Financial Institution Auditing

Pre Construction Cost Audit Reports

Financiers can rely on Property & Building Assessments to deliver comprehensive pre-construction reports to include:

  • Review of proposed construction contract, special conditions and proposed security
  • Comment on the level of documentation provided and whether satisfactory to deliver the project
  • Comment on the capability of the Builder and Project Consultants to fulfill the construction contract
  • Comment on the suitability of the construction contract to deliver the project satisfactorily for pre-sale¬† and/or pre-leasing contracts
  • Review of the development program and confirmation the program is achievable
  • Review of the development cashflow forecasts
  • Preparation of independent estimate of construction costs separately measured, to verify the adequacy of the total project budget
  • Review of allowances for other costs such as land acquisition, headworks, fees and charges, professional fees, finance costs and interest charges and contingency allowances
  • Comment upon any specific site conditions which might impact upon project costs
  • Summary of status of authority approvals including development consent, planning approval and building licence and review of conditions attached to approvals
  • Comment on degree of completion of design documentation
  • Prepare a schedule of Project Consultants engaged and provide copies of professional indemnity insurance
  • Review of project insurances
  • Highlight any specific project risk!

Progress Claim Assessments

Progress Claim Reports are generally prepared addressing the following:

  • Assessment of the progress claim submitted by the Contractor
  • Certification of the value of work complete including fixed materials on-site
  • Review and update the forecast development and construction costs
  • Certification of the cost to complete
  • Comparison between actual expenditure to date and anticipated cashflow
  • Comment upon the progress of the works and provide an independent assessment of the likely project completion date
  • Summary of status of variations and claims
  • Verify that claims from Sub-Contractors and Suppliers have been paid in accordance with their contracts
  • Advise on the ongoing status of approvals and permits
  • Obtain certification from Design Consultants that the works are proceeding in accordance with the relevant documentation and approvals
  • Confirm status of project insurances.
  • Advise on issues of risk
  • Attend additional meetings and site inspections as necessary for the above.

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Australian Institute of Quantity Surveyors