What is the difference between prime cost sums and provisional sums?

What is the difference between prime cost sums and provisional sums?

Traditionally, a prime cost is limited to the cost of supplying the relevant item, and does not include the cost of any work that relates to it (such as its installation). In contrast, provisional sums include allowances for both the supply item and all related work to be performed by the contractor.

What is the provisional sum?

Provisional sums are generally an allowance or estimate (often described as a “best guess”) included within the contract price of a construction contract for works that are: not sufficiently defined, designed or detailed to allow an accurate determination of its cost at the time the contract is entered; and/or.

What is the difference between contingency and provisional sum?

As nouns the difference between provisional and contingency is that provisional is (philately) a postage stamp issued locally before an official issue is released while contingency is (uncountable) the quality of being contingent, of happening by chance; unpredictability.

What does PC mean in construction?

Principal Contractor
PC – Principal Contractor.

What is a PC item?

A PC item is an amount of money included in a contract sum to purchase a specified item such as tiles, taps, doors or bathroom fittings. An agreed estimated amount is included at contract signing but the specific products are not selected until a later stage.

Why prime cost sum is important?

The Benefits of Prime Cost Sums If selected to be included as a Prime Cost Sum, a specialist is more likely to aid developers in terms of design detailing and possibly even product development that will aid a developer providing as much detail to tenderers and even in planning applications and such like.

How do you calculate the prime cost?

The prime cost equation is equal to the cost of raw materials plus direct labor. Businesses need to calculate the prime cost of each product manufactured to ensure they are generating a profit.

What is prime cost sum in construction contract?

In construction, the term ‘prime cost sum’ (PC sum) is an allowance for the supply of labour, plant and materials to be provided by a contractor or supplier that will be nominated by the client.

Does provisional sum include builders margin?

The price of the PS to the owner is the actual cost price plus the builder’s margin applied to the amount by which the actual cost price exceeds the PS allowance.

What is PC sum and provisional sum?

Types of Provisional Sums Client PC Sums: Where the client provides an amount to be added for works yet to be fully defined and asks the Contractor to add Mark-up. Contractor Provisional Sums: Where the contractor allows an amount for an item of works he has insufficient information to price.

What is CPC and CCC?

CCC = Certificate of Completion and Compliance CPC should be around the same time with VP… meaning that the SO is already satisfy with the site condition and all the supporting documents (surat sokongan) have been obtain in order for submission of Borang E for CF.

What are prime cost and provisional sums?

Prime Cost and Provisional Sums may be used for both supply only and for supply and installation. The following are some examples: Kitchen whitegoods – ovens etc., Hot water service. Damp-proofing courses in existing masonry walls where the extent of the problem is yet to be uncovered or determined.

What is provisional sum in contract law?

A provisional sum is an amount of money included in the contract sum to cover work or materials, or both, the extent of which cannot be specifically detailed when entering a contract.

What happens if the provisional sum is exceeded?

However, in some circumstances, unforeseen events mean that the provisional sum is exceeded, sometimes by a significant amount. This can be added to the contract sum. For example, a building site may seem sandy and clean with minimal siteworks required.

What makes a good prime cost sum?

Prime Cost Sum items need to be carefully thought through and clearly documented. They should be well described and the $ allowances allocated to them should be credible. Ensure that GST, if applicable, is clearly noted (i.e. included or excluded) in the amount specified.