Using post-tender estimates

Post-tender estimates should be reported in a similar way to cost reports. The executive summary and introduction should state what is included within this particular estimate and what the allocated budget is.

The budget should be reconciled with the extent of works covered by the estimate. This may include transferring money in and/or out of the budget total. The budget starting point should be the tender return. The estimate should be reconciled against the agreed budget highlighting areas of unagreed scope growth, and client change.

When reporting on the costs particularly with respect to the overall building costs that the costs are related to the building area. When reporting against floor areas it is necessary to define under which code of measurement the areas have been measured (see RICS property measurement (professional statement, 2015) and International Property Measurement Standard (IPMS) for Office Buildings.

If the post-tender estimate is over budget it may be necessary to embark upon a value engineering process.

Areas of work which are covered by allowances should be identified, indicating the extent of work that needs to be detailed. This should relate to new variations which have not been detailed and any provisional sums which are contained within the tender. The summary should highlight the extent of these and the potential financial risks associated with elements of undefined works.

The information used in producing the post-tender estimate should be scheduled with the revision numbers of each of the drawings and documents shown.

Preparation of a post-tender estimate - check list

There are a number of fundamental things that need to be established before starting a post-tender estimate:

• Tender return including the priced tender documents and all associated amendments and qualifications (it will be necessary to determine shortfalls or changes from the tender).
• Full set of drawings and specifications which cover the extent of works. These should be completed drawings and specification documents without ambiguity.
• Drawings or sketches indicating the extent of any changes to the tendered design, these should be fully detailed or as a minimum fully annotated to truly represent the revise works (client/tenant/third party variations).
• Any further information from additional site investigations.
• Are there any changes to the programme as a result of the changes? If there is a shortened programme then this will dictate how the work is carried out and whether special measures need to be employed.
• Any new restrictions placed on the works such as phasing, occupied portions of the site or limited working hours. These restrictions would need to be factored in to the post-tender estimate.