Page 99 - Civil Engineering Project Management, Fourth Edition

Civil Engineering Project Management
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head office. A materials clerk on site then checks the deliveries against the
supplier’s invoices and against the original order, certifies the invoice and sends
it to head office for payment. This system can only work, of course, if both
head office and the site are in the same country. Overseas, the agent has to
carry out all the work involved, using sub-agents and accountants or other
supporting staff to carry out the work for him.
A quantity surveyor (QS) (or surveyors) may be employed on site to draw up
monthly applications for payments due to the contractor, according to the
measurement of work done as required under an Institution of Civil Engineers
(ICE) bill-of-quantities contract. Alternatively these QSs – as they are widely
called – may be based in head office visiting site monthly. To them the sub-
agents or section engineers submit their monthly measurements and the QSs
then make up the monthly statement, including any claims the contractor makes
for additional payment for extra work done, delays or difficulties encountered
which the contractor considers should be met. However, on small jobs quantity
surveyors are not always employed because civil engineering quantities differ
from building quantities (see Sections 15.4–15.7), so the small contractor may
use his engineer for this task or do it himself.

7.5 Accounting methods

While the agent may have wide authority on site, the large sums of money he
commits his firm to spending must come under the control of the contractor’s
head office. For supply of materials in regular use the system described in
the previous section is used, that is, head office places the contracts for supply
as agreed with the agent and pays the suppliers’ invoices for deliveries as
checked by the agent. In this manner the agent does not have to handle large
payments himself.
But the agent will also need to open a local bank account, into which head
office transfer funds for a variety of cash payments – for fuel for vehicles, a
variety of consumables and for the wages of labour taken on by the agent.
These payments have to be handled by the site accountant and his pay clerk
on site. The paysheets are made up by the pay clerk on the basis of time sheets
sent in to him by the men on site, the section foremen or gangers certifying the
timesheets of men working under them. From time to time an accountant from
head office may visit the site to audit the local paysheets and cash disburse-
ments by the agent.
On overseas projects the large sums of money which have to be expended
locally mean that a fully staffed accountant’s office, under the charge of an
experienced site accountant, will need to be set up.
The monthly returns of local expenditure sent by the agent to head office are
then added to all the payments and charges met by head office and debited to
the job. These will include not only invoices paid for materials delivered to site,
but also all other relevant expenditure, such as salaries of those working on the