SPP OThers

AR 432A: PROFESSIONAL PRACTICE 3
Midterm Handouts
STANDARD OF PROFESSIONAL PRACTICE (SPP) ON

COMPREHENSIVE ARCHITECTURAL SERVICES
(Part of the IRR of R.A. No. 9266)
SPP Document 206
(Replacing the 1979 UAP Doc. 206)
1. INTRODUCTION
1.1 The concept of Comprehensive Architectural Services crystallized through the years in response to the demands of
emerging complex building projects. The transition of the architectural profession from providing “basic” and
“additional” services to that of a comprehensive nature is due to the realization that continuity of services related
to design and construction is necessary for the execution of a completely viable project.
1.2 Comprehensive Architectural Services refers to the range of professional services that covers Pre-design Services,
Regular Design Services, Specialized Architectural Services, Construction Services and Post-Construction Services.
1.1 In this extended dimension, the Architect is the prime professional. He functions as creator, author, and
coordinator of the building design which becomes the basis for the construction of a project. In order for him to
be able to properly assist and serve his Client, the Architect has to be knowledgeable in other fields in addition to
building design.
1.2 The Architect is not expected to perform all the services. Rather, he is to act as the agent of the Client in procuring
and coordinating the necessary services required by a project.
2. SCOPE OF COMPREHENSIVE ARCHITECTURAL SERVICES
2.1 Pre-Design Services (SPP Document 201)
2.1.1 Consultation
2.1.2 Pre-Feasibility Studies
2.1.3 Feasibility Studies
2.1.4 Site Selection and Analysis
2.1.5 Site Utilization and Land-Use Studies
2.1.6 Architectural Research
2.1.7 Architectural Programming
2.1.8 Space Planning
2.1.9 Space Management Studies
2.1.10 Value Management
2.1.11 Design Brief Preparation
2.1.12 Promotional Services
2.2 Regular Design Services (SPP Document 202)
2.2.1 Project Definition Phase
2.2.2 Schematic Design Phase
2.2.3 Design Development Phase
2.2.4 Contract Documents Phase
2.2.5 Bidding or Negotiation Phase
2.2.6 Construction Phase
2.3 Specialized Architectural Services (SPP Document 203)
2.3.1 Architectural Interiors (AI)
2.3.2 Acoustic Design
2.3.3 Architectural Lighting Layout and Design
2.3.4 Site Development Planning (SDP)
2.3.5 Site and Physical Planning Services (including Master Development Planning, Subdivision Planning and
Urban Design)
2.3.6 Comprehensive Development Planning (CDP)
2.3.7 Historic and Cultural Heritage Conservation and Planning
2.3.8 Security Evaluation and Planning
2010 Standards of Professional Practice (SPP) Approved 27 July 2010 as the Supplemental IRR of R.A. No. 9266 (The Architecture Act of 2004) 1 of 35
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2.3.9 Building Systems Design

2.3.10 Facilities Maintenance Support
2.3.11 Building Testing and Commissioning
2.3.12 Building Environmental Certification
2.3.13 Forensic Architecture
2.3.14 Building Appraisal
2.3.15 Preliminary Services
2.3.16 Contract Documentation and Review
2.3.17 Post-Design Services (including Construction Management Services)
2.3.18 Dispute Avoidance and Resolution
2.3.19 Architectural Research Methods
2.3.20 Special Building/ Facility Planning and Design
2.3.21 Building Components
2.3.22 Management of Architectural Practices
2.4 Construction Services
2.4.1 Fulltime Supervision Services (SPP Document 204-A)
2.4.2 Construction Management Services (SPP Document 204-B)
2.5 Post-Construction Services (SPP Document 205)
2.5.1 Building and Facilities Administration
2.5.2 Post-Construction Evaluation
3. PROJECT MANAGEMENT (PM)
3.1 By his education and training, the Architect may perform any or all of the services as stipulated under Section 2
above. However, when the Owner hires an Architect or a firm to coordinate the whole range of Comprehensive
Architectural Services (CAS), this constitutes Project Management (PM).
3.2 Project Management (PM) involves management activities over and above the normal architectural and
engineering (A&E) services carried out during the pre-design, design and construction phase. The over-all objective
is to have control over time, cost and quality relative to the construction of a project.
3.3 The presence of a PM does not relieve the designers and contractors of their respective normal duties and
responsibilities in the design and construction of the project. The PM complements the functions of the Architects,
Engineers and Contractors in meeting the broad and complex requirements of projects.
4. THE PROJECT MANAGER (PM)
4.1 The Project Manager (PM, whether individual or firm) operates as a member of an Owner-Architect-Engineer-
Contractor Team. In the Team Approach, each member of the team will have precedence in his own field of
operations or expertise. In accordance with this principle:
4.1.1 The Architect and the Specialist Consultants (SCs) will have prime responsibility for the plan/design of the
project.
4.1.2 The Engineers will be responsible for their respective engineering plans.
4.1.3 The Contractor shall be responsible for his men and equipment and the delivery of the project.
4.1.4 The Owner makes decisions on the project and assures that funds are available to complete the project.
4.1.5 The Project Manager (PM)’s primary responsibility is the exercise of overall cost control. He will plan,
program and monitor the various activities, and will act as an adviser on material costs and construction
methods.
4.2 Scope of Services
4.2.1 Pre-Construction Phase
As early as during the design development phase, perhaps even concurrently with the Architect’s
commission, the Project Manager (PM) should conduct regular consultations with the Owner and with
the Architects and Engineers (for A&E services) on all aspects of planning for the project.
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If the Project Manager (PM) also serves as the Construction Manager (CM) to oversee time, cost and
quality control during the construction of the project, he shall provide the services detailed under SPP
Documents 204-A and/or 204-B.
5. MANNER OF PROVIDING SERVICES
5.1 Normally, the Architect enters into a contract with the Owner to perform comprehensive architectural services. By
the very nature of the services, he assumes the dual role of the Project Manager (PM) and the Construction
Manager (CM), or effectively the overall coordinator whose functions are outlined under this SPP.
5.2 To perform the variety of services indicated under the Comprehensive Architectural Services, the Architect must
make full use of his own capability as well as of services offered by other professionals. He may expand his staff by
hiring the experts needed, or he may form a team consisting of professionals such as but not limited to:
5.2.1 Architects
5.2.2 Engineers
5.2.3 Market Analysts
5.2.4 Accountants
5.2.5 General Contractors
5.2.6 Real Estate Consultants
5.2.7 Sociologists
5.2.8 Planners
5.2.9 Bankers
5.2.10 Lawyers
5.3 If a Project Manager (PM) is hired by the Owner, it may be the responsibility of the PM to either hire the
Construction Manager (CM) to be paid either by him or directly by the Owner on salary, or on the basis of
percentage of construction cost or to serve as the CM himself. In like manner, the Fulltime Supervisor can either
be a staff member of the PM or hired directly by the Owner.
6. METHOD OF COMPENSATION
6.1 The Project Manager is compensated on a percentage basis, as shall be described in the Architect’s Guidelines.
6.2 If the Architect as Project Manager (PM) performs regular design services for the same project, he shall be
compensated separately for these services as stipulated in SPP Document 202.
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DESIGN-BUILD SERVICES
SPP Document 207
1. INTRODUCTION
1.1 In any building project, there is need to balance the elements of time, quality and cost, which, in many cases, can
best be achieved by the Architect performing Design-Build Services.
1.2 The building industry and the architectural profession have devised several methods of project delivery with the
ultimate goal of handling projects in the shortest possible time, at the lowest possible cost and at an acceptable
quality and performance.
1.3 An Architect with his education, training and expertise qualifies him to take a direct role in the project, from
conceptualization to implementation.
1.4 Design-Build Services simplifies and expedites the process of project delivery while providing creative cost-
effective solutions.
1.5 The Architect renders professional services in the implementation of his design. In Design-Build Services, he
assumes the professional responsibility and civil liability for both the design and the construction of the project.
2. SCOPE OF DESIGN-BUILD SERVICES
2.1 Design-Build Services by Administration
The scope of Design-Build Services by Administration includes the Architect’s Regular Design Services (reference
SPP Document 202) namely:
2.1.1 Project Definition Phase
2.1.2 Schematic Design Phase
2.1.3 Design Development Phase
2.1.4 Contract Document Phase
When the various phases of design services are completed, the Construction Phase goes beyond periodic
inspection and assessment to include the following:
a. Preparation of schedule of work, program and estimates of materials, labor, transportation,
equipment and services as reference for the construction.
b. Organization and hiring of construction personnel, designation of duties and remunerations
c. Negotiation and entering into contract with piecework contractors and evaluation of work
accomplishments
d. Procurement of materials, plants and equipment, licenses and permits
e. Authorizing and undertaking payments of accounts
f. Keeping records and books of accounts
g. Negotiation with Government and private agencies having jurisdiction over the project, and
h. Management of all other business transactions related to the project construction / implementation.
2.2 Design-Build Services with Guaranteed Maximum Project Construction Cost

2.2.1 This method is essentially the same as Design-Build Services by Administration except that the Owner/
Client are provided a guaranteed maximum project construction cost for the construction of the project.
2.2.2 The Owner/ Client is given an estimate of the project, and upon completion, if there is realized savings
from the estimated project construction cost; it is divided equally between the Owner/ Client and the
Architect.
2.2.3 The project construction cost is guaranteed by the Architect not to exceed Ten Percent (10%) of the
estimated project construction cost. Should the actual cost exceed the estimated project construction
cost plus Ten Percent (10%), the Architect shall be liable for the excess amount but only up to the amount
of his administration Fee.
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2.2.4 Should there be additional expenditures beyond the guaranteed maximum project construction cost
which are due to legitimate change/variation orders (CVOs), extra work orders (EWOs), substantial
escalation of prices of the costs of materials or labor as evidenced by data certified by a nationally
recognized agency such as the National Economic Development Authority (NEDA), or to other causes not
attributable to the fault of the Architect, the additional costs shall be borne by the Owner/ Client.
3. MANNER OF PROVIDING SERVICES
3.1 The Architect may be involved in construction, including that of his own design, by adopting an arrangement
different from the general way of bidding out projects to constructors, or from the different modes of Design-
Build Services (DBS). Such an arrangement may take the form of any of the following:
3.1.1 The Architect is part of or a member of the entity constructing his design. He works in tandem with or has
authorized an entity to construct his design.
3.1.2 The Architect is himself a State-licensed contractor implementing his design (or that of others).
3.2 In adopting any of the above arrangements, or any acceptable variation thereof, the Architect must strictly adhere
to the following: :
3.2.1 The Architect must retain his separate / distinct professional identity, prerogatives and integrity as an
Architect, and is therefore subject to the standards and tenets of the SPP, particularly Document 200,
otherwise known as the Code of Ethical Conduct and SPP Document 202.
3.2.2 Whatever mode the Architect adopts in being involved in construction, he must strictly adhere to the
tenets of the Architects Credo with the pledge that he “shall disclose whenever required, any business
investment or venture that may tend to create a conflict of interest, and ensure that such conflict neither
compromises the legitimate interest of the Client nor interfere with his duty to render impartial
judgment.”
4. METHOD OF COMPENSATION
4.1 The manner of payment to the Architect follows the progress of construction. All costs for labor and materials are
paid directly by the Client. The Architect does not advance any money for payment of expenditures connected
with the work. Generally, a revolving fund is given to the Architect beforehand and is accounted for and subject to
periodic auditing by the Client.
4.2 Cost of all permits, licenses and other incidentals to the work are paid by the Owner/ Client.
4.3 The Architect may appoint, subject to the Owner/ Client’s approval, a construction superintendent, purchasing
agent, timekeeper and property clerk aside from the usual labor personnel required. Salaries of such persons are
paid by the Owner/ Client and not deductible from the Architect’s Fee under this SPP.
4.4 The method of compensation may be modified by using the relevant alternatives detailed in SPP Doc. 202.
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ARCHITECTURAL DESIGN COMPETITION (ADC)
SPP Document 208
(Replacing the UAP Doc. 209)
1. INTRODUCTION
The purpose of this SPP for Architectural Design Competition (ADC) is to state the principles upon which competitions are
based and by which Promoters/ Owners should be guided in organizing ADCs. It has been drawn up in the interest of
Project Proponents/ Owners and Competitors.
2. DEFINITIONS
2.1 Owner - The person or organization that undertakes or promotes an ADC with the primary objective of obtaining
excellence in design for a project or for a development concept. The Owner issues the invitation to Architects to
submit plans/designs in accordance with a program and finances the ADC.
2.2 Jury - The people appointed by the Owner to assess the entries to the competition. The members of the Jury are
called Jurors. It consists of a majority of registered and licensed architects (RLAs, hereinafter referred to as
“Architect/s”) assisted by a lay Juror to represent and voice the intention of the Owner. They are nominated by the
Owner and approved by the integrated and accredited professional organization of architects (IAPOA).
2.3 Professional Advisor – An Architect nominated by the Owner and approved by IAPoA to organize the ADC on behalf
of the Owner.
2.4 Technical Advisors – Specialist personnel who may be consulted by the Jurors during the conduct of the ADC to
permit them to obtain all necessary relevant information.
2.5 Competition Secretariat – The body formed by the Owner and approved by the Professional Advisor, to assist the
Professional Advisor and the Jury in the administrative conduct of the ADC
2.6 Classification of Architectural Design Competitions (ADCs)
2.6.1 ADCs shall be classified as follows:
a. Project ADCs for actual Projects proposed for implementation.
b. Ideas Competition or competition of ideas set as a design and planning exercise to elucidate a
problem.
2.6.2 Project ADCs may be conducted in a single stage or two (2)-stage manner. It may either be open or limited
by invitation.
2.6.3 Project ADCs shall be further classified according to degree of complexity based on project classification
i.e. under SPP Document 202.
2.7 Conditions - The full conditions include the program, instructions on submission of entries, site plans, entry forms
and official envelopes and labels. These are drawn up by the Professional Advisor.
2.8 SPP on ADC - refers to the Philippine Standard of Professional Practice (SPP) on Architectural Design Competitions
(ADC).
2.9 IAPOA ADC Committee - appointed by the IAPOA National President to oversee all architectural design
competitions (ADCs) referred to the IAPOA.
3. IAPOA APPROVAL
3.1 Before any official announcement is made by the Owner, a written approval of the draft Conditions, including the
timetable, The ADC registration fee (when required) and membership of the Jury shall have been received in
writing by the Owner from the IAPOA through the ADC Committee.
3.2 Notice of a National Architectural Design Competition (ADC) shall be issued by the Owner and/or the IAPOA ADC
Committee Secretariat with a request for publication in technical journals or through other media at their disposal,
simultaneously if possible to enable those interested to apply for the competition. Such an announcement shall
state where and how the ADC documents may be obtained and that the ADC conditions have received the
requisite IAPOA approval.
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4. DRAWING UP THE ADC CONDITIONS

