Q/define contract explain diffrent types, adv dis adv

A/ A contract is a mutual or legally binding agreement between

two parties based on policies and conditions recorded in document
form.
The two parties involved are one or more property owners and one
or more contractors.

Types of contracts
1.Lump sum contract
2.Lump sum and schedule contract
3.Schedule contract or Item rate contract
4.Labour contract
5.Cost plus percentage contract
6.Petty Contract

1.) Lump sum contract

Advantages
Low risk for the owner.
Accepted widely as a contracting method.
Contractor will maximize its production and performance.
The contractor will try to complete the project faster.

Disadvantages
It presents higher risk to contractor.
Changes are difficult to quantify.
The construction progress could take longer than other
contracting alternatives.
The project needs to be designed completely before the
commencement of activities.

2.) Lump sum and schedule contract

This is similar to lump sum contract but the schedule of rates is
also provided in the contract agreement.

3.) Schedule contract or item rate contract

Advantages:
There is no risk for the contractor and thus, quality work is
assured.
The contractor is paid as per the actual measurement.
This contract is fair and thus, allows extra items.
Disadvantages:
The owner is not sure of total cost of work till completion of
work.
Both owner and contractor have to appoint staff for taking
measurement and to prepare bill, which is a tedious job.
4.) Labour Contract
Advantages
The owner buys all material by himself so he feels sure of brand
and quality of materials used in the construction.
The owner can save on the amount of profit considered by the
contractor on all material cost but this is tricky and not always
true and sometimes it may prove costlier also
Disadvantages
The owner buys all the materials form the construction hence he
has to manage and plan the fund from the beginning.
The price variation in materials as per market fluctuation affects
the owner.
5.) Cost plus Percentage Contract
Advantages
Construction can start before design is completed.
If contractor is efficient in utilization of resources then the
cost to the client should represent a fair price for the work
undertaken.
Disadvantages
The total project cost is completely unknown before the project
starts

6.) Petty Contract

a contract for a small service or product that involves a
relatively small amount of money and does not require extensive
legal negotiations or documentation could be considered a "petty
contract". These types of contracts may not be subject to the
same level of scrutiny or legal protections as larger, more
complex contracts.

Q/ muster roll
A/ Muster Roll is used for keeping a complete record of
attendance, payment made, unpaid wages, and work done by daily
labor engaged in the execution of works
The Muster Roll consists of two parts: -
PART I - Nominal Roll
Nominal Roll where daily attendance are recorded. In this part
there are column and spaces for the names of the laborer,
designation, father's name, dates of attendances, rates, total
amount due for each, total amount due for whole, signature of the
person taking attendance, signature of the officer making payment,
etc., and these columns are duly filled up. Fines if inflicted on
the laborer is recorded in PART I.
PART II - Details of quantity of work done by the laborer =
Details of quantity of work done by the laborer and the progress
of work are recorded in this part. Details of measurement are
taken and entered in the measurement book and An Abstract of
Quantities is prepared sub-head wise and this is recorded in PART
II of the Muster Roll.

Muster Roll, should not be prepared duplicate. It is permissible

to keep one for laborer employed on several small work in
nearabout places.
Laborer may be paid more than once in a month, but separate
Muster Roll must be prepared for each period of payment.
The daily attendance and absence of laborer and fines, if any,
imposed on them should be recorded in ink daily in the Muster
Roll so that the calculations may be done correctly, and it may
not be possible to temper with the attendance and entries and
classification of cost on works and sub-heads of works may be kept
separately.

Q/ PIECE WORK AGREEMENT

A/ P. W. Agreement is that where only rates are agreed upon
without reference to the total time, and that involves payment of
work done at the stipulated rate.
Small works or piece-work up to Rs. 2,000 may be carried out
through contractors by Piece-Work Agreements.
The P. W. Agreement contains only the descriptions of different
items of works to be done and their rate.
Contractors have to arrange all materials, labor, etc., required
for the execution of the work.
P. W. Agreements, are not contracts in the true sense, and the
department may terminate the work at any time they like but a
notice specifying the date of termination should be served to the
piece worker.
Rates of different items should be within schedule of rates or
within sanctioned estimated rates.
Payment is made on the measurement of the work actually done.
Under special circumstances work up to Rs. 7,500 can also be
executed by P.W.A. by the Executive Engineer.

Q/ Work Order
A/ Small work up to Rs. 2,000.00 can be carried out by Work Order
. It's a contract specifying:
Approximate quantities of work items
Detailed specifications for each item
Time for completion
Penalty for not fulfilling terms and conditions
Payment is made on the measurement of work done
10% of the bill amount is deducted as security money
Amount is refunded on satisfactory completion of work

Q/ Arbitration
A/ The concept of arbitration means resolution
of disputes between the parties at the earliest
point of time without getting into the
procedural technicalities associated with the
functioning of a civil court

Q/ write short note on earnest money deposiT

A/
Earnest money deposit (EMD) is a type of security deposit that is
required to be submitted along with a tender bid. The amount of
EMD is usually a percentage of the total value of the tender. The
purpose of EMD is to ensure that the bidder is serious about
winning the tender and that they will be able to fulfill the terms
of the contract if they are awarded the tender.

