Construction Site Operations: Risk Management, AS 4000 Application, Earned Value Analysis, Report, VOWD and Accruals

This article covers various aspects of construction site operations such as risk management plan, application of AS 4000, earned value analysis, monthly report, and estimating VOWD and accruals. It includes a communication management plan and risk management plan for the project, application of AS 4000 clauses, earned value analysis calculations, and a monthly report detailing the status of the project. It also covers the estimation of VOWD and accruals for pipes delivery, laying pipes, and tested pipes.

Construction Site Operations 1
CONSTRUCTION SITE ANALYSIS
Name
Course
Professor’s name
Institution
Location of institution
Date

Construction Site Operations 2
CONSTRUCTION SITE OPERATIONS
Question 1: Project Risk and Communication
Answer 1 (A)
Communication Management Plan:
For any work to progress effectively, there must exist a swift communication channel. This
communication channel must also present detailed and clear information. This will enable
those involved in project management to detect and hindrances to the project and address the
in the most effective way.
Below is a communication management plan for the projects at hand.
Sr.
No
Category Format Objective Distribution Frequen
cy
1.0 Arrival at site Printed papers
posted on
notice boards
and fliers.
a) To convey
the message
of the time
of reporting
at the site.
b) To make
sure
employees
report early.
a) Site
managemen
t team.
b) Client’s
team.
Daily
2.0 Short review
of what was
done on the
previous day
Questionnaires a) To review
previous
day’s aims
and
b) Site
managemen
t team.
Daily

Construction Site Operations 3
ascertain if
the work
was done
well.
c) Client’s
team.
3.0 Assigning
tasks for the
day
Scheduled duty
roaster and oral
assignment.
a) To assign
various roles
to respective
workers
who should
undertake
each role.
Site management
team
Daily
4.0 Viewing
reports of the
progress of the
work.
email a) To compare
the actual
progress of
the work
with how
the work
was
scheduled to
be done.
a) Stakeholder
s
Monthly
5.0 Monthly
meetings
Face to face
talk.
a) To discuss
about the
progress of
the work.
b) To talk
a) Site
managemen
t team.
b) Client’s
team.
Monthly

Construction Site Operations 4
about the
current
status of the
project.
c) To evaluate
necessary
steps to
ensure that
the work
proceeds
swiftly.
b. Risk Management Plan
Sr.
No
Risk
factor
Details Probability Consequences Mitigation
1.0 Weather Adverse
climatic
conditions
that may
not be
favourable
for
working
High a) Spending
more time.
b) Damage at
workplace
a) Undertaking
outdoor
activities first
before the
weather
changes.
b) Using quality
raw materials
for walls
2.0 Objects of The fossils High a) Weak Requesting for more

Construction Site Operations 5
antiquity need to be
dug out
before the
foundation
could be
established
foundation
b) More time
for the
project
machinery and time in
advance.
3.0 Extension
of time
limit
Due to bad
weather,
objects of
antiquity,
and change
in material
used, the
project
may take
more time
Moderate a) Spending
more time
on the
project
Rescheduling activities
to fit a tighter schedule.
Before any construction work begins, strategies must be put in place to facilitate the
process of dealing with risks that may be encountered during work (Runciman, et al., 2006).
The first risk that the contracting firm is likely to encounter is adverse weather conditions.
Based on past weather forecasting reports, the construction process is likely to take about a
month more than the planned time. The first strategy to lay is protecting the site from damage
by the weather. This could be done by doing sufficient plastering of the structures using
quality materials like the right cement. The next step is to perform weather dependent
activities before the time for peril comes. These activities include outdoor constructions.

