1.3 QS & Terminology

CERTIFICATE COURSE IN QUANTITY
SURVEYING- FOUNDATION LEVEL
UNIT-1: INTRODUCTION –
QUANTITY SURVEYING & TERMINOLOGY
1 CHICAGO INSTITUTE FOR MANAGEMENT TRAINING, UAE

Quantity Surveying & Terminology

A professional working within the construction industry concerned with building costs”
“
Wikipedia.
 In 1971, the Royal Institution of Chartered Surveyors (RICS) published a report titled The
Future Role of the Quantity Surveyor, which defined the work of the quantity surveyor
as:
‘…ensuring that the resources of the construction industry are utilised to the best advantage
of society by providing, inter alia, the financial management for projects and a cost
consultancy service to the client and designer during the whole construction process.’
 QS developed its root in UK during 17th century
 1785--Earliest recorded firm, Henry Cooper and Sons of Reading was established
 1802-A number of Scottish quantity surveyors met to produce the first method of
measurement
 1820--Emerged as a profession, one of the earliest QSs was Sir Henry Arthur Hunt in
Uk
 1858--First recorded use of term “quantity surveyor”
 1881-Royal Institution of Chartered Surveyors (RICS) was set up and is an
independent professional body which regulates property professionals and surveyors
in the UK and worldwide. The RICS provide education and training standards to all
members and protects consumers with strict codes of practice. The motto of the RICS
is “Est modus in rebus” (which translates into English as: “There is measure in all
things”).

Quantity Surveying & Terminology ………….
 1918-A Joint Committee was set up comprising, six surveyors and four
contractors to draw up a comprehensive set of Standard Rules of Measurement
of Building Works.
 1922--Standard Method of Measurement (SMM1) issued by RICS
 1933--Institution of Civil Engineers, London published report on engineering
quantities
 1967- Establishment of a working party to indentify research needs in
construction .
 1976- Civil Engineering Standard Method of Measurement published by Institute
of Civil Engineering, UK
 1985- CESMM2 published
 1988- SMM7 published
 2009- NRM1 (New Rules of Measurement) published by RICS
 2013- NRM2 superseded SMM7
 2015- NRM3 Effected
 BIS IS 1200 Methods of measurement of building and civil engineering works
( 28 Parts )
 Quantity surveyors (sometimes referred to as cost consultants or commercial
managers) provide expert advice on construction costs. They help to ensure that
proposed projects are affordable and offer good value for money, helping the client
and the design team assess and compare different options, and then track
variations, ensuring that costs remain under control as the project
progresses. Quantity surveyors can specialise in a specific aspect of construction
costs, or in a particular type of construction.
 ESSENTIALS IN A GOOD QUANTITY SURVEYOR
The essentials in a good Quantity Surveyor are:
1. An ability to describe clearly, fully precisely the requirements of the Architect and
arrange the bills of quantities so that the builder’s estimator can quickly, easily, and
accurately arrive at the estimated cost of the project.
2. It is important that the Surveyor should be able to write clearly in language that
will not be misunderstood, and must have sound knowledge of building materials
and construction, and of customs prevailing in the industry.
3. The surveyor must be careful and accurate in making calculations, have
systematic and orderly mind and be able to visualise the drawings and details.
4. Requires a detailed knowledge of contractor’s prices, experience of the building
process and an ability to foresee the likely effect of economics trends to give Cost
Analysis.
5. A certain amount of Legal knowledge (i.e. The Law of Contract) to deal with
contracts.

 Traditional quantity surveying activities (circa 1960).

 The intimate knowledge of projects is at the root of the contribution made by
the quantity surveyor to the value of the client’s business through the
provision of the services shown below.
 Single rate approximate estimates
 Cost planning
 Procurement advice
 Measurement and quantification
 Document preparation, especially bills of quantities
 Cost control during construction
 Interim valuations and payments
 Financial statements
 Final account preparation and agreement
 Settlement of contractual claims

 Evolved role
 In response to the potential demise of bills of quantities, quantity surveyors began
exploring new potential roles for their services.
 Procurement, a term not used until the 1980s, became an important area of activity,
largely because of the increasing array of options that were available. Increased
importance and emphasis were also being placed upon design cost planning as a tool
that was effective in meeting the client’s objectives.
 Whole life costing, value management and risk analysis and management were other
tools being used to add value for the client. As buildings became more engineering
services orientated, increased emphasis was being placed on the measurement, costs
and value of such services.
 Quantity surveyors had historically dealt with this work through prime cost and
provisional sums, but in today’s modern buildings to describe the work in this context is
inadequate.
 Other evolved roles have included project and construction management and facilities
management.
 Because of the inherent adversarial nature of the construction industry they are also
involved in contractual disputes and litigation.
 Some QS practices became very nervous about the apparent demise of bills of
quantities. It remains an apparent demise because at the commencement of the twenty-
first century they still represent a significant proportion of work and associated fees for
some quantity surveying firms.
Quantity Surveying & Terminology………….
 The wheel may have turned in some respects since instead of preparing bills for
clients, quantity surveyors are preparing bills for contractors. This was the
practice used during the nineteenth century.
 Also, countries that hitherto had not yet embraced quantity surveying, and the
number of these countries is continuing to decline, were beginning to see the
benefits of schedules of quantities for tendering and contractual administration
purposes.
 The techniques of whole life costing and value management were being actively
pursued by practices and actively supported by academic research.
 Evolved quantity surveying activities (circa 2012).
 Investment appraisal
 Advice on cost limits and budgets
 Whole life costing
 Value management
 Risk analysis
 Insolvency services