EMD is usually refunded to the bidder if they are not awarded the
tender or if they withdraw their bid before the tender closes.
However, if the bidder is awarded the tender and then fails to
fulfill the terms of the contract, the EMD may be forfeited.

EMD is an important part of the tendering process. It helps to

ensure that only serious bidders participate in the tender and
that the winning bidder will be able to fulfill the terms of the
contract.

Here are some of the benefits of EMD:

It helps to ensure that only serious bidders participate in

the tender.
It helps to protect the client from bidders who may not be
able to fulfill the terms of the contract.
It helps to reduce the risk of non-performance by the winning
bidder.
It can help to speed up the tendering process by reducing the
number of bids that need to be evaluated.

If you are planning to submit a tender bid, it is important to

understand the EMD requirements. You should also make sure that
you have the financial resources to cover the EMD in case you are
awarded the tender.
Q/ security deposit in tender
A/ A security deposit is a sum of money that is required to be
submitted along with a tender bid. The amount of security deposit
is usually a percentage of the total value of the tender. The
purpose of a security deposit is to ensure that the bidder is
serious about winning the tender and that they will be able to
fulfill the terms of the contract if they are awarded the tender.

Security deposits are usually refunded to the bidder if they are

not awarded the tender or if they withdraw their bid before the
tender closes. However, if the bidder is awarded the tender and
then fails to fulfill the terms of the contract, the security
deposit may be forfeited.

Security deposits are an important part of the tendering process.

They help to ensure that only serious bidders participate in the
tender and that the winning bidder will be able to fulfill the
terms of the contract.

Q/ Comparative Statement ***

A/ A comparative statement is a financial statement that presents
the financial information of a company for two or more periods
side-by-side. This allows users of the financial statements to
compare the company's financial performance over time.

Comparative statements can be used to identify trends in the

company's operations and financial health. For example, by
comparing the company's income statements from one period to the
next, investors can see whether the company's revenue and
expenses are increasing or decreasing. This information can be
used to assess the company's profitability and financial stability.

Q/ TERMINATION OF CONTRACT
A/ Contract termination is the process of ending a contract
before it is entirely performed per both parties' agreed-upon
terms and conditions. If a written agreement is terminated before
parties perform obligations, the requirement to fulfill these
obligations becomes void. Contract termination must be completed
with care to avoid missed obligations, lawsuits, and other
harmful consequences.

There are many reasons why a contract may be terminated. Some of

the most common reasons include:
 Breach of contract: This occurs when one party fails to fulfill
their obligations under the contract.
Mutual agreement: The parties may agree to terminate the
contract at any time.
Material change in circumstances: This occurs when something
happens that makes it impossible or impractical to fulfill the
contract.
Impossibility of performance: This occurs when something
happens that makes it impossible to perform the contract, such as
the destruction of the subject matter of the contract.
Bankruptcy: If one of the parties files for bankruptcy, the
contract may be terminated.
Death or incapacity: If one of the parties dies or becomes
incapacitated, the contract may be terminated.

When a contract is terminated, the parties are no longer bound by

its terms. This means that they are no longer required to perform
their obligations under the contract and they may no longer
enforce the contract against the other party.

Q/Lump sum contract

A/ In this contract contractor undertakes construction of specific
work with all its contingencies to complete it in all respects
within specified time for a fixed amount.
Detailed specification of all items of works associated with whole
work, plans and detailed diagrams and deposit of 10% security
money, penalty, progress and other conditions are included.
Lump sum contract is typically used in building construction
projects in which quantities are exactly measured.
Suitable for works in which contractors have prior construction
experience.

Q/cash book
A/ CASHBOOK
Cash Book is an important record and should be accurately
maintained on a daily basis in both the Divisional Office and
Sub-Divisional Office.
Receipt side (5 columns on left hand)
Temporary advance is the amount which is advanced by a Disbursing
officer to a
Sub-Ordinate officer.
The amount of temporary advance should be closed as soon as
possible.
An Imprest is also known as Parmanent Imprest.
This can enable the individual to make certain classes of
disbursements
which may been trusted to his charge by the Divisional/Sub-
Divisional
officer.
It must not be more than 1000 without special sanctions.