Construction Site Operations 6
Lastly, when the adverse weather conditions come, weather dependent activities would have
been completed for they were prioritised. Therefore, workers can shift to weather
independent activities like indoor construction (Rojas & Mukherjee, 2006).
The next risk for the project could be obstructions as we lay the foundation. The
ground on which a foundation of a building is established is one of the most important
considerations during construction (Das, 2010). If there is underlying material which is weak
in structure, the objects of antiquity must be excavated first. This challenge will be addressed
by getting more machinery to facilitate the process of excavating the objects.
There also seems to be a risk of exceeding the time limit for the project. Due to the
weather predictions, the project may take more time than expected. This challenge could be
catered for by asking for more time for the project. More time for any project will mean
better work unlike when work is done under pressure and limited time (Akintoye &
MacLeod, 1997).
Question 2: Application of AS 4000
Answer 2 (A)
Performance and payment, under nature of contract states that the contractor must finish all
his WUC fully as stipulated. Then, the principal pays the contractor the lump sum and the
work accepted for the lump sum. Payments for products or items are attained by multiplying
the quality of each item or work carried out under the contract by the rete that the principal
accepted. Sub clause 5.1 dictates that, the sum of the contract must not increase by more than
10% of the original sum. Unless the contractor meets its requirements, he may not claim any
payment or the principal may deprive him of any payment.
SECTION 2 – APPLICATION OF AS 4000

Construction Site Operations 7
Relevant Clauses from AS 4000:
 Clause 2.1: Performance and payment
This clause states that, before any payments are made, the contractor must have fully
completed his WUC.
 Clause 5.8: No payments until security lodged
With incorporation with clause 5.1, it presents limits to which original expenditures should
not exceed. Clause 5.1 also gives requirements that the contractor must meet before receiving
any payment.
Answer 2 (B)
Clause 8.1 dictates that, if there is any form of inconsistency in information or ambiguity, the
superintendent should be informed. We addressed the challenge of ambiguity and informed
the superintendent about the problem through writing him a letter to describe the situation.
The superintendent then carried out a full audit of the documents.
Relevant Clauses from AS 4000:
 Clause 8.1: Discrepancies
This clause outlines the procedure to follow in case of ambiguity or missing files and the
actions that each party should take.
Answer 2(C)
The claim should be based on clause 2.5, adjustment of actual quantities. This is because the
clause states that any additional or less quantities must be catered for if the principal accepted
a lump sum or rate for any item. The greater than or less than limits for the items also apply.

Construction Site Operations 8
Relevant Clauses from AS 4000:
 Clause 2.5: Adjustment for actual quantities
This clause give the upper and lower limits for adjustment of any quantities. It gives a range
of less than or greater than the original amount.
 Clause 36.2: Purposed variations
Under this clause, the superintendent informs my company of any possible changes to be
made. After evaluation of the proposal, my company decides whether to effect the changes or
not.
Answer 2(D)
Since the object of antiquity is not a problem that we could have discerned earlier, we had to
inform the superintendent of the problem. We also requested for additional resources like
money and machinery to do the work. The superintendent agreed to our suggestion and we
got the machinery and progressed with the work.
Answer 2(E)
The first step was to know the right description of the bolts, for example size and type. Then
the price for the bolts is also established. Lastly, the superintendent takes the initiative of
engaging the relevant authorities to change the overall price of the items (Shnookal &
Charrett, 2010).
QUESTION 3: EARNED VALUE ANALYSIS
EV analysis is a technique used to calculate the performance of a project by
monitoring the expenditure, time of completion and the work that has been done. For you
to calculate this, you need to obtain the PV, EV, and AC (Vanhoucke, 2009).

Construction Site Operations 9
a)
1. PV=total of current planned budget
= 50+ 100+ 120+ 120+ 130
=640 AUD
2. AC= Amount spent
= 65+ 160+ 235+ 120+ 130+ 130
= 840 AUD (thousands)
3. EV= 50% of budget at completion
=0.5 of 1290
= 645 AUD (thousands)
4. CPI= earned value divided by actual cost
= 645/840
=0.7679
5. SPI= earned value divide by planned value
= 645/640
= 1.0078
6. SV= EV-PV (Usmani, 2012)
=645-640
=5 AUD (thousands)