 Cost engineering services

 Subcontract administration
 Environmental services measurement and costing
 Technical auditing
 Planning and supervision
 Valuation for insurance purposes
 Project management
 Facilities management
 Administering maintenance programmesAdvice on contractual disputes
 Planning supervisor
 Employers’ agent
 Programme management
 Cost modelling
 Sustainability Advisor

The basis of the quantity surveying fortunes lies in procurement work in
addition to a range of high-end services. Over the last 50 years services
offered by Quantity Surveyors has changed.


 Developing role
 The future development of quantity surveying services is likely to be influenced
by the following important factors:
 Client focus
 Development and application of information and communication technologies
 Research and its dissemination
 Sustainability agenda.
 Client focus
 The construction costs of capital works projects will always be an important
component for clients in their decision to build. These costs will include whole life
costs. There can be only a few clients with the motto of Cheops, the builder of the
Great Pyramid, who said, ‘I don’t care how much it costs or how long it takes!’
 Consultants are sometimes seen as adding excessive costs to projects and
contractors, offering services that are late, of poor quality and of indeterminate
high costs.
 Clients will always be prepared to pay for services that are able to demonstrate a
financial benefit. The basic requirements of clients are shown below. Though
dated it is still relevant.
 Basic requirements of clients (Source: Powell 1998).
 Reduced time scales
 Practical completion must mean total completion, not ´nearly ready´
 Simplified process
 Complete understanding of the procurement process
 Comprehensive service including mechanical and electrical installations
 Excluding the exclusions
 Effective change management
 Solutions not projects
 The client needs of the early part of this century are broadly identified as listed
below – the seven C’s (Source: Powell 1998).
 Choice
 Co-investment and risk taking
 Commitment
 Credibility
 Competence
 Clarity and accountability
 Consistency
 Experience suggests that, whilst improvement amongst the leaders in the
construction industry can be expected to match the best in the world, the
improvement generally will take time and will involve radical changes in culture
and probably its structure.
 Barlow (1996) has suggested some of the examples of best practices that can be
learned from the manufacturing industry sector and, indeed, the key drivers for
changes identified by Rethinking Construction (Egan 1998) were informed by
experiences in other industries, notably manufacturing. It advocates that client’s
needs should be at the very heart of the process
 Focus on customer satisfaction.
Recognise that clients want buildings and support after completion, at the right
price, to the appropriate quality and standards, on time and meeting their
needs.
 Attention to the process as well as the product.
Product design has now become a byword in manufacturing industry, where
the process used has contributed towards increasing the appropriateness of
the product. Research is necessary in the construction industry in process
analysis.

 Concept of total quality approach and attitudes.
The total quality approach should not be confused with total quality management
or quality assurance, which are now widely accepted in the industry. Total quality
programmes are often expensive to implement relying on extensive training to
bring about a shift in culture. It represents a continuous improvement programme.
 Benchmarking.
The practice of benchmarking all of a company's activities against the best
competition or against organisations who are known to be industry leaders is now
commonplace in some quarters .A characteristic of many of these companies is
their willingness to share knowledge with others.
 Team-working and Partnering, including supply chains.
This aims to make every individual feel worthwhile and as such it leads to greater
pride within a company. It aims to harness the intelligence and experience of the
whole workforce. It also extends beyond the individual company to include
consultants, contractors, subcontractors and suppliers. For large clients they are
also often part of the team
 Information technology.
The construction industry must welcome the more widespread use of information
technologies and embrace the current Technology Foresight Initiative.

 Skills, knowledge and understanding
 In 1992, the Royal Institution of Chartered Surveyors published a report titled The Core
Skills and Knowledge Base of the Quantity Surveyor.
 It examined the needs of quantity surveyors in respect of their education, training and
continuing professional development. This reflected the requirements in the context of
increasing changes and uncertainties in the construction industry and, more importantly,
within the profession.
 Since the publication of this report, there have been a number of government and
educational initiatives with regard to the implementation of lifelong learning.
 All subject disciplines have in recent years placed an increasing emphasis on the
development of generic and specialist skills within their respective curricula.
 The RICS report identified a range of skills that the profession would need to continue to
develop if it wished to maintain its role within the construction industry.
 The report identified a knowledge base that includes:
 Construction technology
 Measurement rules and conventions
 Construction economics
 Financial management
 Business administration
 Construction law
 and a skill base that includes:
 Management
 Documentation
 Analysis
 Appraisal
 Quantification
 Synthesis
 Communication.
 Powell (1998) further emphasised the importance of the skills required of the
chartered quantity surveyor of tomorrow. Tomorrow has now already arrived! This
report emphasised the need to:
 Develop a greater understanding of business and business culture
 Develop strong communications and ICT skills
 Challenge authoritatively the contributions of other team members
 Understand that value can be added only by managing and improving the client’s
 customers and employer’s performance
 Develop skills to promote themselves effectively

