Case-Based Cost Control Activity: “The Crayford College Build”

Project Summary (Read Before Answering)

You are the Assistant QS on a £12.5 million school project, currently at Week 20 of 45. Spend to date is £6.95 million. Progress is valued at 52%.

Known variations:

Variation RefDescriptionStatusCost Impact
VAR001Change of floor finishes in classroomsApproved£65,000
VAR002Addition of roof-mounted solar panelsPending£120,000
VAR003Removal of external canopy from west sideApproved-£40,000

Emerging risks:

  • £45,000 steel subcontractor claim for delayed access
  • 7% unaccounted inflation on M&E packages
  • Groundworks may result in £80,000 over-excavation claim
  • Potential client change: £150,000 for an outdoor learning garden

Multiple Choice Questions

1. What is the net variation total currently known (approved and pending)?

A) £65,000
B) £185,000
C) £120,000
D) £145,000

Correct Answer: D) £145,000
(£65k + £120k – £40k)

2. What is the best immediate action regarding the steel subcontractor’s £45,000 claim?

A) Add it to the cost forecast without question
B) Reject the claim and advise the subcontractor to absorb the cost
C) Review site records and delay logs to validate entitlement
D) Ask the client to pay it directly

Correct Answer: C) Review site records and delay logs to validate entitlement

3. What is the current project performance against budget based on spend and progress?

A) On track – spend and progress are well-aligned
B) Slightly overspent – spend is ahead of progress
C) Underspent – progress is faster than spend
D) Impossible to tell

Correct Answer: B) Slightly overspent – spend is £6.95m vs 52% of £12.5m (£6.5m)

4. What cost control measure is most appropriate for managing the M&E inflation risk?

A) Do nothing until invoices arrive
B) Add a provisional sum to the final account
C) Include a forecast allowance in cost reports based on indexed data
D) Cancel the M&E package and re-tender it

Correct Answer: C) Include a forecast allowance in cost reports based on indexed data

5. What should you do with the proposed £150,000 outdoor learning garden?

A) Add it to the cost plan immediately
B) Reject the idea due to current budget pressure
C) Request a formal instruction and price it as a variation
D) Include it in preliminaries as a contingency item

Correct Answer: C) Request a formal instruction and price it as a variation

6. Which of the following is a proactive cost control strategy?

A) Waiting for contractor applications to identify overspends
B) Issuing frequent cost reports and forecasts
C) Delaying reporting until the final account
D) Letting the site manager handle all cost decisions

Correct Answer: B) Issuing frequent cost reports and forecasts

7. Which tool or method would be most useful to visualise live project spend vs budget?

A) Site diary
B) PowerPoint presentation
C) Excel forecast chart or BI dashboard
D) Weekly site photos

Correct Answer: C) Excel forecast chart or BI dashboard

8. What’s the most effective way to reduce the cost of the proposed garden if needed?

A) Suggest removing all planting
B) Propose value engineering, such as cheaper materials
C) Reclassify it as part of external works
D) Leave it out of the report

Correct Answer: B) Propose value engineering, such as cheaper materials

9. If the contractor doesn’t formally notify the over-excavation issue, what risk arises?

A) You can’t issue payments anymore
B) The claim may not be valid under contract terms
C) The client has to automatically accept the cost
D) You must report it to the Health & Safety Executive

Correct Answer: B) The claim may not be valid under contract terms

10. What cost control principle does tracking both actuals and forecasts demonstrate?

A) Legal compliance
B) Ethical practice
C) Proactive management
D) Crisis mitigation

Correct Answer: C) Proactive management