4.1 It is essential that the ANONYMITY of competitors should be maintained until the final judgment of the
competition. In the interest of the competition system, rigorous measures should be taken to ensure that this
principle is adhered to.
4.2 The ADC conditions, including the program of requirements of a National ADC shall be identical for all competitors.
4.3 The conditions for National ADC, whether single or two (2)-stage, upon or limited shall state clearly:
4.3.1 the purpose of the ADC and the intentions of the Owner.
4.3.2 the nature of the problem to be solved.
4.3.3 all the requirements to be met by Competitors.
4.4 A clear distinction shall be made between the mandatory requirements of the Conditions and those which permit
the competitor freedom of interpretation, which should be as wide as possible. All competition entries shall be
submitted in a manner to be prescribed in the Conditions.
4.5 The information supplied to competitors (social, economic, technical, geographical and topographical, etc.) must
be specific and not open to misinterpretation. Supplementary information and instructions approved by the Jury
may be issued by the Owner to all Competitors selected to proceed to the second (2nd) stage of a two (2)-stage
competition.
4.6 The Conditions shall state the number, nature, scale and dimensions of the documents, plans or models required
and the terms of acceptance of such documents or models. Where an estimate of cost is required this must be
presented in standard form as set out in the Condition.
5. PROFESSIONAL ADVISOR
5.1 A Professional Advisor should be appointed and paid by the Owner and approved by the IAPOA National Board of
Directors (NBD) thru its ADC Committee. His role is the supervision of the conduct of the ADC and the preparation
of the Conditions. His function includes insuring that the ADC timetable is adhered to, supervising the receipt of
Competitor’s questions, the dispatch of reply to all Competitors and the receipt of competition entries, and
safeguarding the anonymity of Competitors at all times. He will assist the Jury and will be present during its
deliberations but he will have no vote. His responsibilities will be limited to the organization and the conduct of
the competition.
6. THE JURY
6.1 The Jury shall be set up before the official announcement of the competition. Their names and those of the
reserve members of the Jury shall be stated in the Conditions.
6.2 The Jurors are appointed by the Owner and approved by the IAPOA, which shall assist the Owner in the selection
of the Jury members.
6.3 The Jury shall be composed of the smallest reasonable number of persons and in any event should be an odd
number and should not exceed seven (7). The majority of them shall be Architects i.e. 4 out of 7.
6.4 To ensure correct conduct of the competition, at least one of the Architect-Jurors shall represent the IAPOA.
6.5 There should not be more than one (1) representative of the Owner included in the Jury.
6.6 It is essential that all Jurors be present at all meetings of the Jury.
6.7 Each Juror shall see the Conditions before they are made available to Competitors.
6.8 The decisions of the Jury shall be taken by a majority vote, with a separate vote on each competition plan/design
submitted. The list of ADC awards including the Jury’s report to the Owner shall be signed by all Jurors before the
Jury is dissolved and one copy of this document shall be sent to the IAPOA.
6.9 In a two (2)-stage competition, the same Jury should judge both stages of the competition. In no case may a
competition that has received IAPOA approval as a single-stage competition proceed to a second (2nd) stage
except with IAPOA approval of the Conditions and the arrangements for payment of honoraria to the Competitors
involved, over and above the prize money provided for in the original ADC. In the event of a secondary
competition taking place, the Jury appointed for the original competition must be reappointed by the Owner.
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6.10 Any drawings, photographs, models or other documents not required under the regulations shall be excluded by
the Jury before it examines a Competitor's entry.
6.11 The Jury shall disqualify any design which does not conform to the mandatory requirements, instructions or
Conditions for the ADC.
6.12 The Jury must make awards. The awards shall be final and made public by a date agreed on with the IAPOA and
stated in the competitions. The Jury, when distributing the awards, shall make full use of the amount set aside for
prizes in the ADC Conditions.
6.13 The fees and travel and subsistence expenses of the Jury members shall be paid by the Owner.
7. PERSONS NOT ELIGIBLE FOR ENTRY TO THE ADC
7.1 No member of the Jury will be allowed to take part in the competition, either directly or indirectly, nor be
commissioned with work connected with the prize-winning design either directly or indirectly.
7.2 No member of the promoting body nor any associate or employee, or any person concerned with the preparation
or organization of the ADC will be eligible to compete or assist a Competitor.
8. PRIZES, HONORARIA AND MENTIONS
8.1 The Conditions must state the amount and number of prizes. The prizes awarded must be related to the size and
complexity of the project, the amount of work involved and the expense incurred by Competitors.
8.2 It is important for the Owner to allot adequate prize money to compensate all the Competitors for their work. For
Ideas Competition only, it may be the sole remuneration received by the first (1st) prize winner.
8.3 The Owner undertakes to accept the decisions of the Jury and to pay the prizes allotted within one (1) month of
the official announcement of the ADC results.
8.4 Each participant in a limited ADC by invitation shall receive an honorarium in addition to the prizes awarded.
8.5 In two (2)-stage competitions, a reasonable honorarium shall be paid to each of the Competitors selected to take
part in the second (2nd) stage. This sum, which is intended to reimburse them for the additional work carried out
in the second (2nd) stage, shall be stated in the Conditions and shall be in addition to the prizes awarded.
8.6 The Conditions shall state the use to which the Owner will put the winning plan/design scheme/s. ADC-generated
plans/designs may not be used or altered in any way except by agreement with the author. The Owner or his
agents are not free to pick out portions of the entries to compose another plan/ design due to applicable
ownership and copyright provisions under Secs. 20 (4) and 33 of R.A. No. 9266 (The Architecture Act of 2004) and
of R.A. No. 8293 (Intellectual property Code of the Philippines) and their respective IRRs.
8.7 In Project ADCs, the award of first prize to a plan/design places the Owner under an obligation to entrust the
Author of the plan/design with the commission for the Project. If the winning Competitor is unable to satisfy the
Jury of his ability to carry out the plan/ design work, the Jury may require the winner to collaborate with another
Architect of the winning Competitor’s choice, duly approved by the Jury and Owner.
8.8 In Project ADCs, provisions shall be made in the ADC Conditions for the first prize winner to receive compensation
of a further sum equal to the amount of the first prize, if no contract has been signed within twelve (12) months of
the announcement of the Jury’s award. In so compensating the first prize winner, the Owner does not acquire the
right to carry out the project except with the collaboration of its Author.
8.9 In an Ideas Competition, if the Owner decides to make use of all or part of the winning scheme, he should do so
with the collaboration of the Author. The terms of collaboration must be acceptable to the latter.
9. COPYRIGHT AND RIGHT OF OWNERSHIP
9.1 The Author of any plan/design shall retain the copyright of his work; no alterations may be made without his
written consent.
9.2 The design awarded first prize can only be used by the Owner upon his commissioning the Author to carry out the
plan/design preparation for the project. No other plan/design may be used wholly or in part by the Owner except
by agreement with the Author concerned.
9.3 As a general rule, the Owner’s right to use the ADC-generated plan/design covers one (1) execution only. However,
the Conditions may provide for repetitive work and specify the terms thereof
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9.4 In all cases, unless otherwise stated in the Conditions, the Author of any design shall retain the sole right of
reproduction by virtue of sole copyright under Secs. 20 (4) and 33 of R.A. No. 9266 (The Architecture Act of 2004)
and its IRR.
10. REGISTRATION OF COMPETITORS
10.1 As soon as they have received details of the architectural design competition (ADC), all Competitors shall register
with the Owner. Registration implies acceptance of the Conditions of the ADC.
10.2 The Owner shall issue to all Competitors all the necessary documentation for preparing their plans/designs. Where
the furnishing of such documentation is conditional on payment of a deposit, unless otherwise stated, such a
deposit shall be returned to Competitors who submit a bona fide plan/ design.
10.3 The names of those Competitors selected to proceed to the second (2nd) stage of a two (2)-stage competition shall
be made public only under exceptional conditions to be agreed on by the Jury before the launching of the ADC.
11. INSURANCE
11.1 The Owner shall insure the Competitors’ plans/ designs from the time when he assumes responsibility for them
and for the duration of his responsibility. The amount of such insurance shall be stated in the Conditions.
12. EXHIBITIONS AND ENTRIES
12.1 All designs, including those disqualified by the Jury, shall be exhibited, as a general rule, for at least two (2) weeks,
together with a copy of the signed report of the Jury. The exhibition shall be open to the public free of charge.
12.2 The Owner shall notify in a timely manner, all registered Competitors of the date and place of the public exhibition
and the results of the ADC, and send them a copy of the Jury's report. He shall similarly inform the IAPOA.
Photographs of the prize- winning designs shall be sent to the IAPOA with a view to possible publication.
13. RETURN OF PROJECTS
13.1 All drawings and plans, other than those which have received prizes or have been purchased and are retained by
the Owner, shall be destroyed at the end of the public exhibition, unless provisions are made to the contrary in the
Conditions for the ADC. Where models are required, these will be returned to the Author/s at the expense of the
Owner within a month of the close of the public exhibition.
14. ALTERNATIVE DISPUTE RESOLUTION (ADR) OR LITIGATION
14.1 Since no regulations, however well drawn up, can preclude the possibility of dispute, provisions for conciliation,
mediation and arbitration i.e. ADR modes under R.A. No. 9285, must be included in the ADC Conditions and must
precede any form of litigation.
14.2 The Jury members are the sole arbiters at all stages, up to the final prize-giving.
14.3 In the event of a dispute, not related to the adjudication process or awarding of the prizes, the matter shall be
settled by an arbitration process approved by the IAPOA, and without initial recourse to any form of litigation.
14.4 The expenses resulting from any conciliation, mediation or arbitration, procedure shall be shared by the two (2)
interested parties to the ADR proceeding.
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PROFESSIONAL ARCHITECTURAL CONSULTING SERVICES (PACS)
SPP Document 209
1. FOREWORD
1.1 On March 20, 1980, then President Ferdinand E. Marcos, recognizing the role of the members of accredited
professional organizations (APOs) in nation building and in the pursuit of national goals, issued Letter of
Instruction (LoI) No. 1000 which directs all government agencies and any of its instrumentalities to give priority to
members of the APOs in the hiring of its employees and in the engagement of professional services. This amply
demonstrated the President’s confidence in the capabilities of Filipino professionals i.e. registered and licensed
professionals (RLPs)
1.2 Consequent to this, the Philippine Federation of Professional Associations (PFPA), the umbrella organization of all
professional associations accredited by the Professional Regulation Commission (PRC, hereinafter the
“Commission”), and the Philippine Technological Council (PTC), whose membership consisted of fourteen (14)
accredited technological APOs at that time, initiated the preparation of a document entitled “Standard Guidelines
on Consultancy/Consulting Services”.
1.3 The said document contained a comprehensive coverage of provisions in consonance with national policies and
compatible with norms of accepted professional practices, was seen as a much needed vehicle by which the
Filipino professionals can accelerate their contribution to national development.
1.4 Three decades hence, it has become urgent to re-visit this document in light of the influx of foreign consultants
(FCs) and the proliferation of entities projecting themselves as “consultants” even without the adequate skills,
training, and experience required for rendering competent services. This necessity does not spring only from
narrow professional needs, but more significantly it underscores the need for utilizing qualified Filipino
professionals in the comprehensive development of our country.
1.5 Considering the foregoing, this amended version of the 1981 Standard Guidelines on Consulting Services, based on
the document jointly drafted by PTC and Council for the Built and Natural Environments (CBNE) in accordance with
their Joint Resolution No. 2009-01 dated December 11, 2009, embodies relevant provisions of professional
regulatory laws (PRLs) governing the various APOs, national policies, principles and
rules/regulations/guidelines/manuals of procedure (MoP) governing State-regulated professional practices, as
well as the basic terms and conditions for the engagement of Professional Consultants, such as Consulting
Architects defined under R.A. No. 9266 (The Architecture Act of 2004) and its 2004 implementing rules and
regulations (IRR).
1.6 All national and local government agencies and instrumentalities, government-owned or controlled corporations
(GOCCs) and institutions, as well as those in the private sector and other civil society organizations, including the
international community, are all encouraged to adopt these “Philippine Standard of Professional Practice (SPP) for
Professional Architectural Consulting Services (PACS)” in the selection, commissioning and engagement of
Professional Consulting Architects (PCAs) and in the conceptualization, development, implementation, monitoring
and evaluation of projects that lend and/or lead to the overall national, regional and local development.
2. RATIONALE
2.1 The Government of the Republic of the Philippines, through its various departments, agencies, instrumentalities,
institutions and entities, as well as the private sector and civil society organizations and representatives of the
international community (with projects on Philippine soil), regularly select, commission or engage the services of
professional consultants to achieve maximum efficiency, economy and expediency in the preparation of
program/project concepts, pre-feasibility and feasibility studies, project evaluations, design and plan preparation,
management and other related activities.
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2.2 Moreover, one important strategy for strengthening national capability in the various fields of consulting services
is the full utilization of local expertise, which in turn generates conditions for increased nationally-evolved
scientific and technological knowledge
2.3 In recognition of the urgent need to set the general guidelines on professional consultancy/ consulting services in
the country, to enhance the participation of Filipino professionals in national development and to protect their
rights in accordance with existing laws, policies, rules and regulations, the CBNE and the PTC spearheaded the
formulation of standard guidelines for the practice of professional consulting services for State-regulated
professions represented by the said organizations.
2.4 The full utilization of the services of Filipino Professional Consultants (FPCs) can minimize the importation of
foreign expertise which entails considerable expenditure of hard-earned foreign exchange. Such importation also
erodes the essence of maintaining an educational system geared towards the expansion of the country’s
professional capability. For this reason, the displacement of FPCs by foreign consultants is irrational.
2.5 The inflow of foreign consultants, specifically foreign architects is often justified on the ground of technology
transfer. In this sense, technology transfer is based on the assumption that the particular kind of technology
involved is not yet available in this country or is inadequate in relation to the need for it. The problem presented
by the dominant presence of foreign architects in the Philippines, however, is precisely defined by the fact that
the technology they bring in is already available in such adequate proportion that foreign consultants compete in
terms adverse to Filipino registered and licensed professionals (RLPs) and in fact displace Filipino Professional
Consultants (FPCs) from participation in significant development projects.
2.6 The disproportionate inflow versus outflow of expertise is becoming more and more serious. This means a
tremendous loss to the country in terms of educational costs. More significantly, the country is deprived of
returning Filipino RLPs’ contributions to the country’s comprehensive development.
2.7 The professional competence of Filipino Professional Consultants (FPCs), specifically Professional Consulting
Architects (PCAs) is well established and adequate to meet the country’s requirements. In fact, in many cases,
foreign consultants depend largely on the expertise and information furnished by FPCs, specially of PCAs
2.8 The primary purpose of this SPP is to complement existing professional regulatory laws (PRLs) governing the
practice of State-regulated professions, specifically architecture, as governed by R.A. No. 9266 (The Architecture
Act of 2004) and its derivative regulations, and other pertinent laws such as R. A. No. 8293 known as the
“Intellectual Property Code of the Philippines” and its IRR, R. A. No. 9184 known as “Government Procurement
Reform Act (GPRA) of 2003” and its IRR (latest as of 2009), or as defined by the Code of Ethical Standard (CES),
other Standards of Professional Practice (SPPs) and other related laws, policies, rules and regulations approved
and implemented by the Commission and/or other concerned government entities. Therefore, nothing in this SPP
on Professional Architectural Consulting Services (PACS) must unduly affect the said laws, policies, rules and
regulations, and the CES and SPPs.
3. OBJECTIVES
3.1 By law, Professional Consulting Architects (PCAs) must first be registered and licensed Architects (RLAs). As such,
the standards and parameters, to which PCAs who offer and/or make their services available, are adhered to in
order to develop and nurture the competencies, credibility and integrity of PCAs in their respective fields/areas of
specialization;
3.2 Scope, type and nature of professional architectural consulting services (PACS) that only RLA-PCAs shall be allowed
to extend or perform for the Government, for the private sector and CSOs and for members of the international
community (with projects on Philippine soil), relative to or in connection with any aspect of comprehensive
development at all levels – national, regional and/or local, are defined;
3.3 Full compliance with the applicable advisories and guidelines on the selection, commissioning and engagement of
foreign architects and/or foreign consultants (FCs) for projects and services on Philippine soil, promulgated and/or
prescribed by the Commission and/or the Professional Regulatory Board of Architecture (PRBoA), through the
integrated and accredited professional organization of Architects (IAPoA), as a measure to stimulate the local
market for Filipino professional consultants (i.e. RLA-PCAs) and to protect and level the field of professional
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practice between and among RLAs and FAs/FCs;