 See qualifications only as the starting point
 Recognise the need to take action now
 Become champions of finance and good propriety
 The skills of the quantity surveyor that were very important fifty years ago still
remain important but their relative importance has declined to be replaced by
new skills. This is evident across a whole range of industries and professions.
The skills of today will also need to be enhanced as demands continue to evolve
and change in the future.
 In Perera and Pearson’s (2011) study of the changing development needs of
quantity surveyors within a post-recession industry environment that satisfied the
aspirations of industry, professional and academic stakeholders, the industry
participant ranked the quantity surveying competencies as defined in the Quantity
Surveying Pathway document (detailed below). It is notable that quantification
and costing is still highly in demand.

Ranking of quantity surveying competencies (Source: Perera S and Pearson J. 2011).

 Black Book
 The QS and construction standards, otherwise known as the ‘Black Book’, is a
suite of guidance published by the Royal Institution of Chartered Surveyors (
RICS). It sets the technical standards for quantity surveying that RICS members
should adopt.
 Developed by the RICS in consultation with clients, consultants and contractors,
the latest version was launched in 2012 alongside the accompanying
New Rules of Measurement (NRM).
 The Black Book is not published as a single volume, but is a rolling programme
of standalone publications that may ultimately include up to 50 guidance notes.
Described by the RICS as one of the most significant launches in the 30 years,
together they provide a suite of tools that will help the construction industry work
more collaboratively and consistently.
 At its launch, the then chief construction adviser Paul Morrell said, ‘The launch
of the RICS“Black Book” of practice standards is a timely contribution … and
coupled with the NRM they will help to equip the profession with the means to
maintain a high quality of service and advice to its clients through this time of
transformation.’

 It includes guidance on processes such as:
 Acceleration.
 Capital allowances and remediation relief.
 Cash flow forecasting.
 Conflict avoidance and dispute resolution.
 Construction insurance.
 Construction security and performance documents.
 Cost analysis and benchmarking
 Damages for delay to completion.
 Defects / rectification.
 Defining completion on construction work.
 Developing a construction procurement strategy.
 Electronic document management.
 E-tendering.
 Methodology to calculate embodied carbon.
 Retention.
 Termination of contract, corporate recovery and insolvency.
 Valuing change.

 Red Book
 RICS Valuation - Professional Standards (the 'Red Book') contains mandatory

rules, best practice guidance and related commentary for all members
undertaking asset valuations.
 The Red Book is issued by RICS as part of our commitment to promote and
support high standards in valuation delivery worldwide. The publication details
mandatory practices for RICS members undertaking valuation services. It also
offers a useful reference resource for valuation users and other stakeholders.
 The recent edition of the RICS Valuation - Professional Standards January 2014
(Red Book) became effective on 6 January 2014 replacing all previous versions
of the Professional Standards. It is fully compliant with the International Valuation
Standards (IVS), which have also been updated and were effective from January
2014.
 The Red Book is mandatory for RICS members valuing assets - commercial,
residential and other property, as well as land, plant, machinery, and other
business assets. It covers all of the mechanics of valuation, including assembly,
interpretation, and reporting of information, and is applicable for both RICS
regulated and non-regulated firms.


 Definitions and terminology
 All-in labour rate
A compounded rate which includes payments to operatives and the costs which
arise directly from the employment of labour. Variable costs, such as travelling
time or abnormal overtime, are normally excluded.
 All-in material rate
A rate which includes the cost of material delivered to site, waste, unloading,
handling, storage and preparing for use.
 All-in mechanical plant rate
A compounded rate which includes the costs originating from the ownership or
hire of plant together with operating costs.
 Authorised budget (or approved estimate) ( or Cost limit)
means the maximum expenditure that the employer is prepared to make in
relation to the completed building.
 Approved contractors
Those who have demonstrated that they have the expertise, resources, ability
and desire to tender for a proposed project. Selection of such contractors is
normally by pre-selection procedures.
 Attendance
The labour, plant, materials or other facilities provided by the main contractor for
the benefit of the subcontractor and for which the subcontractor normally bears
no cost

 Definitions and terminology
 All-in labour rate
A compounded rate which includes payments to operatives and the costs which
arise directly from the employment of labour. Variable costs, such as travelling
time or abnormal overtime, are normally excluded.
 All-in material rate
A rate which includes the cost of material delivered to site, waste, unloading,
handling, storage and preparing for use.
 All-in mechanical plant rate
A compounded rate which includes the costs originating from the ownership or
hire of plant together with operating costs.
 Authorised budget (or approved estimate) ( or Cost limit)
means the maximum expenditure that the employer is prepared to make in
relation to the completed building.
 Approved contractors
Those who have demonstrated that they have the expertise, resources, ability
and desire to tender for a proposed project. Selection of such contractors is
normally by pre-selection procedures.
 Attendance
The labour, plant, materials or other facilities provided by the main contractor for
the benefit of the subcontractor and for which the subcontractor normally bears
no cost