They can make urgent payments for items such as transport

charges, materials,
etc.
Receipts are recorded in red ink and expenditure items in blue
ink, and every
payment must be supported by a proper voucher.
The Imprest account is submitted to the Divisional officer
regularly, and
payments are made before auditing.
To control and regulate the development of the City.
Also it is the set of rules for the buildings ,under which the
uniform development of locality takes place

Q/RECIPT OF MONEY
A/ When money is received by a Govt. official on behalf of the
Government, it is at
once entered in the account of cash book and a receipt in proper
form (Form 3)
is granted to the payer under the dated signature of Divisional
Officer.
Sources of Receipt Money:
a. Sale proceeds of dead and fallen tress in road side, in canal
land, etc.
b. Sale proceeds of fruit crops of trees and grasses in govt.
land
c. Sale proceeds of unserviceable tool and plants.
d. Sale proceeds of surplus stock.
Sales are usually done by public auction with proper notific

Q/ SHORT NOTE ON VALUATION

A/ Valuation is the process of determining the current worth of
an asset. It is used in a variety of contexts, including
investment, insurance, and taxation. There are many different
methods of valuation, each with its own advantages and
disadvantages.

The three main types of valuation are:

 Market value is the price that an asset would sell for in an
open market. It is determined by supply and demand.
Book value is the value of an asset as it is listed on the
balance sheet. It is determined by the cost of the asset minus
any accumulated depreciation or amortization.
Intrinsic value is the value of an asset based on its future
cash flows. It is determined by discounting future cash flows to
their present value.

Q/ TENDER IN DETAIL
A/ Tender: Tender is an offer in writing to execute a specified
work or to supply some specified articles at certain rates within
fixed time under certain conditions of contract.
Tendering: It refers to the process whereby governments and
financial institutions invite bids for large projects that must be
submitted within a finite deadline.
In general there are 6 types of tenders:-
Open Tender:-
An open tender is the main tendering procedure employed by both
the government and private sector. This tender is open to all
eligible contractors to supply the required goods or services.
And aimed of open tendering is to acquiring goods or services at
the lowest price therefore the contractors are invited by
advertises a tender offer in any local newspaper giving details
and key information about the proposed work. Most of the public
works are carried out through open tender.
Sealed Tender:
Sealed tenders are invited for huge and important projects.
It contain an offer in writing to execute some specified services
or to supply certain specified goods for a certain price, sent in
a sealed envelope.
All sealed tenders received are then opened together at specified
time.
/Limited Tender:
In this type of tender only selected number of contractors are
invited for tendering process, who are the reliable source of
supply therefore the competition amongst the contractors are less
and most of the specified works are carried out through limited
tender.
Single Tender :
In this an invitation is given to only one firm to render a
service by quoting their rates.
If the quoted rates are high, it will be negotiated prior to the
agreement of the contract regarding specification per item, total
cost of project , time of completion and site detail.
Rate Contract Tender:
It is usually adopted for supply of materials, machine and tools
and it specifies the supply at fixed rate during the period of
contract.
Petty Contract Tender:-
It is generally referred in as a one man contractor.
This category of contractors usually consists of one man firms,
sometimes assisted by a limited amount of unskilled workers.
They may be labour contractors, usually consisting of a
businessman subcontracted to carry out specific work, relying
mainly on unskilled casual labour.

Q/ sinking fund
A/ A sinking fund is a fund that is set aside to pay off a debt
or bond. The money in the sinking fund is typically invested in
safe, liquid assets, such as government bonds or money market
funds. When the debt or bond matures, the money in the sinking
fund is used to pay it off.

Sinking funds can be used to reduce the risk of default on a debt

or bond. By setting aside money to pay off the debt or bond in
advance, the issuer of the debt or bond can ensure that it will
have the money to do so when the time comes. This can make the
debt or bond more attractive to investors, as it reduces the risk
of default.

Sinking funds can also be used to save money on interest

payments. By investing the money in the sinking fund in safe,
liquid assets, the issuer of the debt or bond can earn interest
on the money. This can reduce the amount of interest that the
issuer has to pay on the debt or bond.

Q/ CENTER LINE METHOD

A/ Sure, here is a short note on the center line method:

The center line method is a method of estimating the quantity of

materials required for a building project. It is based on the
total center line length of the walls in the building. The center
line length is calculated by measuring the distance from the
center of one wall to the center of the next wall. The total
center line length is then multiplied by the width and height of
the walls to determine the total quantity of materials required.

The center line method is a quick and easy way to estimate the
quantity of materials required for a building project. The center
line method is best used for projects such as small residential
projects.

Here are the steps involved in the center line method:

Measure the distance from the center of one wall to the center
of the next wall.
Add up the measurements for all of the walls in the building.
Multiply the total center line length by the width and height
of the walls.
The result is the total quantity of materials required.

Here are some of the advantages of the center line method:

It is quick and easy to use.

It does not require any special skills or equipment.
It can be used to estimate the quantity of materials for any
type of building project.
Q/arbitration, arbitration act.
A/ PPT 49