3.4 Application by Filipino Architects (i.e. RLA-PCAs) of their familiarity with local physical, social (e.g. educational,
health, historical and cultural), economic, business, and institutional (e.g. political, governance, administrative
and legal) and environmental conditions in relation to the practice of their profession towards the attainment of a
sustainable and comprehensive development; and
3.5 A nurturing environment that will encourage Filipino professional consultants (i.e. RLA-PCAs) to practice, further
develop and/or extend their services in the country rather than abroad, and propel them to the same level as, if
not to greater heights than, their counterparts in the global market;
4. DECLARATION OF POLICY
4.1 All accredited professional organizations (APOs) are committed to abide by, advocate, and steadfastly uphold the
ideals enunciated under Section 14, Article XII of the 1987 Constitution of the Philippines which states that, “The
sustained development of a reservoir of national talents consisting of Filipino scientists, entrepreneurs,
professionals, managers, high-level technical manpower and skilled workers and craftsmen in all fields shall be
promoted by the State. The State shall encourage appropriate technology and regulate its transfer for the
national benefit. The practice of all professions in the Philippines shall be limited to Filipino citizens, save in
cases prescribed by law xxx”. (emphases and underscoring supplied)
4.2 It shall be mandatory upon all State-registered and licensed professionals (RLPs) such as RLAs, to strictly adhere to
their respective policies and standards of professional practice (SPPs) within the framework and in support of the
constitutional provision stated therein, including and most especially within the bounds of the scope of practice of
each profession as defined by their respective professional regulatory laws (PRLs) such as R.A. No. 9266 and its
derivative regulations.
5. DEFINITION OF TERMS
5.1 Comprehensive Development
refers to the holistic and progressive growth and advancement of a community, province, region and nation
inclusive of their respective economic, social, physical, environmental and institutional sectors.
5.2 Consortium or Association
refers to a coalition of purely Filipino professional consultants (i.e. RLA-PCAs) or consulting firm/s (i.e. SEC- and/or
PRC-registered architectural firms/ RAFs); or Filipino professional consultants (i.e. RLA-PCAs) or consulting firm/s
(i.e. RAFs) in collaboration with foreign professional consultant/s and/or foreign consulting firm/s authorized to
render consulting/ consultancy services, as herein defined; in the Philippine setting, the use of the terms
Consortium and Association may carry certain tax and legal implications;
5.3 Consulting Architect (FPCA), Filipino Professional
(see Filipino Professional Consulting Architect or FPCA)
5.4 Consultant, Foreign
(see Foreign Consultant or FC)
5.5 Consulting Architect (PCA), Professional
(see Professional Consulting Architect or PCA)
5.6 Consulting Agreement
means a binding covenant or understanding entered into by a professional consulting architect (PCA) and/or
consulting firm (i.e. RAF only) with an Owner/ Client, whether in Government, private sector or CSO or the
international community (with projects on Philippine soil), that provides such terms and conditions mutually
agreed upon by the parties, under which specific work, study or joint venture requiring special or technical skills
and expertise, shall be undertaken
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5.7 Consulting Architectural Firm (CAF)

refers to an architectural corporation, association, group or partnership duly registered with the Securities and
Exchange Commission (SEC) or other concerned government regulatory agency or instrumentality or to a single
proprietorship duly registered with the Department of Trade and Industry (DTI), and likewise registered with the
Commission/ Board to perform State-regulated architectural services such as professional architectural consulting
services (PACS) as herein defined.
5.8 Cost, Total Project (see Project Cost)
5.9 Cost, Salary (see Salary Cost)
5.10 Direct Costs or Reimbursable Expenses
refer to expenses in connection or related to the project that may include but not limited to the following:
5.10.1 living and travelling expenses of employees, partners, and principals when away from the home office on
business
5.10.2 identifiable communication expenses, such as long-distance telephone, telegraph, internet, short
messaging system (SMS), cable, express charge, postage, etc.;
5.10.3 services directly applicable to the contracted architectural consulting work, such as special legal and
accounting expenses, computer rental and programming costs, special consultants, borings, laboratory
charges, commercial printing and bindings and similar costs that are not applicable to general overhead;
5.10.4 identifiable expenses for supplies and materials charged to the project at hand, as distinguished from
such supplies and expenses applicable to two or more projects;
5.10.5 Identifiable reproduction costs applicable to the work, such as blue-printing, mimeographing, printing,
etc.;
These also include expenses, which seldom can be determined in advance with any invoice costs, plus a service
charge as may be mutually agreed upon by the professional consulting architect (PCA) and his Client, and in
accordance with the Architect’s Guidelines.
5.11 Filipino Professional Consulting Architect (FPCA)
refers to a Filipino citizen, a natural person who possesses the qualifications of a Filipino Professional Consultant
(FPC) as hereafter defined; the FPCA must be a Philippine-registered and licensed architect (RLA) and must be a
member in good standing of the IAPoA; the FPCA must also be a RLA specializing in any or several branch/es of the
State-regulated profession of architecture as defined under R.A. No. 9266 and its derivative regulations; if the
FPCA signs and seals architectural documents, he then becomes an Architect-of-record (Aor) for a project and
thereby assumes the attendant professional responsibilities and civil liabilities consistent with the provisions
under valid and subsisting laws.
5.12 Foreign Consultant (FC) or Foreign Architect (FA)
refers to an individual, not a citizen of the Philippines, who:
5.12.1 satisfies the definition of a Professional Consulting Architect (PCA) as hereafter provided;
5.12.2 has acquired a permit to work and/ or do business in the Philippines in accordance with the rules and
regulations of the Commission Guidelines for the Registration of Foreign Professionals (Res. No. 98-547);
has acquired a temporary/special permit (TSP) to engage in the practice of any branch of architecture for
any project on Philippine soil in full accordance with the pertinent Board Resolutions implementing Secs.
37 and 38 of R.A. No. 9266;
5.12.3 is allowed by the Department of Labor and Employment (DoLE), Bureau of Immigration and Deportation
(BID) and other concerned regulatory agencies and/or instrumentalities of government to practice the
State-regulated profession of architecture in the Philippines, under pertinent laws, rules and regulations;
and
5.12.4 is a registered and/or licensed professional architect in his own country of origin (and/or country of
residence/practice, as applicable).
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5.13 Multiplier
refers to a factor which compensates the Professional Consulting Architect (PCA) for the following items:
5.13.1 overhead costs of the office;
5.13.2 fringe benefits and social charges;
5.13.3 fee for contingencies;
5.13.4 interest on capital reserves; and
5.13.5 profit
The “multiplier” varies according to the types of architectural consulting work, the organization and experience of
the Professional Consulting Architect (PCA) and the geographic area in which his office is located.
5.14 Overhead refers to the following:

5.14.1 provisions for office, light, air-conditioning, and similar items for working space;
5.14.2 depreciation allowances or rental of furniture, equipment and instruments;
5.14.3 vehicle and travel-related expenses;
5.14.4 office supplies;
5.14.5 taxes and insurances other than those included as salary cost;
5.14.6 library and periodical expenses and other means of keeping abreast with new developments and/or
technologies;
5.14.7 executive, administrative, accounting, legal, stenographic, and clerical salaries and expenses, other than
those that are identifiable as salaries including reimbursable non-salary expenses, plus salaries or
imputed salaries of partners and principals to the extent that they perform general executive and
administrative services as distinguished from technical or advisory services directly applicable to
particular projects; these services and expenses, essential to the conduct of the business, includes
preliminary arrangements for new projects or assignments, and interest on borrowed capital;
5.14.8 business development expenses, including salaries of principals and salary costs of employees so
engaged; and
5.14.9 provision for loss of productive time of technical employees between assignments, and for time of
principals and employees on public interest assignments
5.15 Professional Consulting Architect (PCA)

refers to any person, whether natural or juridical, duly licensed, registered and/or duly accredited by the
Commission. This also refers to a person, whether natural or juridical, duly certified/recognized by the concerned
APO under the PTC or CBNE as one who possesses the appropriate knowledge and, skills, training, and relevant
experience i.e. specialization/s required to perform and/or render the service/s required; the PCA must be a
Philippine-registered and licensed Architect (RLA), with a valid registration certification and Commission
identification (ID) card and must be a member in good standing of the IAPOA.
5.16 Professional Organization, Accredited (APO)

generally refers to any organization under the umbrellas of the CBNE and PTC; in the case of professional
architectural consulting services (PACS), the term shall specifically refer to the IAPOA;
5.17 Professional Architectural Consulting Services (PACS)

means the rendering by a professional consulting architect (PCA) or by a consulting firm (i.e. a RAF), of
independent advice, extension of technical assistance and services, as well as undertaking of activities, requiring
appropriate knowledge, skills, training and experience, recognized competence, integrity, and/or financial and
logistical capability.
5.18 Project Cost
means the total cost of the project which includes but is not limited to construction cost, fees for professional
services, the cost of land, right-of-way (ROW), legal, administrative and other related expenses of the client.
5.19 Reimbursable Expenses (see Direct Costs)
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5.20 Salary Cost

means the cost of salaries (including sick leave, vacation, holiday and incentive pay applicable thereto) of
professional consultants for the time directly chargeable to the projects; plus excise, and payroll taxes as well as
all other imposable taxes/duties; and contributions for social security and insurance benefits.
6. SCOPE OF PROFESSIONAL ARCHITECTURAL CONSULTING SERVICES (PACS)

The scope of professional architectural consulting services (PACS) shall be defined and determined in accordance with
the charter, by-laws, policies, rules and regulations of the Commission and the Board through the IAPOA to which a
professional consulting architect (PCA) belongs as a member in good standing. It includes, but shall not be limited to the
following:
6.1 program / project conceptualization and development;.
6.2 rendering of technical advice, consultation and/or counselling ;
6.3 preparation of schematic/concept-level through preliminary plans, drawings, designs and technical specifications;
6.4 teaching, lecturing, coaching, mentoring;
6.5 research and development (R&D);
6.6 documentation;
6.7 conduct of pre-investment/pre-feasibility and feasibility studies;
6.8 marketing and promotional studies;
6.9 land use and multi-sectoral development planning, development and management;
6.10 site selection, analyses, evaluation, ranking and development;
6.11 construction;
6.12 Project/ Construction Management and/or Administration;
6.13 post-construction evaluation
6.14 monitoring and evaluation;
6.15 training, capability building and Continuing Professional Education (CPE); and
6.16 Capital Investment Programming
7. QUALIFICATIONS OF PROFESSIONAL CONSULTING ARCHITECTS (PCAs)

A Professional Consulting Architect (PCA) must possess all of the following qualifications:
7.1 if a natural person, must be a citizen of the Philippines who is a duly registered and licensed Architect (RLA), a
holder of a valid identification (ID) card-license issued by the Commission and a member in good standing of the
IAPOA;
7.2 if a juridical person, a consulting firm that must be a partnership or corporation duly registered with the Securities
and Exchange Commission (SEC) or a sole proprietorship that is a duly registered with the Department of Trade
and Industry (DTI), respectively and/or any other concerned regulatory agency/ies of government; in addition, the
consulting firm must possess a valid Commission certificate to operate as a registered architectural firm (RAF) in
full accordance with R.A. No. 9266 and its derivative regulations;
7.3 Must have the minimum years of active and relevant professional training and experience in the chosen field/s of
specialization as may be determined by the IAPOA and the PRBoA/ Commission;
7.4 Endorsed and certified by the IAPOA as a member in good standing; and
7.5 Has never been convicted of any criminal or administrative offense related to deliberate wrongdoing.
8. SELECTION OF PROFESSIONAL CONSULTING ARCHITECTS (PCAs)

Clients shall consider the following criteria or general guidelines in the selection of Professional Consulting Architects
(PCAs):
8.1 The major consideration in hiring the services of a Professional Consulting Architect (PCA) is his/her qualifications
as herein provided such as competence, capabilities and integrity;
8.2 Only duly-qualified Filipino professional consulting Architects (FPCAs) shall render architectural consulting services
in areas or fields of architectural specialization performed by members of the CBNE, except where no qualified
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FPCA is available. Under the said circumstances, where a non-FPCA i.e. a FA or FC is engaged, a minimum of two
(2) Filipino RLAs in the same area or field of architectural specialization shall be employed as understudies; and
8.3 For Government projects, the selection of PCAs shall be in accordance with the relevant provisions of R. A. No.
9184, otherwise known as the Government Procurement Reform Act (GPRA) of 2003.
9. MANNER OF PROVIDING PROFESSIONAL ARCHITECTURAL CONSULTING SERVICES (PACS)

A Professional Consulting Architect (PCA) may provide services directly or indirectly to the Client in the manner
prescribed, suggested or promulgated by the Commission/Board through the IAPOA.
10. COMPENSATION OF PACS

10.1 The computation of the compensation of fees for professional architectural consulting services (PACS) shall
depend on the type of services to be rendered and the conditions under which they are to be performed;
10.2 Compensation for PACS that require only one kind of expertise/specialization or related types of expertise shall be
treated differently from those services that require the use of more than one type of expertise;
10.3 Compensation and allowances shall be comparable with foreign consulting service compensation standards;
10.4 For the same scope of work, there shall be no disparity in the compensation between Filipino professional
consulting Architects (FPCAs) and their foreign consultant (FC) counterparts;
10.5 Professional Consulting Architects (PCAs) shall adhere to and be governed by the relevant provisions pertaining to
compensation as provided for under the Codes of Ethical Conduct (CEC) and the other Standards of Professional
Practice (SPP);
10.6 All entities, whether in the Government, private sector or CSOs and the international community (with projects on
Philippine soil) shall respect and take cognizance of said CEC and SPPs;
10.7 Compensation of a professional consulting Architect (PCA) may be computed based on one or a combination of
the following methods, with modifications applicable to the types of services and/ or specific cases, if and when
needed:
10.7.1 Per Diem or Hourly Basis
This method is particularly suited to engagements involving intermittent personal service. When such
consulting services are furnished, the Professional Consulting Architect (PCA) is compensated for all the
time he devotes to the work, including travel time. The per diem charge should be based on the
complexity of the work involved and the extent of his experience/specialization. In addition to the
compensation based on per diem, his expenses for travel, subsistence, and other out-of-pocket expenses
incurred while away from his home/office shall be reimbursed by the Client.
10.7.2 Retainer
This method of remuneration is used when the services of a Professional Consulting Architect (PCA) is
expected to be required at intervals over a period of time. It is a means of ensuring in advance that his
services will be available to the Client when required. Under this method, a stipulated amount is paid at
regular intervals for which the PCA is obligated to render a certain service or to spend a certain amount of
time on Client’s requirements. The compensation is usually enough to pay for the minimum services
required by the Client. All additional services are paid separately. In addition to the retainer, the PCA
may be reimbursed for travel, subsistence and other out-of-pocket expenses incurred while away from
his home/office.
10.7.3 Salary cost times a multiplier, plus direct cost or reimbursable expenses
This method is based on the total basic salaries of all PCAs and their staff multiplied by a factor from 3.0
as a multiplier plus cost of certain items that are reimbursable to the PCA classified under “Direct Cost” or
“Reimbursable Expenses”. The following formula is used to compute the fee:
Fee = Salary Cost x Multiplier + Reimbursable Expenses
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This method of remuneration is best suited for Projects for which the costs are difficult to pre-determine
or in cases where it may become necessary to undertake additional experimental or investigative work,
the result of which may further alter the scope of the project.
The method however, cannot be used as a measure of compensation for services which cannot be
measured by the length of time spent on his work.
The other part of the remuneration by this method is made up of the reimbursable direct costs. These
costs are billed to the Client supported, if required by receipts and other documents.
10.7.4 Fixed/ Lump Sum payment

This method of compensation may be used when the scope of PACS required can be clearly and fully
defined. Two methods may generally be used to arrive at a lump-sum compensation for the basic PACS.
These two methods are frequently used concurrently with one serving as a check on the other.
10.7.4.1 computation of a lump-sum as an appropriate percentage of the estimated total cost of the
project
10.7.4.2 direct development of a fixed amount of compensation by estimating the individual elements of
the cost outlines, plus a reasonable margin of profit, all expressed as a single lump-sum
Where compensation is given on a lump-sum basis, the agreements should contain a clearly stated time
limit during which the service/s will be performed, and a provision for additional compensation for extra
time used. In design assignments, these should be a provision for charges required after the approval of
preliminary designs, with a clear understanding as to where the final approval authority lies.
10.7.5 Percentage of total project cost
The remuneration under this method is calculated as an agreed percentage of the ultimate cost of the
project/service. The validity of the Percentage of Total Project Cost Method rests upon the assumption
that consultancy costs vary in proportion to the total project cost regardless of the type or location of the
project. Therefore, this method should be applied only where experience has established some
approximate correlations between consultancy costs and project costs.
10.8 Fees for services that require inputs of an artistic, innovative and creative endeavour shall not be determined in
the same manner as services that involve purely technical and scientific undertakings
10.9 Criteria for Establishing Method of Compensation
The criteria for establishing method/s of compensation shall be promulgated, approved and adopted by the
IAPoA.
10.10 Interest Due on Late Payment of Fees
The Professional Consulting Architect (PCA) shall be entitled to interest at the prevailing rate set by the Bangko
Sentral ng Pilipinas (BSP) in additional to a percentage as may be determine by the IAPOA unless otherwise
mutually agreed upon by the PCA and his Client, on all fees, other charges and reimbursements due and not paid
within 30 days from receipt of billing.
11. SEAL AND USE OF SEAL UNDER PACS

Where applicable and in full accord with R.A. No. 9266 and its derivative regulations, a Professional Consulting Architect
(PCA) shall sign and affix his professional license number and the seal duly-approved by the Commission/ PRBoA and/or
the IAPOA on all architectural documents as outputs and other deliverables/materials such as, but not limited to plans,
designs, technical drawings and specifications, feasibility studies as well as instruments of service, prepared by him, or
under his/her direct supervision, if and only if the CA shall also act as the Architect-of-record (Aor), in which case he must
assume all the attendant/pertinent professional responsibilities and civil liabilities for the project.
12. INTELLECTUAL PROPERTY RIGHTS FOR PACS

All architectural documentary outputs and materials delivered or rendered by a professional consulting Architect (PCA),
such as, but not limited to plans, designs, technical drawings and specifications, pre-feasibility and feasibility studies and
other instruments of service, shall be protected under Secs. 20 (4) and 33 of R.A. No. 9266 and its 2004 IRR, whether
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such outputs and materials are executed or not. No person without the written consent of the professional consulting
Architect (PCA) or author of said architectural documents and/or materials shall duplicate or make copies of said
documents for use in the repetition of and for other projects, whether executed partly or in its entirety.
13. PROFESSIONAL RESPONSIBILITY AND CIVIL LIABILITY FOR PACS

