Last edited 03 Sep 2020

Approximate quantities cost plan

Cost plans are generally prepared by cost consultants (often quantity surveyors). They evolve through the life of the project, developing in detail and accuracy as more information becomes available about the nature of the design, and then actual prices are provided by contractors and suppliers.

They range from very early initial cost appraisals through to tender pricing documents and the final account:

Initial cost appraisals (studies of options prepared during the feasibility study stage).
Elemental cost plan (prepared during the project brief stage and developed all the way through to detailed design).
Approximate quantities cost plan (from the end of detailed design through to tender).
Pre-tender estimate (prepared alongside tender documentation).
Tender pricing document (strictly speaking this is not a priced document, but is part of the tender documentation issued to the contractor for pricing).
Contract sum (agreed with the contractor during the tender period and adjusted during the construction period).
Contract sum analysis (a break down of the contract sum prepared by the contractor on design and build projects).
Final account (agreed during the defects liability period).

Other than initial cost appraisals, these all relate to the construction cost of the project (rather than wider project costs that the client might incur, which could include; fees, equipment costs, furniture, the cost of moving staff, contracts outside of the main works, and so on). It is important that the client makes clear what costs should be monitored by the cost consultant and what will remain within the control of the client organisation.

The approximate quantities cost plan is a development of the elemental cost plan. Unlike the elemental cost plan in which the cost of elements is broken down from the overall construction cost, based on the experience of the cost consultant and known costs of similar completed projects, the approximate quantities cost plan is a first attempt to measure defined quantities from drawings (or to take them off from a building information model).

It presents a more accurate picture of where costs are distributed, in particular it draws to the attention of designers those elements of the design that are standard and those that are not and as a consequence may be more expensive. In effect it is a priced approximate bill of quantities.

The approximate quantities cost plan should be accompanied by a schedule of assumptions made and perhaps a cash flow projection. A pre-construction whole-life cost plan may also be prepared.

The approximate quantities cost plan should form a solid base for an effective value engineering exercise.

From the point that the approximate quantities cost plan has been approved, cost control procedures can be introduced by treating changes as if they are variations.