 Base cost estimate –
means an evolving estimate of known factors without any allowances for risk and
uncertainty, or element of inflation. The base cost estimate is the sum of the
works cost estimate, the project/design team fees estimate and the other
development/project costs estimate.
 Base date of cost data –
means the date on which rates and prices contained within cost analyses or
benchmark analyses are taken as a basis for calculations.
 Bill of quantities (BQ) –
means a list of items giving detailed identifying descriptions and firm quantities of
the work comprised in a contract.
 Brief
The definition of a client’s building requirements.
 Building work (or building works) –
means all components measured and incorporated in group elements 1 to 8 (i.e.
Substructure; Superstructure; Internal finishes; Fittings, furnishings and
equipment; Services; Prefabricated buildings and building units; Work to existing
buildings; and External works).
 Building works estimate –
means the sum of the cost targets for group elements 1 to 8 It excludes
facilitating works estimate, as well as those relating to main contractor’s
preliminaries, main contractor’s overheads, profit/design team fees estimate,
other development/project costs estimate and risk allowances.

 Buildability
The extent to which the design of a building facilitates ease of construction,
subject to the overall requirements for the completed building.
 Component –
means a measured item that forms part of an element or a sub-element. The
quantity of one or more items will be measured and the cost estimated to
ascertain the cost target for an element or a sub-element.
 Construction inflation –
means an allowance included in the order of cost estimate or cost plan for
fluctuations in the basic prices of labour, plant and equipment, and materials
during the period from the date of tender return to the mid-point of the
construction period. See also the definition for tender inflation.
 Consultants
The client’s advisers on design, cost and other matters. Such advisers may
include project managers, architects, engineers, quantity surveyors, accountants,
bankers or other experts relating to the client’s particular needs
 Commissioning
Test running and ‘taking-over’ by the employer
 Credit –
means a refund offered by the contractor to the employer in return for the benefit
oftaking ownership of materials, goods, items, mechanical and electrical plant
and equipment, etc. arising from demolition or strip out works.
 Cost
The term ‘cost’, without qualification, means the estimated cost of the physical
production of work, without an addition for profit or head office overheads. Note:
‘estimated cost’ must not be confused with ‘historical cost’; ‘historical cost’ is the
cost of construction revealed only after the work has been executed.
 Cost breakdown structure (CBS) –
in the context of bill of quantities, represents the financial breakdown of a building
project into cost targets for elements or work packages.
 Cost target –
in the context of bill of quantities, means the total expenditure for an element or
work package.The cost target for each element is likely to be derived from a
number of sub-elements and components.
 Cost checks (cost check or cost checking) –
take place during all design stages and are concerned with comparing current
estimated costs against cost targets previously set for elements or sub-elements
of the building.
 Cost control –
means the process of planning and controlling the costs of building(s).Takes
place throughout complete duration of the construction project.
 Cost records
Records of historical cost and notes of the conditions prevailing when such cost
was incurred.

 Cost plan – ( elemental cost plan )
is the critical breakdown of the cost limit for the building(s) into cost targets for
each element of the building(s). It provides a statement of how the design team
proposes to distribute the available budget among the elements of the building,
and a frame of reference from which to develop the design and maintain cost
control. It also provides both a work breakdown structure (WBS) and a cost
breakdown structure (CBS), which, by codifying, can be used to redistribute work
in elements to construction works packages for the purpose of procurement.
 Cost per functional unit (or functional unit cost) –
is the unit rate which, when multiplied by the number of functional units, gives the
total building works estimate (i.e. works cost estimate less main contractor’s
preliminaries and main contractor’s overheads and profit). The total
recommended cost limit (i.e. cost limit, including inflation) can also be expressed
as a cost per functional unit when reporting costs.
 Cost per m2 of gross internal floor area (or cost/m2 of GIFA) –
is the unit rate which, when multiplied by the gross internal floor area (GIFA),
gives the total building works estimate (i.e.works cost estimate less main
contractor’s preliminaries and main contractor’s overheads and profit). Other cost
estimates that form part of an order of cost estimate or a cost plan should also be
converted to costs/m2 of GIFA when reporting costs to the employer and project
team (i.e. to express cost targets for group elements, elements, sub-elements, as
well as the cost limit).They are also used in cost analyses and benchmarking as
a means of documenting costs of previously completed building projects.

Project Management Fundamentals………….
 Daywork –
means the method of valuing work on the basis of time spent by the contractor’s
workpeople, the materials used and the plant employed.
 Design
Detailed design drawings and specifications or, alternatively, performance
specifications to be prepared/developed.
 Design team –
means architects, engineers and technology specialists responsible for the
conceptual design aspects and their development into drawings, specifications and
instructions required for construction of the building or facility and associated
processes. The design team is a part of the project team.
 Defined provisional sum –
means a sum provided for work which is not completely designed but for which the
following information shall be provided:
– the nature and construction of the work;
– a statement of how and where the work is fixed to the building and what other
work is to be fixed thereto;
– a quantity or quantities that indicate the scope and extent of the work; and
– any specific limitations and the like identified.
 Deflation –
means a downward movement in the average level of prices and or costs (i.e. the
opposite of inflation).