13.1 Any individual, partner, firm/corporation/consortium or joint ventures which engage in the practice of professional
architectural consulting services (PACS) is legally responsible i.e. professionally responsible before the State and
civilly liable before the State, the general public and the Client, for the conduct and performance of his/her
services to their Clients, whether in the Government, private sector or civil society or the international community
(with projects on Philippine soil).
13.2 Where applicable, it is imperative that a Professional Consulting Architect (PCA) secures a Professional Liability
Insurance Policy, professional indemnity insurance or equivalent in bond form commensurate with the magnitude
and scope of project involvement with the corresponding compensation. Such cost shall form part of the total
project cost chargeable to the Client.
14. APPLICABILITY
This Standard of Professional Practice (SPP) for Professional Architectural Consulting Services (PACS) shall be adopted by
the IAPOA, which shall thereafter formulate the covering guidelines and Manual of Procedure (MoP).
15. ALTERNATIVE DISPUTE RESOLUTION (ADR)

In case of any dispute arising from the implementation of these IRR and related derivative regulations, the same shall be
resolved by modes of alternative dispute resolution (ADR) mandated under R.A. No. 9285 (the ADR Act of 2004 and its
IRR) before it is referred to a competent court. The ADR modes must necessarily include negotiation, conciliation,
mediation and arbitration. An ADR clause must therefore form part of all PCAS agreements.
16. PENALTY CLAUSE AND SANCTION
Any individual, partner, firm/corporation/ consortium who/which engages in professional architectural consulting
services (PACS), but are not qualified in accordance with the provisions prescribed by law, particularly under R.A. No.
9266 (The Architecture Act of 2004) and its IRR, shall be subject to sanction/s by the appropriate public or private
entities, without prejudice to the filing of appropriate criminal, civil administrative or special complaints pursuant to
existing laws.
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Office Management Basics

In order to successfully manage an office, regardless of your company's product or even your customer base, you should
adhere to some basic guidelines. Here are six areas that you should keep in mind:
1. Employment and human resources. It's critical to have an employment policy in place. A policy manual gives you a
blueprint for the way the company approaches employment. It spells out rules in a way that can prevent later
problems. (Imagine working for an organization that came to a standstill each time an employment issue arose.) In
addition, you'll want to include a training and development program under this area. Even if your training and
development program is modest, you still need to consider building this into your policy.
2. Project management. Keeping track of projects is critical to the successful completion of important tasks and
represents an essential piece of documentation. Knowing when things have to be completed and by whom gives
everyone a clear idea of what's ahead. Deadlines are less likely to be missed and people are more likely to know
their roles. Plus, each project, through careful documentation, can become a useful case study for future
assignments.
3. Equipment and furniture requirements. You don't need every piece of office equipment out there to run a smooth
operation. But you do need certain products that are going to optimize people's performance. What you need and
how much it will cost are simple but important considerations. Check out What Office Equipment Do I Need for My
Business? for a good introduction. And what about software? Are you trying to achieve a paperless office? If not, do
you know how you'll store certain documents? Answering these and other questions about equipment will help you
to prepare for the growth of your office.
4. Inter- and intra-office communications. For many small businesses, the responsibility for communication falls upon
the office manager. Knowing how and when to communicate key information is vital to successful office
management. E-mail blasts, posted instructions at the copier, and weekly staff meetings are just a few of the types
of communication that occur within a busy office. Having a communication plan that everyone can adhere to will
increase an office's productivity and ensure that information is disseminated clearly and quickly.
5. Conflict resolution. Conflicts are inevitable. Knowing how to handle them properly, however, will make life easier.
Whether you have a formal policy or rely on your own wits, you need to prepare yourself for a wide variety of
disagreements. Even with an employment manual, such issues as equitable distribution of work, pay rates, and job
descriptions often arise in a company. Ignoring a conflict or waiting for it to dissipate is never the right solution.
Having a plan or a policy for conflict resolution will help everyone navigate through a disagreement in a professional
manner.
6. The company and its people. Knowing how to run an office must include understanding the company and its people.
Knowing the product line and how it fulfills a need is just as important as ordering more toner for the printer. If you
don't understand your company's mission, you won't know how best to support its various functions. The same goes
for people — knowing employees' roles, where they fit into the big picture, and how they operate will help you
manage the office so that every function supports the people tasked with getting things done. The more you know
about how the company works and what people are doing to build business, fulfill customer requests, meet
deadlines, and otherwise perform their duties, the more successful you'll be in creating and sustaining an
environment that fosters success.
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PROJECT MANAGEMENT
General Overview
Project management is the discipline of planning, organizing, securing, and managing resources to achieve specific goals. A
project is a temporary endeavor with a defined beginning and end, usually time-constrained, and often constrained by
funding or deliverables, undertaken to meet unique goals and objectives, typically to bring about beneficial change or added
value.
The temporary nature of projects stands in contrast with business as usual, or operations, which are repetitive permanent, or
semi-permanent functional activities to produce products or services. In practice, the management of these two systems is
often quite different, and as such requires the development of distinct technical skills and management strategies.
The primary challenge of project management is to achieve all of the project goals and objectives while honoring the
preconceived constraints. Typical constraints are scope, time, and budget. The secondary and more ambitious challenge is to
optimize the allocation and integrate the inputs necessary to meet pre-defined objectives.
History
Project management has been practiced since early civilization. Until 1900 civil
engineering projects were generally managed by creative architects, engineers, and
master builders themselves, among those for example Vitruvius: 1st century
BC, Christopher Wren: 1632–1723, Thomas Telford: 1757–1834 and
Isambard Kingdom Brunel: 1806–1859. It was in the 1950s that organizations
started to systematically apply project management tools and techniques to
complex engineering projects.
As a discipline, Project Management developed from several fields of application
including civil construction, engineering, and heavy defense activity. Two
forefathers of project management are Henry Gantt, called the father of planning
and control techniques, who is famous for his use of the Gantt chart as a project
management tool; and Henri Fayol for his creation of the 5 management
functions which form the foundation of the body of knowledge associated with
Henry Gantt (1861–1919), the father of planning and control techniques.
project and program management
Both Gantt and Fayol were students of Frederick Winslow Taylor's Theories of Scientific Management. His work is the
forerunner to modern project management tools including Work Breakdown Structure (WBS) and Resource Allocation.
The 1950s marked the beginning of the modern Project Management era where core engineering fields come together
working as one. Project management became recognized as a distinct discipline arising from the management discipline with
engineering model. In the United States, prior to the 1950s, projects were managed on an ad hoc basis using mostly Gantt
Charts, and informal techniques and tools.
At that time, two mathematical project-scheduling models were developed. The "Critical Path Method" (CPM) was developed
as a joint venture between DuPont Corporation and Remington Rand Corporation for managing plant maintenance projects.
And the "Program Evaluation and Review Technique" or PERT, was developed by Booz Allen Hamilton as part of the United
States Navy's, in conjunction with the Lockheed Corporation, Polaris missile submarine program; These mathematical
techniques quickly spread into many private enterprises.
At the same time, as project-scheduling models were being developed, technology for project cost estimating, cost
management, and engineering economics was evolving, with pioneering work by Hans Lang and others. In 1956, the
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American Association of Cost Engineers, now AACE

International; the Association for the Advancement of Cost
Engineering, was formed by early practitioners of project
management and the associated specialties of planning and
scheduling, cost estimating, and cost/schedule project control. AACE
continued its pioneering work and in 2006 released the first
integrated process for portfolio, program and project management,
Total Cost Management Framework.
PERT network chart for a Seven month project with Five milestones
The International Project Management Association, IPMA was founded in Europe in 1967, as a federation of several national
project management associations. IPMA maintains its federal structure today and now includes member associations on
every continent except Antarctica. IPMA offers a Four Level Certification program based on the IPMA Competence Baseline,
ICB. The ICB covers technical competences, contextual competences, and behavioral competences.
In 1969, the Project Management Institute, PMI was formed in the USA. PMI publishes A Guide to the Project Management
Body of Knowledge, PMBOK Guide, which describes project management practices that are common to "most projects, most
of the time." PMI also offers multiple certifications.
1. The Manager
The Manager as executive is the most difficult and has the highest degree of responsibility. The nature of his job is varied
from the simplest to the most complicated one. Being the bridge between top management and staff, he is always blamed
for mismanagement, and yet oftentimes not praised for his success. But his job is always in his mind no matter what he is.
Managers who are not prepared for the difficult task of management, break down earlier than is expected, not only because
of pressure from work but also because of mental torture caused by problems encountered and have to solve.
Quality of an Effective Manager
An effective manager must have the following qualities:
1. He studies, analyzes and dissects his job.
2. He knows how to delegate the administrative details of his job.
3. He is willing to delegate to and share with his subordinates the credit of a job well done.
4. He trains and develops his men to prepare them to assume delegated work.
5. He knows how to control and plan his time.
6. He institutes controls for effective performance.
A. Executive Functions and Leadership

