A few weeks ago Brian, PEP Solutions’ Senior Quantity Surveyor, kickstarted a site inspection for a new apartment development in sunny Wynnum. The new development is being built by Clear Construction QLD. Alongside site manager Graham Burrell, Brian conducted this inspection to better prepare the monthly progress report for the National Australia Bank.
To learn a little more about monthly progress reports, one of PEP Solutions’ key services, we have prepared some information below.
PURPOSE OF MONTHLY PROGRESS REPORTS
With Financier Project Auditing, the Quantity Surveyor is responsible to their Bank Client to provide advice in respect of management of the Loan Facility between the Borrower and the Bank. The Financier Project Auditing process involves the preparation of an initial report and monthly progress reports during construction.
WHAT IS INVOLVED IN A MONTHLY PROGRESS REPORT?
Progress Reports are prepared monthly once construction is underway and contain the following:
A certificate, certifying the value of work completed in the period since the last certificate and the Cost to complete the project, including the Progress Payment to be made under the Building Contract and the GST payable. Claims for payment in respect to off-site materials or materials not fixed-in will not be allowable unless prior approval has been obtained from the Bank. Where certification differs to the Progress Claim a summary of reconciliation is to be provided to justify the differences including reasons.
Cost to Complete Assessment
The Bank only assess requests for funding based on cost to complete in accordance with the Quantity Surveyor’s Progress Certificate. The cost to complete assessment must make account of all contract variations, potential variations and other cost overruns.
The Forecast Development Cost is reported against the initial Development Budget in the form of a cost summary. The summary details forecast against budget inclusive of construction costs and other direct costs to be borne by the Borrower in completing the project. Significant variances are highlighted. The status of variations is noted as approved, pending and forecast, and provisional and contingency sums are monitored.
Payments by the Contractor
Verify that all claims from sub-contractors and suppliers have been paid in accordance with their contracts. This is done by the Contractor providing a Statutory Declaration with each Progress Claim in respect of payments.
Program and Progress
Comment upon the progress of the design documentation and construction and any other matter which may affect the completion date. Provide an independent assessment of the projected completion date.
Advise on the status of Authority Approvals and any outstanding approvals, confirming all necessary Authority Approvals remain in full force and effect in respect to the works for which the drawdown relates
Obtain from the main Project Consultants at each Progress Certificate, certification confirming that the works to date have completed in accordance with contract documentation and Authority Approvals. These certifications are a prerequisite to funding by the Bank. Advise of defects and the recommendations made to address these defects. Each Project Consultant is to provide a certification as to Practical Completion in respect of the works they are responsible for.
Confirm all Project Insurances are at all times operative. Should insurances expire obtain evidence of updated expiry dates / policies from the insured parties and include within the relevant progress report.
Can PEP Solutions Help with your development?
Contact us today on 1300 26 36 76 or email email@example.com.