 Director’s adjustment –
means a reduction or addition to the tender price, derived by the contractor’s
estimating team, offered by the director(s) of the contractor.
 Domestic subcontractors
Subcontractors selected and employed by the contractor.
 Down time
The period of time that plant is not operating. This may be due to breakdown,
servicing time or inability to operate due to external factors.
 Element –
means a major part of a group element (e.g. the elements that create group element
3: Internal finishes are 3.1:Wall finishes, 3.2: Floor finishes, and 3.3: Ceiling
finishes).A separate cost target can be established for each element.
 Estimating
The technical process of predicting cost of construction.
 Estimator
A person carrying out the estimating function in a building organisation. Such a
person may be a specialist or may carry out the estimating function in conjunction
with other functions, such as quantity surveying, general management etc.
 Estimate base date –
means the date on which the cost limit (excluding inflation – i.e. the sum of the works
cost estimate, project/design team fees estimate, other development/project costs
estimate and risk allowance estimate) is established as a basis for calculating
inflation, changes or other related variances.
 Element unit quantity (EUQ) – is a unit of measurement that relates solely to the
quantity of the element or sub-element itself (e.g. the area of the external walls, the
area of windows and external doors and the number of internal doors).
 Element unit rate (EUR) – means the total cost of an element divided by the
element unit quantity (EUQ). For example, the EUR for external walls is the total cost
of the external walls divided by EUQ for external walls. EURs include all the cost of
all materials, labour, plant, subcontractor’s preliminaries, subcontractor’s design fees
and subcontractor’s overheads and profit. EURs exclude main contractor’s
preliminaries, main contractor’s overheads and profit and other allowances, such as
project/design team fees, other development/project costs, risk allowances and
inflation.These items are to be assessed separately.
 Elemental method –
is a budget setting technique which considers the major elements of a building and
provides an order of cost estimate based on an elemental breakdown of a building
project.The elemental method can also be used to develop an initial cost model as a
prerequisite to developing an elemental cost plan. The method involves the use of
element unit quantities (EUQ) and element unit rates (EUR).
 Elemental cost analysis (or cost analysis) –
is a full appraisal of costs involved in previously constructed buildings and is aimed

mainly at providing reliable information that will assist in accurately estimating cost of
future buildings. It provides a product-based cost model, providing data on which
initial elemental estimates and elemental cost plans can be based.

 Elemental cost plan (or cost plan) –
is the critical breakdown of the cost limit for the building(s) into cost targets for each
element of the building(s). It provides a statement of how the design team proposes
to distribute the available budget among the elements of the building, and a frame of
reference from which to develop the design and maintain cost control. It also
provides both a work breakdown structure (WBS) and a cost breakdown structure
(CBS), which, by codifying, can be used to redistribute work in elements to
construction works packages for the purpose of procurement.
 Employer –
means the owner and/or the developer of the building; in some cases the ultimate
user. The terms Senior Responsible Owner (SRO) and Project Sponsor are used by
central civil government and the defence sector; being the representatives
empowered to manage the building project and make project specific decisions. For
the purpose of these measurement rules, the term employer shall also mean Senior
Responsible Owner (SRO) or Project Sponsor.
 Enabling works –
means works executed ahead of the main building contract. Enabling works are
employer and/or project team specified works, which might include a mixture of
facilitating works and new building works (e.g. site preparatory works such as major
demolition, removal of contaminated materials, reptile mitigation measures, and soil
stabilisation; together with new sewers, new access road, new drainage, new
retaining walls, and minor new building works).

 Evaluation
Checking and evaluation of tenders, selection of the contractor(s).
 Finalisation
The adjustment of an estimated cost into a tender sum.
 Feasibility
Studies to establish whether the proposed solution is viable.
 Firm price contract
A fixed price contract which does not allow for its prices to be adjusted for
fluctuations.
 Fixed price contract
A price which is agreed and fixed before construction starts. It may or may not be a
firm price contract.
 Fixed charge –
is for work, the cost of which is to be considered independent of duration.
 Fluctuations
The increase or decrease in cost of labour, plant or materials that may occur during
a contract.
 Facilitating works estimate –
means the sum of the cost targets for group element 0 (i.e. Facilitating works). It
excludes the building works estimate, as well as those relating to main contractor’s
preliminaries, main contractor’s overheads, profit/design team fees estimate, other
development/project costs estimate and risk allowances.

 Facilitating works and building works estimate –
means the sum of the cost targets for group elements 0 to 8 (i.e. Facilitating
works; Substructure; Superstructure; Internal finishes; Fittings, furnishings and
equipment; Services; Prefabricated buildings and building units; Work to existing
buildings; and External works). It excludes cost targets relating to main
contractor’s preliminaries and main contractor’s overheads, profit/design team
fees estimate, other development/project costs estimate and risk allowances.
 Formal Cost Plan –
is the elemental cost plan which is reported to the employer on completion of a
specific RIBAWork Stage or OGC Gateway.
 Formal Cost Plan stage –
is the point at which the quantity surveyor/cost manager formally submits an
elemental cost plan to the employer for consideration.The formal cost plan stages
are interlinked with the appropriate RIBAWork Stages and OGC Gateways.
 Functional unit –
means a unit of measurement used to represent the prime use of a building or
part of a building (e.g. per bed space, per house and per m2 of retail area). It also
includes all associated circulation space.
 Functional unit method –
is a rough budget-setting technique which consists of selecting a suitable
standard functional unit of use for the project, and multiplying the projected
number of units by an appropriate cost per functional unit.