Executive Functions
Managers do not do the actual work of an organization. His specific functions are:
Planning. Is the job of making things happen that would otherwise not occur? It is an intellectual process, the conscious
determination and direction of action. Planning is economic and essential control necessary because of uncertainty and
change. Plans may be classified as:
a. Objectives of the enterprise d. Budget
b. Policies e. Programs
c. Procedures
Organizing. A good organizational structure does not guarantee good performance, but a poor one makes good
performance impossible, either the caliber of the individual managers notwithstanding. Improving the organization will
always improve performance. In short, a good organizational structure is necessary though not a sufficient condition for
good performance.
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Directing. Directing is guiding and overseeing subordinates. One can plan, organize a staff, but until subordinates are
taught what to do & told to get on with the job, nothing gets done. In directing, two processes enter the picture;
leadership & coordination. Leadership and coordination are ultimately bound together. Without effective leadership,
coordination cannot be achieved.
Leadership has been defined as; the process, by which an executive imaginatively directs, guides or influences the work
of other in choosing and attaining particular ends. Leadership is more than excellence in administrative performance.
Coordination is the process whereby and executive develops an orderly pattern of group effort among the subordinates,
and secures unity of action in the pursuit of common purpose. How can executives coordinate efforts in their
organization?
a. Clarifying authority and responsibility.
b. Careful checking and observation.
c. Facilitating effective communications.
d. Utilizing leadership skills.
Control. Control has been defined as the process by which an executive gets the performance of his subordinates to
correspond as closely as possible to chosen plans, orders, objectives, or policies.
Control calls for the evaluation of results, comparison of those with established standards, and the taking of measures to
correct discrepancies that appear.
The span of control refers to still another principle of organization. The number of persons reporting directly to one
executive should be limited because, the larger the number, the more difficult it is to supervise and coordinate them
effectively.
The number that can be supervised effectively depends on such factors as the nature of the delegated responsibilities,
the abilities of the subordinates and the assistance available to him by a staff. Common practices are 4 to 8 for the top
levels and 8 to 15 for the bottom levels.
Policies and Procedures
In planning, the critical task is the formulation of policies. Policies are general statements, which guide or channel the
thinking and action of members of an organization. Procedures are reflection of policy. It involves the selection of a
course of action and applied to future activities. Procedures also detail the manner in which a certain activity must be
accomplished.
Executive Leadership
Executive Leadership is the bridge between objectives and result. Human progress is the crowning glory of success.
Success is the result of good management. And management is the effective, efficient and economical utilization of the
resources of man, money, materials, machine, methods and memoranda.
The responsibility for management is vested primarily on the manager. He is the fellow who gets things done through
the efforts of others. He is the fellow at the top of the organizational pyramid. He is the leader of the organization, and
a good leader usually makes a good manager.
As a leader, the manager should be an example of good personal appearance, pleasant mannerisms, and good health so
that he can command respect among his subordinates. He must be a paragon of honesty, intelligence, enthusiasm,
aggressiveness, loyalty, vision, initiative, perseverance, and decisiveness as to establish employee’s confidence in him.
He should possess adaptability, understanding, patience and self-control, so that he will be able to see the two sides of
any problem brought to him and thus, exercising fairness to all. He must have a good judgment and leadership ability. In
short, the manager must be a boss at the same time a leader.
Leadership is the ability to motivate subordinates and other people toward the achievement of organizational objectives.
The ability to influence, persuade and motivate followers is based largely upon the perceived power of the leader.
A leader, who desires to serve, leads by example. He must possess at least a certain degree of imagination and vision.
He must be able to think ahead to visualize and to pan beyond the immediate present.
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A leader must have a goal, which is practical and right. With such qualities, he will certainly command the respect of
others and be a true leader, but the best training in management is actual management.
New Concept of Leadership
The new concept of leadership today is a matter of service, not control. Ideal leadership is changing fast where the age
of order from above, obedience below has come to an end. People resist orders & dictates what they believe is just &
fair unto them. Ideal leadership now is to aid communication & create a sense of unity, enthusiasm and cooperation
among the members of a team.
Based from theories and researches, there is certainly no best leader style or theory of leadership. The choice of the
leadership style to employ must take into account the company’s objectives, policies and organizational climate.
Definitely, the best leadership style to use is the one that consider the internal environment existing in the organization.
B. Delegation of Authority and Responsibility
Delegation of Authority
Delegation of authority is the key to effective management. In order to have control, the manager must have authority.
Authority is the power of an administrator to delegate functions to the next ranking executive, who in turn transmit it to
the employees who are charged with the actual operations.
Authority however, should have a definite limitation to avoid confusion. The authority vested upon an executive should
preferably be in writing. It should be interpreted clearly to avoid misunderstanding between the boss and the
subordinates.
When a work is given, it must be within the paths of authority. But before giving an order, it should be determined first if
it is necessary, properly interpreted, and whether the proper authority is behind it.
Delegation of a task to a subordinate is a manifestation of faith and confidence towards the ability of a subordinate. It
gives the subordinate an added responsibility and authority, which will be his tools for growth and improvement.
However, subordinates must be trained and prepared for the job before the additional assignment is given. Otherwise,
he may refuse a delegated work if he believes that he is not prepared for the new task.
Justifiable praise and commendation should be given the deputy for a work well done. Recognition is a basic human
desire and is an incentive for further achievement. This is one of the means for executive development and or building
morale.
Responsibility and Authority Defined
One famous professor on administration defines responsibility as “Hell” without authority. There are people who
constantly seek for authority, but evade responsibility. This is called buck passing. Authority and responsibility must go
together. But authority cannot be delegated completely. It can only be shared.
The president may delegate any or part of his authority because he must share if he expect to get the necessary counsel
of experienced or specialist’s workers in the company. On the other hand, advises which are fed by other persons who
do not share in the responsibility if of questionable value.
Yet, even with the aid of responsible consultants, there is always that element of risk in decisions. The true experts will
be the first to admit the possibility of error in his recommendations. Who will assume the risk? And who will make the
decisions? Probably the best answer is that; decisions should result from the pooling of judgment of those who share in
the responsibility and authority under the situation in question. The president or manager is still held responsible for the
action and liabilities of the company, including the cause of strikes due to labor disputes.
C. Personnel Coordination
The company organization is also dependent upon the special abilities and skills of personnel to perform the work. This
is true particularly in the establishment of leaders, supervisors and foremen. Two factors are significant.
1. The need for close supervisions as judged by the skill of the workers and the difficulty of the operations.
2. The availability of experienced and trust worthy personnel capable of acting in supervisory qualities.
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The shortage of people who are capable of leadership and supervision of others is one of the biggest difficulties
encountered by companies, and this may be due to:
1. Lack of incentive in the supervisory positions.
2. Inadequate or ineffective recruitment of those personnel possessing potential leadership ability.
3. Insufficient training of present and potential supervisory personnel.
Virtually, project-construction bring-together people with diverse knowledge and skills. Most of the workers associate
with the project for less than its work duration. Some go from one project to another as their services is needed while
others are on loan either on a full time or part time basis from their regular job. This is usually the case when special-
projects exist within the framework of a more traditional organization.
People with special knowledge are abilities are selected to work on special projects. Some workers on the other hand,
are not so eager to join a project because it may mean working for two bosses, disruption of friendship and daily routine
and risking the possibility of being replaced on the job. Aside from these, there is a fear of being connected with
unsuccessful project which might affect adversely their career advancement. On several instances, when a project is
phased out & the project team disbanded, team members tend to drift away from the organization for lack of new
project & the difficulty is returning back to the former jobs.
Some workers want to associate with more dynamic environments. They like challenges of working under pressure and
solving new problems. To them, project offers an opportunity to meet new people and increasing future opportunities
especially if the project is a successful one. And being connected with the project they gained status among fellow
workers aside from the increase of their tag price. Finally, working on projects inspires a team spirit, increasing their
morale and motivation to achieve successful completion of project goals.
D. Project managers
A project manager is a professional in the field of project management. Project managers can have the responsibility of
the planning, execution, and closing of any project, typically relating to construction industry, engineering, architecture,
computing, and telecommunications. Many other fields in the production engineering and design engineering and heavy
industrial have project managers.
A project manager is the person accountable for accomplishing the stated project objectives. Key project management
responsibilities include creating clear and attainable project objectives, building the project requirements, and managing
the triple constraint for projects, which is cost, time, and scope.
A project manager is often a client representative and has to determine and implement the exact needs of the client,
based on knowledge of the firm they are representing. The ability to adapt to the various internal procedures of the
contracting party, and to form close links with the nominated representatives, is essential in ensuring that the key issues
of cost, time, quality and above all, client satisfaction, can be realized.
Project Management Triangle
Like any human undertaking, projects need to be performed and delivered
under certain constraints. Traditionally, these constraints have been listed
as "scope," "time," and "cost". These are also referred to as the "project
management triangle", where each side represents a constraint. One
side of the triangle cannot be changed without affecting the others. A
further refinement of the constraints separates product "quality" or
"performance" from scope, and turns quality into a fourth constraint.
The time constraint refers to the amount of time available to complete a
project. The cost constraint refers to the budgeted amount available for the
project. The scope constraint refers to what must be done to produce the
project's end result. These three constraints are often competing
constraints: increased scope typically means increased time and increased
The project management triangle cost, a tight constraint could mean increased costs and reduced scope, and
a tight budget could mean increased time and reduced scope.
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The discipline of project management is about providing the tools and techniques that enable the project team, not just
the project manager, to organize their work to meet these constraints.
Management Control
Control is defined by Webster as “to check or regulate to keep within limits”. Yet managerial control carries with it a
much broader interpretation to apply: not only to neither check nor command, but also the whip. Not only to regulate,
but also to stimulate.
Control also includes activities that require restrictive or corrective action. For instance, matters like excessive labor
cost, undue equipment failure or disproportionate fuel and maintenance costs and the likes are points that require
management action and will be accomplished only if management is aware that the conditions exist. Control however,
only lead up to specific management action specifying the necessity for action and variation from routine.
The success or failure of any enterprise depends greatly upon the manager. To him, the most effective tool for
success is management or executive control. This involves setting overall objective or measurements to serve as a
yardstick for allocating resources and for evaluating performance.
To have effective control, the manager must know by heart the reasons why his business or enterprise exists. He
must have a clear perception of the needs of the business. Thus, a manager must be a good planner and a good
organizer. A long range planning is the creative force for executive control. It is an ability to set the mark and
anticipate the problems that block the way to planned results.
The Manager should be a good organizer. The organization serves as the framework for delegating authority and
fixing responsibility from a higher to a lower executive level. In developing his organization, the manager should
stress on getting the right men for the right job. He must concentrate on how to get the jobs done and on how to
prevent abuse and waste of resources.
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Risk management
Example of risk management: A NASA model showing areas at high risk from impact for the International Space Station.
Risk management is the identification, assessment, and prioritization of risks (defined in ISO 31000 as the effect of
uncertainty on objectives, whether positive or negative) followed by coordinated and economical application of resources to
minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of
opportunities. Risks can come from uncertainty in financial markets, threats from project failures (at any phase in design,
development, production, or sustainment life-cycles), legal liabilities, credit risk, accidents, natural causes and disasters as
well as deliberate attack from an adversary, or events of uncertain or unpredictable root-cause. Several risk management
standards have been developed including the Project Management Institute, the National Institute of Standards and
Technology, actuarial societies, and ISO standards. Methods, definitions and goals vary widely according to whether the risk
management method is in the context of project management, security, engineering, industrial processes, financial
portfolios, actuarial assessments, or public health and safety.
The strategies to manage threats (uncertainties with negative consequences) typically include transferring the threat to
another party, avoiding the threat, reducing the negative effect or probability of the threat, or even accepting some or all of
the potential or actual consequences of a particular threat, and the opposites for opportunities (uncertain future states with
benefits).
Certain aspects of many of the risk management standards have come under criticism for having no measurable
improvement on risk, whether the confidence in estimates and decisions seem to increase.
Introduction
A widely used vocabulary for risk management is defined by ISO Guide 73, "Risk management. Vocabulary."
In ideal risk management, a prioritization process is followed whereby the risks with the greatest loss (or impact) and the
greatest probability of occurring are handled first, and risks with lower probability of occurrence and lower loss are handled
in descending order. In practice the process of assessing overall risk can be difficult, and balancing resources used to mitigate
between risks with a high probability of occurrence but lower loss versus a risk with high loss but lower probability of
occurrence can often be mishandled.
Intangible risk management identifies a new type of a risk that has a 100% probability of occurring but is ignored by the
organization due to a lack of identification ability. For example, when deficient knowledge is applied to a situation, a
knowledge risk materializes. Relationship risk appears when ineffective collaboration occurs. Process-engagement risk may
be an issue when ineffective operational procedures are applied. These risks directly reduce the productivity of knowledge
workers, decrease cost effectiveness, profitability, service, quality, reputation, brand value, and earnings quality. Intangible
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risk management allows risk management to create immediate value from the identification and reduction of risks that
reduce productivity.
Risk management also faces difficulties in allocating resources. This is the idea of opportunity cost. Resources spent on risk
management could have been spent on more profitable activities. Again, ideal risk management minimizes spending (or
manpower or other resources) and also minimizes the negative effects of risks.
Method
For the most part, these methods consist of the following elements, performed, more or less, in the following order.
1. identify, characterize threats
2. assess the vulnerability of critical assets to specific threats
3. determine the risk (i.e. the expected likelihood and consequences of specific types of attacks on specific assets)
4. identify ways to reduce those risks
5. prioritize risk reduction measures based on a strategy
Principles of risk management

The International Organization for Standardization (ISO) identifies the following principles of risk management:
Risk management should:
 create value – resources expended to mitigate risk should be less than the consequence of inaction, or (as in value
engineering), the gain should exceed the pain
 be an integral part of organizational processes
 be part of decision making process
 explicitly address uncertainty and assumptions
 be systematic and structured
 be based on the best available information
 be tailorable
 take human factors into account
 be transparent and inclusive
 be dynamic, iterative and responsive to change
 be capable of continual improvement and enhancement
 be continually or periodically re-assessed
Process
According to the standard ISO 31000 "Risk management – Principles and guidelines on implementation," the process of risk
management consists of several steps as follows:
Establishing the context

