A Study on the Differences between Pre-tender Cost Estimate and Final Contract Sum

Puah, Kian Yik (2018) A Study on the Differences between Pre-tender Cost Estimate and Final Contract Sum. Final Year Project (Bachelor), Tunku Abdul Rahman University College.

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Abstract

Several statements demonstrate the inaccuracy of estimation conducted by the CQS to occur in Malaysia. Hence, the aim of this study is to examine the accuracy of pre-tender cost estimate assessed by the CQS in Malaysia. Qualitative research is adopted in this study where primary data is collected through person-to-person interview. Whereas, secondary data is collected from journals, articles, newspaper, books and conference papers. Opinions from ten (10) CQS who are equipped with experience from the preparation of pre-tender cost estimate until final contract sum are collected as data to be analysed. One of the respondents has shared experiences on two (2) high-rise residential projects regarding this research. Hence, the data collected is based on eleven (11) high-rise residential project in South-West of Malaysia. Accuracy of pre-tender cost estimate is analysed by using formulae of measurement of bias (error), mean of estimate bias and standard deviation. Moreover, coding system is use to analyse factors affecting the differences between pre-tender cost estimate and final contract sum as well as approaches can be taken to minimize the differences between pre-tender cost estimate and final contract sum. The data analysed illustrate most of the pre-tender cost estimate prepared by the CQS are bias. There are new findings found in this study regarding factors affecting the pre-tender cost estimate and final contract sum as well as approaches can be taken to minimize the accuracy of pre-tender cost estimate. A model has been presented where factors affecting pre-tender cost estimate and final contract sum are categorised in pre-contract and post-contract stages. The findings deduce that the parties involved in a project have their own roles to minimize the differences between pre-tender cost estimate and final contract sum. These findings led to the achievement of objectives of this research. This eventually accomplished the aim that was initially established.