 Gang cost
A grouping of labour costs to include principal and supporting labour associated with
a particular trade.
 Gross external area (GEA) –
is the area of a building measured externally (i.e. to the external face of the
perimeter walls) at each floor level.The rules of measurement of gross external floor
area are defined in the latest edition of the RICS Code of Measuring Practice.
 Gross internal floor area (GIFA) (or gross internal area (GIA)) –
is the area of a building measured to the internal face of the perimeter walls at each
floor level.The rules of measurement of gross internal floor area are defined in the
latest edition of the RICS Code of Measuring Practice.
 Group element – .
means the main headings used to describe the facets of an elemental cost plan (i.e.
Substructure; Superstructure; Internal finishes; Fittings, furnishings and equipment;
Services; Complete buildings and building units; Work to existing buildings; External
works; Facilitating works; Main contractor’s preliminaries; Main contractor’s
overheads and profit; Project/design team fees; Other development/project costs;
Risks; and Inflation).
 Head office overheads
The cost of administering a company and providing off-site services. The
apportionment of head office overheads to projects and to the company as a whole
is decided by management as part of management policy.

 ICE
Institution of Civil Engineers
 Inception.
Identification of a project based on need and defined purpose.
 Inflation –
means an upward movement in the average level of prices and or costs (i.e. the
opposite of deflation). It is included as an allowance in the order of cost estimate or
cost plan for fluctuations in the basic prices of labour, plant and equipment and
materials. Refer to definitions for tender inflation and construction inflation.
 Initial studies
Preliminary consideration of possible solutions, alternatives and conceptual designs.
 Implementation
Construction and/or installation of the works.
 JCT SBC
The Standard Form of Building Contract prepared by the Joint Contracts Tribunal;
can be with or without quantities.
 Labour-only subcontractors
Subcontractors whose services are limited to the provision of labour.
 Lump sum contract
A fixed price contract where the contractor has undertaken to be responsible for
executing the whole of the contract work for a stated total sum.

 Management
The carrying out of the function of general management and the responsibility for
making the decision to tender and for adjudicating the tender.
 Mark-up
The sum added to an estimate in respect of head office overheads and profit.
 Material
Material or components.
 Main contractor (or prime contractor) –
means the contractor responsible for the total construction and completion
process of the building project. The term prime contractor is often used to mean
main contractor in central civil government and the defence sector.The term is
used synonymously, irrespective of the contract strategy used (e.g. traditional,
design and build, design and construct, design and manage or management
contracting).
 Main contractor’s overheads and profit –( overheads and profit )
means the main contractor’s costs associated with head office administration
proportioned to each building contract plus the main contractor’s return on capital
investment. Main contractor’s preliminaries exclude costs associated with
subcontractor’s overheads and profit, which are to be included in the unit rates
applied to building works.

 Main contractor’s preliminaries – ( Preliminaries )
are items which cannot be allocated to a specific element, sub-element or
component. Main contractor’s preliminaries include the main contractor’s costs
associated with management and staff, site establishment, temporary services,
security, safety and environmental protection, control and protection, common
user mechanical plant, common user temporary works, the maintenance of site
records, completion and post-completion requirements, cleaning, fees and
charges, sites services and insurances, bonds, guarantees and warranties. Main
contractor’s preliminaries exclude costs associated with subcontractor’s
preliminaries, which are to be included in the unit rates applied to building works.
 Method statement
A statement of the construction methods and resources to be employed in
executing construction work. This statement is normally linked to the tender
programme.
 Net internal area (NIA) –
is the usable area within a building measured to the internal face of the perimeter
walls at each floor level.The rules of measurement of net internal area are
defined in the latest edition of the RICS Code of Measuring Practice.
 Nominated subcontractor/supplier
Available under some contracts where a subcontractor/supplier is selected by the
architect or engineer and not by the contractor.

