to Client.

    There are cases where invoices are raised during the month. Theseinvoices are generally one time standalone invoices.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Invoice)

    Click on the table for a detailed view

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Progress Payment Application)Dubal Projects

    Click on the table for a detailed view

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Re-measurable basis Payment Application)Sorouh

    Click on the table for a detailed view

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Material Inspection Request, Inspection Request)

    Inspection Requests may vary depending on theClients requirement

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    4. Once any invoice is raised, it is entered into various schedules [ Job Card(maintained for individual projects), Statement of Invoicing (for thatparticular month), Statement of Invoicing / Payments (cumulative), etc. ].This Job Card is then circulated to all the concerned Project Managers,Project Q.S.s & Accounts Dept.. The respective Project Q.S.s follow ups with

    the Client for the certification of the submitted invoices. Once the PaymentCertificate is issued by Client, the same is forwarded from the variousProject Q.S.s to the Head, Quantity Survey Dept.. Upon receipt of thePayment Certificate, the same is updated into the Job Card and immediatelycirculated to all the concerned Project Managers, Project Q.S.s & Accounts

    Dept. and payment follow up begins.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Statement of Invoicing / Job Card)

    Click on the table for a detailed view

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Payment Certificate from Client)

    Click on the table for a detailed view

    Formats can be provided upon request.

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    Role of the Quantity Surveying Dept. (Contd..)

    5. At the beginning of the month the List of Payments Received / Expectedduring the month is updated by Head, Quantity Survey Dept. and sent toAccounts Dept.. Collection of funds from our various Clients is also done by

    Q.S. Dept.. Accounts Dept. depends on the Q.S. Dept. for funds.

    6. The Quantity Survey Dept. also maintains a complete schedule of all thebonds (i.e. Tender Bonds, Performance Bonds, Advance Payment Bonds &Retention/Warranty Bonds) issued to our various Clients in order for us to

    call back at the time of expiry.

    7. Subcontractor Bonds issued in our favour are maintained by the Head,Quantity Survey Dept.. Also, all major equipment supplier / subcontractorinvoices along with labour supply invoices are certified by Head, Quantity

    Survey Dept..

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Payment Certificate to Sub Contractor)

    Formats can be provided upon request.

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    8. Budgeting (Revenue / Cost) for the New Year is done by Head, Quantity

    Survey Dept. to establish the turnover, net profit, etc.. This is normally doneby end of November and beginning of December. Once finalized, the

    budget is presented to the Managing Director by mid of December, so as toset the target and preplan for the New Year. This budget is furthermonitored throughout the year by periodic updates / revisions. The updates/ revisions are circulated among the Divisional Managers and ProjectManagers for implementation, so that the set targets are achieved.

    9. Respective Project Q.S.s are expected to settle the Final Account with ProjectManagers full involvement, in consultation with the Head, Quantity SurveyDept.. This procedure generally goes on for several months maybe years asthe same is a very tedious job wherein all additions / deletions, positive /

    negative variations, Extension Of Time (EOT) claim, etc. have to be dealtwith and closed completely. In some cases, Clients insist on seeing the Proofof Payment as well.

    Role of the Quantity Surveying Dept. (Contd..)

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    Role of the Quantity Surveying Dept. (Contd..)

    Example (Extension of Time (EOT Claim))

    Formats can be provided upon request.

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    QS Department Role Summarized

    Bonds (APG/PG etc)

    Variations.

    Invoicing (Prg/MS/SA)

    Sub Contract PC

    Final account / Close-outs

    EOTFinal

    Variations

    Quantity Surveying Dept

    Finance DeptApplicationforBondsReceivingBonds

    PaymentUpdates

    Sub ContractorSubmissionofSCInv.

    IssuanceofSCPC.Payments

    Client / Main Cont.SubmissionofbondsSubmissionofVariations

    ApprovalofVariations(VO)Submission/FollowuponPC&Payment

    ReceiptofPC/Payments

    Submission/FollowuponPC&PaymentReceiptofPC/Payments

    PaymentsEstimation Dept

    LOA/ContractDocumentPostContact

    PreContract.Estimation Dept

    Quantity Survey Dept Finance Dept

    Applying TenderbondRequestreceivedforTenderBond

    Receiving Tenderbond

    OriginalTenderBondProvidedtoEstimationdept

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    End of Presentation.

    Thank You.

    Q & A


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