Financial Management & Cash Flow
Management of money movement through a construction business, including calculating cash inflows, outflows, and net cash flow,. addresses issues like retention, interim payments, and fluctuations in costs,,.
Abatement
The process of reducing a price or value, or the interruption of legal proceedings.
Appropriation of Payments
Setting apart money for a specific purpose out of a larger sum.
Back Charges
Costs billed to a subcontractor or supplier when the main contractor has to correct or complete their work.
Cash Flow
The movement of money through a construction business, being the total of incoming payments against outgoing expenses.
Cost Breakdown Structure (CBS)
The financial breakdown of a building project into cost targets for elements or work packages.
Credit
A refund offered by the contractor to the employer in return for taking ownership of materials arising from demolition or strip out works.
Direct Loss and/or Expense
Reimbursement to which the contractor is entitled for disruption and prolongation under contract claims provisions.
Director's Adjustment
A reduction or addition to the tender price, derived by the contractor’s estimating team, offered by the director(s) of the contractor.
Ex Gratia Payment
A payment made as a matter of grace, where the payer is under no legal obligation to make it.
Interest
The rate determined by the Minister of Finance or Justice used to calculate simple interest on debts.
Mobilization Costs
Expenses incurred in setting up the construction site and getting it ready for work.
Net Present Value (NPV)
A method used to assess the profitability of a project by considering the present value of future costs and revenues.
Post-tender Estimate
A cost estimate carried out after the evaluation of tenders to corroborate the funds required by the employer to complete the building project.
Progress Claim
A request for payment made by the contractor showing how much work has been completed and the costs incurred.
Retention
A portion of payment held back by the client until the project is completed and defects are rectified.
Set-off
A defence used to reduce or extinguish a claim by balancing it against a sum owed to the defendant.