 OGC Gateway Process –
is a process that examines programmes and projects at key decision-points in
their lifecycle. It looks ahead to provide assurance that the employer can
progress to the next stage. Project reviews are carried under OGC Gateway
reviews 1 to 5. Published by the Office of Government Commerce, ITIL, 2007:
OGC GatewayTM Process Review 0: Strategic assessment
OGC GatewayTM Process Review 1: Business justification
OGC GatewayTM Process Review 2: Delivery strategy
OGC GatewayTM Process Review 3: Investment decision
OGC GatewayTM Process Review 4: Readiness for service
OGC GatewayTM Process Review 5: Operational review and benefits realisation
Typically, a project will undergo three reviews before a commitment to invest,
and two looking at service implementation and confirmation of the operational
benefits.The process is best practice in central civil government, the health
sector, local government and the defence sector. The emphasis of the OGC .
Gateway Process is to examine the business case, which requires an
assessment of the total development cost of the building project.
 OGC Gateways (or OGC Gateway) –
are key decision points within the OGC Gateway
 Option cost –
is an estimate of the cost of alternative design solutions to achieve the
employer’s objectives; so that they can be compared and appraised. Option
costs will be incorporated in the overarching cost report.
 Overheads and profit –
means the contractor’s costs associated with head office administration,
proportioned to each building contact, plus the main contractor’s return on capital
investment.
 Open competition
The method of selecting tenderers and obtaining tenders by a general invitation
to contractors to apply for tender documents. The number of tenderers is not
usually limited and reputation and ability to execute the work satisfactorily are not
always considered.
 Order of cost estimate –
means the determination of possible cost of a building(s) early in design stage in
relation to the employer’s fundamental requirements. This takes place prior to
preparation of a full set of working drawings or bills of quantities and forms the
initial build-up to the cost planning process.
 Other development/project costs –
means costs that are not necessarily directly associated with the cost of
constructing the building, but form part of the total cost of the building project to
the employer (e.g. land acquisition costs, fees for letting agents, marketing costs
and contributions associated with Section 106 Agreements).

 Prequalification
The provision by a contractor of information as part of a preselection process.
 Preselection
The establishment of a list of contractors with suitable experience, resources,
ability and desire to execute a project, bearing in mind the character, size,
location and timing of the project.
 Prime cost (PC)
Under some contracts, prime cost sums are used in bills of quantities and
specifications for work to be carried out by nominated subcontractors or suppliers
of materials and goods. The contractor may also be invited to carry out work
covered by a PC sum in certain instances.
 Project overheads
The cost of administering a project and providing general plant, site staff, facilities
and site-based services and other items not included in all-in rates.
 Project strategy
Choice of implementation strategy and contract type.
 Provisional sum
A sum included in bills of quantities for work anticipated but insufficiently
designed or detailed to permit descriptions and measurement in accordance with
the requirements of the Standard Method of Measurement (SMM).

 Price stability –
is the boundary between inflation and deflation.
 Prime cost sum (PC Sum) –
means a sum of money included in a unit rate to be expended on materials or
goods from suppliers (e.g. supply only ceramic wall tiles at £36.00/m2, supply
only door furniture at £90.00/door or supply only facing bricks at £390.00/1,000).
It is a supply only rate for materials or goods where the precise quality of those
materials and goods are unknown. PC Sums exclude all costs associated with
fixing or installation, all ancillary and sundry materials and goods required for the
fixing or installation of the materials or goods, subcontractor’s design fees,
subcontractor’s preliminaries, subcontractor’s overheads and profit, main
contractor’s design fees, main contractor’s preliminaries and main contractor’s
overheads and profit.
 Project team –
means employer, project manager, quantity surveyor/cost manager, design team
and all other consultants responsible for the delivery of the building project on
time, on cost and to the required performance criteria (design and quality). The
project team will include the main contractor where the main contractor has been
engaged by the employer to provide pre-construction services.

 Post tender estimate –
means a cost estimate carried out after the evaluation of tenders to corroborate
the funds required by the employer to complete the building project.
 Pre-tender estimate –
means a cost estimate prepared immediately before calling tenders for
construction.
 Provisional quantity –
means a quantity which cannot be accurately determined (i.e. an estimate of the
quantity).
 Provisional sum –
means a sum of money set aside to carry out work that cannot be described and
given in quantified items in accordance with the tabulated rules of measurement.
A provisional sum will be identified as either ‘defined’ or ‘undefined’ (see
definitions of ‘Defined provisional sums’ and ‘Undefined’.
 Project/design team fee(s) –
means project team and design team consultants’ fees for pre-construction,
construction and post-construction related services, other consultants’ fees, fees
and charges for intrusive site investigations, specialist support consultants’ fees
and main contractor’s fees for the provision of pre-construction services. See
group element 11: Project/design team fees for an indicative list of project/design
team fees.

 Project/design team fees estimate –
means the total estimated cost of all project/design team fees at the estimate base
date (i.e. excluding tender inflation and construction inflation).
 Residual risk (or retained risk) –
means the risks retained by the employer.
 Retail area –
means the net internal area (NIA).The rules of measurement of the retail area of a
shop are defined in the latest edition of the RICS Code of Measuring Practice.
 RIBA
Royal Institute of British Architects
 RICS
Royal Institute of Chartered Surveyors
 RIBA Outline Plan of Work –
summarises the deliverables required under each RIBA Work Stage.
 RIBA Plan ofWork –
is a model procedure dealing with basic steps in decision making for a medium-
sized building project. The RIBA Plan of Work sets out a logical structure for
buildingprojects, starting with the brief and ending with post-occupancy
evaluation.The procedures identify the responsibilities of the design team at each
stage of the design and contract administration process. Each step is referred to
as a RIBAWork Stage.The full title of the RIBA Plan ofWork is The Architect’s Plan
ofWork, published by RIBA, but it is commonly known and referred to as the RIBA
Plan ofWork in the building construction industry.
 RIBAWork Stage (or RIBAWork Stages) –
means the stage into which the process of designing building projects and
administering building contracts may be divided. Some variations of the RIBA Work
Stages apply for design and build procurement.
 Risk allowance –
means the amount added to the base cost estimate for items that cannot be precisely
predicted to arrive at the cost limit.
 Risk register (or risk log) –
means a schedule of identified risks.
 Risk value –
means an estimate of the cost of the individual risk.
 Select competition
The endeavour to gain a contract against a limited number of competitors by the
submission of a tender.
 Selective tendering
A method of selecting tenderers and obtaining tenders whereby the number of
contractors invited to tender is limited to the inclusion of contractors who are
considered suitable and able to carry out the work. This suitability is usually determined
by preselection procedures.
 Settlement
The finalisation or settlement on a tender sum to be submitted.
 Specification
Design criteria, technical requirements and performance targets to be established.