This involves:
1. identification of risk in a selected domain of interest
2. planning the remainder of the process
3. mapping out the following:
o the social scope of risk management
o the identity and objectives of stakeholders
o the basis upon which risks will be evaluated, constraints.
4. defining a framework for the activity and an agenda for identification
5. developing an analysis of risks involved in the process
6. mitigation or solution of risks using available technological, human and organizational resources.
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Identification
After establishing the context, the next step in the process of managing risk is to identify potential risks. Risks are about
events that, when triggered, cause problems or benefits. Hence, risk identification can start with the source of our problems
and those of our competitors (benefit), or with the problem itself.
 Source analysis - Risk sources may be internal or external to the system that is the target of risk management (use
mitigation instead of management since by its own definition risk deals with factors of decision-making that cannot
be managed).
Examples of risk sources are: stakeholders of a project, employees of a company or the weather over an airport.
 Problem analysis - Risks are related to identified threats. For example: the threat of losing money, the threat of
abuse of confidential information or the threat of human errors, accidents and casualties. The threats may exist with
various entities, most important with shareholders, customers and legislative bodies such as the government.
When either source or problem is known, the events that a source may trigger or the events that can lead to a problem can
be investigated. For example: stakeholders withdrawing during a project may endanger funding of the project; confidential
information may be stolen by employees even within a closed network; lightning striking an aircraft during takeoff may make
all people on board immediate casualties.
The chosen method of identifying risks may depend on culture, industry practice and compliance. The identification methods
are formed by templates or the development of templates for identifying source, problem or event. Common risk
identification methods are:
 Objectives-based risk identification - Organizations and project teams have objectives. Any event that may endanger
achieving an objective partly or completely is identified as risk.
 Scenario-based risk identification - In scenario analysis different scenarios are created. The scenarios may be the
alternative ways to achieve an objective, or an analysis of the interaction of forces in, for example, a market or
battle. Any event that triggers an undesired scenario alternative is identified as risk.
 Taxonomy-based risk identification - The taxonomy in taxonomy-based risk identification is a breakdown of possible
risk sources. Based on the taxonomy and knowledge of best practices, a questionnaire is compiled. The answers to
the questions reveal risks.
 Common-risk checking - In several industries, lists with known risks are available. Each risk in the list can be checked
for application to a particular situation.
 Risk charting - This method combines the above approaches by listing resources at risk, threats to those resources,
modifying factors which may increase or decrease the risk and consequences it is wished to avoid. Creating a matrix
under these headings enables a variety of approaches. One can begin with resources and consider the threats they
are exposed to and the consequences of each. Alternatively one can start with the threats and examine which
resources they would affect, or one can begin with the consequences and determine which combination of threats
and resources would be involved to bring them about.
Assessment
Risk Assessment
Once risks have been identified, they must then be assessed as to their potential severity of impact (generally a negative
impact, such as damage or loss) and to the probability of occurrence. These quantities can be either simple to measure, in the
case of the value of a lost building, or impossible to know for sure in the case of the probability of an unlikely event occurring.
Therefore, in the assessment process it is critical to make the best educated decisions in order to properly prioritize the
implementation of the risk management plan.
Even a short-term positive improvement can have long-term negative impacts. Take the "turnpike" example. A highway is
widened to allow more traffic. More traffic capacity leads to greater development in the areas surrounding the improved
traffic capacity. Over time, traffic thereby increases to fill available capacity. Turnpikes thereby need to be expanded in a
seemingly endless cycles. There are many other engineering examples where expanded capacity (to do any function) is soon
filled by increased demand. Since expansion comes at a cost, the resulting growth could become unsustainable without
forecasting and management.
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The fundamental difficulty in risk assessment is determining the rate of occurrence since statistical information is not
available on all kinds of past incidents. Furthermore, evaluating the severity of the consequences (impact) is often quite
difficult for intangible assets. Asset valuation is another question that needs to be addressed. Thus, best educated opinions
and available statistics are the primary sources of information. Nevertheless, risk assessment should produce such
information for the management of the organization that the primary risks are easy to understand and that the risk
management decisions may be prioritized. Thus, there have been several theories and attempts to quantify risks. Numerous
different risk formulae exist, but perhaps the most widely accepted formula for risk quantification is:
Rate (or probability) of occurrence multiplied by the impact of the event equals risk magnitude
Composite Risk Index

The above formula can also be re-written in terms of a Composite Risk Index, as follows:
Composite Risk Index = Impact of Risk event x Probability of Occurrence
The impact of the risk event is commonly assessed on a scale of 1 to 5, where 1 and 5 represent the minimum and maximum
possible impact of an occurrence of a risk (usually in terms of financial losses). However, the 1 to 5 scale can be arbitrary and
need not be on a linear scale.
The probability of occurrence is likewise commonly assessed on a scale from 1 to 5, where 1 represents a very low probability
of the risk event actually occurring while 5 represents a very high probability of occurrence. This axis may be expressed in
either mathematical terms (event occurs once a year, once in ten years, once in 100 years etc.) or may be expressed in "plain
english" (event has occurred here very often; event has been known to occur here; event has been known to occur in the
industry etc.). Again, the 1 to 5 scale can be arbitrary or non-linear depending on decisions by subject-matter experts.
The Composite Index thus can take values ranging (typically) from 1 through 25, and this range is usually arbitrarily divided
into three sub-ranges. The overall risk assessment is then Low, Medium or High, depending on the sub-range containing the
calculated value of the Composite Index. For instance, the three sub-ranges could be defined as 1 to 8, 9 to 16 and 17 to 25.
Note that the probability of risk occurrence is difficult to estimate, since the past data on frequencies are not readily
available, as mentioned above. After all, probability does not imply certainty.
Likewise, the impact of the risk is not easy to estimate since it is often difficult to estimate the potential loss in the event of
risk occurrence.
Further, both the above factors can change in magnitude depending on the adequacy of risk avoidance and prevention
measures taken and due to changes in the external business environment. Hence it is absolutely necessary to periodically re-
assess risks and intensify/relax mitigation measures, or as necessary. Changes in procedures, technology, schedules, budgets,
market conditions, political environment, or other factors typically require re-assessment of risks.
Risk Options
Risk mitigation measures are usually formulated according to one or more of the following major risk options, which are:
1. Design a new business process with adequate built-in risk control and containment measures from the start.
2. Periodically re-assess risks that are accepted in ongoing processes as a normal feature of business operations and
modify mitigation measures.
3. Transfer risks to an external agency (e.g. an insurance company)
4. Avoid risks altogether (e.g. by closing down a particular high-risk business area)
Later research has shown that the financial benefits of risk management are less dependent on the formula used but are
more dependent on the frequency and how risk assessment is performed.
In business it is imperative to be able to present the findings of risk assessments in financial, market, or schedule terms.
Robert Courtney Jr. (IBM, 1970) proposed a formula for presenting risks in financial terms. The Courtney formula was
accepted as the official risk analysis method for the US governmental agencies. The formula proposes calculation of ALE
(annualised loss expectancy) and compares the expected loss value to the security control implementation costs (cost-benefit
analysis).
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Potential risk treatments

Once risks have been identified and assessed, all techniques to manage the risk fall into one or more of these four major
categories:
 Avoidance (eliminate, withdraw from or not become involved)
 Reduction (optimize – mitigate)
 Sharing (transfer – outsource or insure)
 Retention (accept and budget)
Ideal use of these strategies may not be possible. Some of them may involve trade-offs that are not acceptable to the
organization or person making the risk management decisions. Another source, from the US Department of Defense, Defense
Acquisition University, calls these categories ACAT, for Avoid, Control, Accept, or Transfer. This use of the ACAT acronym is
reminiscent of another ACAT (for Acquisition Category) used in US Defense industry procurements, in which Risk
Management figures prominently in decision making and planning.
Risk avoidance
This includes not performing an activity that could carry risk. An example would be not buying a property or business in order
to not take on the legal liability that comes with it. Another would be not flying in order not to take the risk that the airplane
were to be hijacked. Avoidance may seem the answer to all risks, but avoiding risks also means losing out on the potential
gain that accepting (retaining) the risk may have allowed. Not entering a business to avoid the risk of loss also avoids the
possibility of earning profits. Increasing risk regulation in hospitals has led to avoidance of treating higher risk conditions, in
favour of patients presenting with lower risk.
Hazard prevention
Hazard prevention refers to the prevention of risks in an emergency. The first and most effective stage of hazard prevention
is the elimination of hazards. If this takes too long, is too costly, or is otherwise impractical, the second stage is mitigation.
Risk reduction
Risk reduction or "optimization" involves reducing the severity of the loss or the likelihood of the loss from occurring. For
example, sprinklers are designed to put out a fire to reduce the risk of loss by fire. This method may cause a greater loss by
water damage and therefore may not be suitable. Halon fire suppression systems may mitigate that risk, but the cost may be
prohibitive as a strategy.
Acknowledging that risks can be positive or negative, optimizing risks means finding a balance between negative risk and the
benefit of the operation or activity; and between risk reduction and effort applied. By an offshore drilling contractor
effectively applying HSE Management in its organization, it can optimize risk to achieve levels of residual risk that are
tolerable.
Modern software development methodologies reduce risk by developing and delivering software incrementally. Early
methodologies suffered from the fact that they only delivered software in the final phase of development; any problems
encountered in earlier phases meant costly rework and often jeopardized the whole project. By developing in iterations,
software projects can limit effort wasted to a single iteration.
Outsourcing could be an example of risk reduction if the outsourcer can demonstrate higher capability at managing or
reducing risks. For example, a company may outsource only its software development, the manufacturing of hard goods, or
customer support needs to another company, while handling the business management itself. This way, the company can
concentrate more on business development without having to worry as much about the manufacturing process, managing
the development team, or finding a physical location for a call center.
Risk sharing
Briefly defined as "sharing with another party the burden of loss or the benefit of gain, from a risk, and the measures to
reduce a risk."
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The term of 'risk transfer' is often used in place of risk sharing in the mistaken belief that you can transfer a risk to a third
party through insurance or outsourcing. In practice if the insurance company or contractor go bankrupt or end up in court,
the original risk is likely to still revert to the first party. As such in the terminology of practitioners and scholars alike, the
purchase of an insurance contract is often described as a "transfer of risk." However, technically speaking, the buyer of the
contract generally retains legal responsibility for the losses "transferred", meaning that insurance may be described more
accurately as a post-event compensatory mechanism. For example, a personal injuries insurance policy does not transfer the
risk of a car accident to the insurance company. The risk still lies with the policy holder namely the person who has been in
the accident. The insurance policy simply provides that if an accident (the event) occurs involving the policy holder then some
compensation may be payable to the policy holder that is commensurate to the suffering/damage.
Some ways of managing risk fall into multiple categories. Risk retention pools are technically retaining the risk for the group,
but spreading it over the whole group involves transfer among individual members of the group. This is different from
traditional insurance, in that no premium is exchanged between members of the group up front, but instead losses are
assessed to all members of the group.
Risk retention
Involves accepting the loss, or benefit of gain, from a risk when it occurs. True self insurance falls in this category. Risk
retention is a viable strategy for small risks where the cost of insuring against the risk would be greater over time than the
total losses sustained. All risks that are not avoided or transferred are retained by default. This includes risks that are so large
or catastrophic that they either cannot be insured against or the premiums would be infeasible. War is an example since most
property and risks are not insured against war, so the loss attributed by war is retained by the insured. Also any amounts of
potential loss (risk) over the amount insured is retained risk. This may also be acceptable if the chance of a very large loss is
small or if the cost to insure for greater coverage amounts is so great it would hinder the goals of the organization too much.
Create a risk management plan
Select appropriate controls or countermeasures to measure each risk. Risk mitigation needs to be approved by the
appropriate level of management. For instance, a risk concerning the image of the organization should have top management
decision behind it whereas IT management would have the authority to decide on computer virus risks.
The risk management plan should propose applicable and effective security controls for managing the risks. For example, an
observed high risk of computer viruses could be mitigated by acquiring and implementing antivirus software. A good risk
management plan should contain a schedule for control implementation and responsible persons for those actions.
According to ISO/IEC 27001, the stage immediately after completion of the risk assessment phase consists of preparing a Risk
Treatment Plan, which should document the decisions about how each of the identified risks should be handled. Mitigation of
risks often means selection of security controls, which should be documented in a Statement of Applicability, which identifies
which particular control objectives and controls from the standard have been selected, and why.
Implementation
Implementation follows all of the planned methods for mitigating the effect of the risks. Purchase insurance policies for the
risks that have been decided to be transferred to an insurer, avoid all risks that can be avoided without sacrificing the entity's
goals, reduce others, and retain the rest.
Review and evaluation of the plan
Initial risk management plans will never be perfect. Practice, experience, and actual loss results will necessitate changes in
the plan and contribute information to allow possible different decisions to be made in dealing with the risks being faced.
Risk analysis results and management plans should be updated periodically. There are two primary reasons for this:
1. to evaluate whether the previously selected security controls are still applicable and effective
2. to evaluate the possible risk level changes in the business environment. For example, information risks are a good
example of rapidly changing business environment.
Midterm Handouts
Limitations
Prioritizing the risk management processes too highly could keep an organization from ever completing a project or even
getting started. This is especially true if other work is suspended until the risk management process is considered complete.
It is also important to keep in mind the distinction between risk and uncertainty. Risk can be measured by impacts x
probability.
If risks are improperly assessed and prioritized, time can be wasted in dealing with risk of losses that are not likely to occur.
Spending too much time assessing and managing unlikely risks can divert resources that could be used more profitably.
Unlikely events do occur but if the risk is unlikely enough to occur it may be better to simply retain the risk and deal with the
result if the loss does in fact occur. Qualitative risk assessment is subjective and lacks consistency. The primary justification
for a formal risk assessment process is legal and bureaucratic.
Areas of risk management

