Estimated cost never actual; data required

Estimated cost is never the actual cost

Estimated cost is a forecast made before the work. Actual cost is only known when the work ends. They differ because:

• rates of materials, labour and fuel change with time;
• site conditions (soil, water table, access) differ from those assumed, changing quantities;
• design changes, variation orders and extra items appear;
• wastage, productivity and supervision differ from norms;
• unforeseen events (weather, strikes, delays) add cost;
• measurement and approximation errors exist in the estimate.

A contingency of 3 to 5% is added to cover this, but exact equality is not expected.

Data required for estimating

• Drawings: plans, elevations, sections, foundation and structural details, and schedules of doors, windows and finishes. Without complete drawings, quantities cannot be taken out.
• Specifications: the quality of materials and workmanship (for example cement mortar 1:4, M20 concrete, Fe 500 steel), so that the correct rate can be applied.
• Rates: the District Rate (published yearly by the District Rate Fixation Committee), the DUDBC norms for labour and material consumption, and local market rates for items not covered. Rates of materials, labour, transport (lead), and the contractor's overhead and profit are needed.
• Site data: site conditions, soil type, water table, distance of material sources (lead), and access.
• Quantities: the work quantities taken out item by item, using the units of IS 1200 / the Nepal standard methods of measurement.
• Other data: the applicable taxes (VAT 13%), contingency, price-adjustment and the contract conditions.