 Site area –
means the total area of the site within the site title boundaries (or the total area within the
site title boundaries defined by the employer as the site for the building), measured on a
horizontal plane.
 Subcontractor –
means a contractor who undertakes specific work within the building project; known as
specialist, works, trade, work package, and labour only subcontractors.
 Subcontractor’s preliminaries –
are preliminaries that relate specifically to building work which is to be carried out by a
subcontractor. Costs associated with subcontractor’s preliminaries are to be included in
the unit rates applied to sub-elements and individual components.
 Sub-element –
means a part of an element. As with elements, a separate cost target can be established
for each sub-element (e.g. the sub-elements that comprise element 2: Superstructure are
2.1 Frame; 2.2: Upper floors; 2.3: Roof; 2.4: Stairs and ramps; 2.5: External walls;
2.6:Windows and external doors; 2.7: Internal walls and partitions; and 2.8: Internal
doors.
 Standing plant
Plant retained on site which is not working but which the contractor is still liable to
pay for.
 Statutory undertaker –
means organisations, such as water, gas, electricity and telecommunications companies,
that are authorised by statute to construct and operate public utility undertakings.

 Tender
The sum of money, time and other conditions required by the tenderers to carry
out the specified building work.
 Tender documents
Documents submitted for the information of tenderers.
 Tendering
A separate and subsequent commercial function based upon the estimate.
 Tender inflation –
means an allowance included in the order of cost estimate or cost plan for
fluctuations in the basic prices of labour, plant and equipment, and materials
during the period from the estimate base date to the date of tender return. See
also the definition for construction inflation.
 Tender programme
The initial version of the master construction programme prepared during the
tendering period, to enable the main contractor to appreciate the important time
and resource considerations of the project, in terms suitable to the preparation
and submission of his tender.
 Time-related charge –
is for work, the cost of which is to be considered dependent on duration.
 Total development cost –
means the cost limit (including inflation – i.e. the total of the works cost estimate,
the project/design team fees estimate, other development/project costs
estimates, tender inflation and construction inflation) for the building project.

 Tender timetable
The timetable for the preparation of the estimate, all necessary supporting
actions and for the subsequent conversion of the estimate into a tender and
submission, by the date stipulated in the tender documents.
 TPC
Total Project Cost
 Unit rate(s) –
means the monetary rate applied to an element, sub-element or component per
unit of measurement (e.g. cost per m, cost per m2 and cost per m3). The term
also includes costs/m2 of GIFA and cost per functional unit (or functional unit
cost).
 Undefined provisional sum –
means a sum provided for work that is not completely designed, but for which the
information required for a defined provisional sum cannot be provided.
 Works cost estimate –
means the combined total estimated cost of the building works estimate, the main
contractor’s preliminaries and the main contractor’s overheads and profit
prepared using prices current at the time the estimate is prepared (or
updated).The works cost estimate contains no allowance for project/design team
fees, other development/project costs, risk allowances, tender inflation and
construction inflation.

 Work breakdown structure (WBS) –
in the context of bill of quantities, is used to sub-divide a building project into

meaningful elements or work packages.
 Work package contractor –
a specialist contractor who undertakes particular identifiable aspects of work

within the building project; e.g. ground works, cladding, mechanical engineering
services, electrical engineering services, lifts, soft landscape works or labour
only. Depending on the contract strategy, works contractors can be employed
directly by the employer or by the main contractor.
 Work package contract preliminaries –
are preliminaries that relate specifically to the work that is to be carried out by a
work package contractor.
 Working Rule Agreement (WRA)
National Working Rules for the building industry produced by the National Joint
Council for the building industry.

1.3 QS & Terminology

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CERTIFICATE COURSE IN QUANTITY

SURVEYING- FOUNDATION LEVEL

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 Traditional quantity surveying activities (circa 1960).

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 Cost engineering services

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Ranking of quantity surveying competencies (Source: Perera S and Pearson J. 2011).

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 RICS Valuation - Professional Standards (the 'Red Book') contains mandatory

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is a full appraisal of costs involved in previously constructed buildings and is aimed

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in the context of bill of quantities, is used to sub-divide a building project into

a specialist contractor who undertakes particular identifiable aspects of work

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