As applied to corporate finance, risk management is the technique for measuring, monitoring and controlling the financial or
operational risk on a firm's balance sheet.
The Basel II framework breaks risks into market risk (price risk), credit risk and operational risk and also specifies methods for
calculating capital requirements for each of these components.
Enterprise risk management
In enterprise risk management, a risk is defined as a possible event or circumstance that can have negative influences on the
enterprise in question. Its impact can be on the very existence, the resources (human and capital), the products and services,
or the customers of the enterprise, as well as external impacts on society, markets, or the environment. In a financial
institution, enterprise risk management is normally thought of as the combination of credit risk, interest rate risk or asset
liability management, liquidity risk, market risk, and operational risk.
In the more general case, every probable risk can have a pre-formulated plan to deal with its possible consequences (to
ensure contingency if the risk becomes a liability).
From the information above and the average cost per employee over time, or cost accrual ratio, a project manager can
estimate:
 the cost associated with the risk if it arises, estimated by multiplying employee costs per unit time by the estimated
time lost (cost impact, C where C = cost accrual ratio * S).
 the probable increase in time associated with a risk (schedule variance due to risk, Rs where Rs = P * S):
o Sorting on this value puts the highest risks to the schedule first. This is intended to cause the greatest risks
to the project to be attempted first so that risk is minimized as quickly as possible.
o This is slightly misleading as schedule variances with a large P and small S and vice versa are not equivalent.
(The risk of the RMS Titanic sinking vs. the passengers' meals being served at slightly the wrong time).
 the probable increase in cost associated with a risk (cost variance due to risk, Rc where Rc = P*C = P*CAR*S =
P*S*CAR)
o sorting on this value puts the highest risks to the budget first.
o see concerns about schedule variance as this is a function of it, as illustrated in the equation above.
Risk in a project or process can be due either to Special Cause Variation or Common Cause Variation and requires appropriate
treatment. That is to re-iterate the concern about extremal cases not being equivalent in the list immediately above.
Risk management activities as applied to project management
In project management, risk management includes the following activities:
 Planning how risk will be managed in the particular project. Plans should include risk management tasks,
responsibilities, activities and budget.
 Assigning a risk officer – a team member other than a project manager who is responsible for foreseeing potential
project problems. Typical characteristic of risk officer is a healthy skepticism.
Midterm Handouts
 Maintaining live project risk database. Each risk should have the following attributes: opening date, title, short
description, probability and importance. Optionally a risk may have an assigned person responsible for its resolution
and a date by which the risk must be resolved.
 Creating anonymous risk reporting channel. Each team member should have the possibility to report risks that
he/she foresees in the project.
 Preparing mitigation plans for risks that are chosen to be mitigated. The purpose of the mitigation plan is to describe
how this particular risk will be handled – what, when, by whom and how will it be done to avoid it or minimize
consequences if it becomes a liability.
 Summarizing planned and faced risks, effectiveness of mitigation activities, and effort spent for the risk
management.
Risk management for megaprojects
Megaprojects (sometimes also called "major programs") are extremely large-scale investment projects, typically costing more
than US$1 billion per project. Megaprojects include bridges, tunnels, highways, railways, airports, seaports, power plants,
dams, wastewater projects, coastal flood protection schemes, oil and natural gas extraction projects, public buildings,
information technology systems, aerospace projects, and defence systems. Megaprojects have been shown to be particularly
risky in terms of finance, safety, and social and environmental impacts. Risk management is therefore particularly pertinent
for megaprojects and special methods and special education have been developed for such risk management.
Risk management regarding natural disasters
It is important to assess risk in regard to natural disasters like floods, earthquakes, and so on. Outcomes of natural disaster
risk assessment are valuable when considering future repair costs, business interruption losses and other downtime, effects
on the environment, insurance costs, and the proposed costs of reducing the risk. There are regular conferences in Davos to
deal with integral risk management.
Risk management of information technology
Information technology is increasingly pervasive in modern life in every sector.
IT risk is a risk related to information technology. This is a relatively new term due to an increasing awareness that
information security is simply one facet of a multitude of risks that are relevant to IT and the real world processes it supports.
A number of methodologies have been developed to deal with this kind of risk.
ISACA's Risk IT framework ties IT risk to enterprise risk management.
Risk management techniques in petroleum and natural gas
For the offshore oil and gas industry, operational risk management is regulated by the safety case regime in many countries.
Hazard identification and risk assessment tools and techniques are described in the international standard ISO 17776:2000,
and organisations such as the IADC (International Association of Drilling Contractors) publish guidelines for HSE Case
development which are based on the ISO standard. Further, diagrammatic representations of hazardous events are often
expected by governmental regulators as part of risk management in safety case submissions; these are known as bow-tie
diagrams. The technique is also used by organisations and regulators in mining, aviation, health, defence, industrial and
finance.
Risk management as applied to the pharmaceutical sector
The principles and tools for quality risk management are increasingly being applied to different aspects of pharmaceutical
quality systems. These aspects include development, manufacturing, distribution, inspection, and submission/review
processes throughout the lifecycle of drug substances, drug products, biological and biotechnological products (including the
use of raw materials, solvents, excipients, packaging and labeling materials in drug products, biological and biotechnological
products). Risk management is also applied to the assessment of microbiological contamination in relation to pharmaceutical
products and cleanroom manufacturing environments.
Midterm Handouts
Positive Risk Management

Positive Risk Management is an approach that recognizes the importance of the human factor and of individual differences in
propensity for risk taking. It draws from the work of a number of academics and professionals who have expressed concerns
about scientific rigor of the wider risk management debate, or who have made a contribution emphasizing the human
dimension of risk.
Firstly, it recognizes that any object or situation can be rendered hazardous by the involvement of someone with an
inappropriate disposition towards risk; whether too risk taking or too risk averse.
Secondly, it recognizes that risk is an inevitable and ever present element throughout life: from conception through to the
point at the end of life when we finally lose our personal battle with life threatening risk.
Thirdly, it recognizes that every individual has a particular orientation towards risk; while at one extreme people may by
nature be timid, anxious and fearful, others will be adventurous, impulsive and almost oblivious to danger. These differences
are evident in the way we drive our cars, in our diets, in our relationships, in our careers.
Finally, Positive Risk Management recognizes that risk taking is essential to all enterprise, creativity, heroism, education,
scientific advance – in fact to any activity and all the initiatives that have contributed to our evolutionary success and
civilization. It is worth noting how many enjoyable activities involve fear and willingly embrace risk taking.
Within the entire Risk Management literature (and this section of Wikipedia) you will find little or no reference to the human
part of the risk equation other than what might be implied by the term 'compliant'. This illustrates the narrow focus that is a
hall mark of much current risk management practice. This situation arises from the basic premises of traditional risk
management and the practices associated with health and safety within the working environment. There is a basic logic to
the idea that any accident must reflect some kind of oversight or situational predisposition that, if identified, can be rectified.
But, largely due to an almost institutionalised neglect of the human factor, this situationally focused paradigm has grown
tendrils that reach into every corner of modern life and into situations where the unintended negative consequences
threaten to outweigh the benefits.
Positive Risk Management views both risk taking and risk aversion as complementary and of equal value and importance
within the appropriate context. As such, it is seen as complementary to the traditional risk management paradigm. It
introduces a much needed balance to risk management practices and puts greater onus on management skills and decision
making. It is the dynamic approach of the football manager who appreciates the offensive and defensive talents within the
available pool of players. Every organisation has roles better suited to risk takers and roles better suited to the risk averse.
The task of management is to ensure that the right people are placed in each job.
Positive Risk Management relies on the ability to identify individual differences in propensity for risk taking. The science in
this area has been developing rapidly over the past decade within the domain of personality assessment. Once an area of
almost tribal allegiance to different schools of thought, today there is wide spread consensus about the structure of
personality assessment and its status within the framework of the cross disciplinary progress being made in our
understanding of Human Nature. The Five Factor Model (FFM) of personality has been shown to have relevance across many
different cultures, to remain consistent over adult working life and to be significantly heritable. Within this framework there
are many strands which have a clear relationship to risk tolerance and risk taking. For example, Eysenck (1973) reports that
personality influences whether we focus on what might go wrong or on potential benefits; Nicholson et al. (2005) report that
higher extroversion is related to greater risk tolerance; McCrae and Costa (1997) link personality to tolerance of uncertainty,
innovation and willingness to think outside the box; Kowert, 1997) links personality to adventurousness, imagination, the
search for new experiences and actively seeking out risk. Building from these foundations of well validated assessment
practices, more specialized assessments have been developed, including assessment of Risk Type.
Criticisms
However, researchers at the University of Oxford and King's College London found that the notion of complementarity may
be a concept that does not work in practice. In a four-year organizational study of risk management in a leading healthcare
organization, Fischer & Ferlie (2013), found major contradictions between rules-based risk management required by
managers, and ethics-based self-regulation favoured by staff and clients. This produced tensions that led neither to
complementarity nor to hybrid forms, but produced instead a heated and intractable conflict which escalated, resulting in
crisis and organizational collapse.
Midterm Handouts
The graveyard of former greats is littered with examples where the balance of risk went seriously awry; the ENRON and RBS
stories have become iconic references in the pantheon of corporate governance and corporate mortality. Eastman Kodak
might be a nominee for the opposite pole – the corporately risk averse.
Risk management and business continuity

Risk management is simply a practice of systematically selecting cost effective approaches for minimising the effect of threat
realization to the organization. All risks can never be fully avoided or mitigated simply because of financial and practical
limitations. Therefore all organizations have to accept some level of residual risks.
Whereas risk management tends to be preemptive, business continuity planning (BCP) was invented to deal with the
consequences of realised residual risks. The necessity to have BCP in place arises because even very unlikely events will occur
if given enough time. Risk management and BCP are often mistakenly seen as rivals or overlapping practices. In fact these
processes are so tightly tied together that such separation seems artificial. For example, the risk management process creates
important inputs for the BCP (assets, impact assessments, cost estimates etc.). Risk management also proposes applicable
controls for the observed risks. Therefore, risk management covers several areas that are vital for the BCP process. However,
the BCP process goes beyond risk management's preemptive approach and assumes that the disaster will happen at some
point.
Risk communication
Risk communication is a complex cross-disciplinary academic field. Problems for risk communicators involve how to reach the
intended audience, to make the risk comprehensible and relatable to other risks, how to pay appropriate respect to the
audience's values related to the risk, how to predict the audience's response to the communication, etc. A main goal of risk
communication is to improve collective and individual decision making. Risk communication is somewhat related to crisis
communication.
Seven cardinal rules for the practice of risk communication
(as expressed by the U.S. Environmental Protection Agency and several of the field's founders)
 Accept and involve the public/other consumers as legitimate partners (e.g. stakeholders).
 Plan carefully and evaluate your efforts with a focus on your strengths, weaknesses, opportunities, and threats
(SWOT).
 Listen to the stakeholders specific concerns.
 Be honest, frank, and open.
 Coordinate and collaborate with other credible sources.
 Meet the needs of the media.
 Speak clearly and with compassion.

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AR 432A: PROFESSIONAL PRACTICE 3

STANDARD OF PROFESSIONAL PRACTICE (SPP) ON

2.3.9 Building Systems Design

4.2.2 Construction Phase

STANDARD OF PROFESSIONAL PRACTICE (SPP) ON

2.2 Design-Build Services with Guaranteed Maximum Project Construction Cost

STANDARD OF PROFESSIONAL PRACTICE (SPP) ON

4. DRAWING UP THE ADC CONDITIONS

STANDARD OF PROFESSIONAL PRACTICE (SPP) ON

practice between and among RLAs and FAs/FCs;

5.7 Consulting Architectural Firm (CAF)

5.14 Overhead refers to the following:

5.15 Professional Consulting Architect (PCA)

5.16 Professional Organization, Accredited (APO)

5.17 Professional Architectural Consulting Services (PACS)

5.20 Salary Cost

6. SCOPE OF PROFESSIONAL ARCHITECTURAL CONSULTING SERVICES (PACS)

7. QUALIFICATIONS OF PROFESSIONAL CONSULTING ARCHITECTS (PCAs)

8. SELECTION OF PROFESSIONAL CONSULTING ARCHITECTS (PCAs)

9. MANNER OF PROVIDING PROFESSIONAL ARCHITECTURAL CONSULTING SERVICES (PACS)

10. COMPENSATION OF PACS

10.7.4 Fixed/ Lump Sum payment

11. SEAL AND USE OF SEAL UNDER PACS

12. INTELLECTUAL PROPERTY RIGHTS FOR PACS

13. PROFESSIONAL RESPONSIBILITY AND CIVIL LIABILITY FOR PACS

15. ALTERNATIVE DISPUTE RESOLUTION (ADR)

Office Management Basics

American Association of Cost Engineers, now AACE

A. Executive Functions and Leadership

Principles of risk management

Establishing the context

Composite Risk Index

Potential risk treatments

Areas of risk management

Positive Risk Management

Risk management and business continuity

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