Construction Site Operations 10
7. CV= EV-AC
=645-840
=-195 AUD (thousands)
8. BAC= 50+ 100+ 120+ 120+ 120+ 130+ 130+ 130+ 120+ 120+ 100+ 50
= 1160 UAD (thousands)
b)
i) EAC= BAC/CPI
EAC= 1160/0.7679
=1510.61 AUD
ii) EAC = AC + (BAC – EV)
=840+ (1160-645)
=1355 AUD
iii) EAC = AC + (BAC – EV) / (CPI * SPI)
=840+ (1160-645) / (0.1238*0.2)
=1312.601 AUD
QUESTION 4: REPORT
A draft monthly report detailing the status of the project at the end of 6th month
 Project name:

Construction Site Operations 11
 Client:Town of Sunshine
 Sponsor: State Government
 Other stakeholders: Local tennis club, community leader, council member
 Main contractor: (My company) Ltd.
 Construction time of project: 12 months
 Planned budget: 1290 thousands AUD
Project completed at the end of 6th month: 50% of original work.
Current status of the project
On a general scale, the project is running on a higher budget than expected, as
revelled by the CPI value. However, the SPI value, 1.0078, reveals that we are doing well
in terms of the schedule. Below is a monthly summary of how the project has been
running.
On the first month, the planned expenditure was 50000 UAD. However, the amount
was exceeded and the expenditure was 65000. This was due to added costs of claims to
resolve some errors like replacing bolts.
On the second moth, we anticipated to spend 100000 UAD. This budget was also
exceeded and the total expenditure added by 60000 more UAD. This was because of the
necessity to deal with the object of antiquity, which also meant that we spend more
money.
Similarly, the third month’s budget was lower than what was spent. The planned
amount was 120000 UAD. The total expenditure for that month totalled to 235000 UAD.
The major contribution to the over expenditure was the claim to change the design of
seating material.
The fourth month was quite stable because no emergency issue had to be dealt with.
The planned amount was 120000 UAD and the same amount was spent for that month.

Construction Site Operations 12
Though the fifth month dint have extra things to deal with, there was slight over
expenditure. The budget was 120000 UAD whereas the actual expenditure was 130000
UAD, 10000 UAD more than the planned amount.
During the sixth month, our team did a fabulous job of balancing between the
expenditure and the budget. The planned amount was 130000 UAD and that was the same
amount that was spent.
Question 5: Estimating VOWD and Accruals
VOWD = Rate * WH (Fairfield, Whisenant, & Yohn, 2003)
Pipes delivery: 30/100*3000*200= 180000USD
Third month =36000/0.75
=48000 AUDpaid
Forth month=144000/0.80
Forth month= 180000 AUD
Paid by third month=135000*20/100
=27000 AUD
Laying pipes: 20/100*300*120=7200 AUD
Tested pipes: 10/100*3000*30=9000 AUD
Total= 9000+7200+48000+180000= 244000 AUD
b) Accrual
30/100*3000*200/0.8+20/100*3000*120+10/100*3000*30= 306000 AUD

Construction Site Operations 13
References
Akintoye, A., & MacLeod, M. J. (1997). Risk analysis and management in construction.
International journal of project management, 31--38.
Das, B. M. (2010). Principles of foundation engineering. Cengage learning.

Construction Site Operations 14
Fairfield, M., Whisenant, J., & Yohn, T. (2003). Accrued earnings and growth: Implications
for future profitability and market mispricing. The accounting review, 353--371.
Rojas, E. M., & Mukherjee, A. (2006). Multi-agent framework for general-purpose
situational simulations in the construction management domain. Journal of
Computing in Civil Engineering, 165--176.
Runciman, W. B., Williamson, J., Deakin, A., Benveniste, K., Bannon, K., & Hibbert, P.
(2006). An integrated framework for safety, quality and risk management: an
information and incident management system based on a universal patient safety
classification. BMJ Quality \& Safety, 82--90.
Shnookal, T., & Charrett, D. (2010). Standard form contracting; the role for FIDIC contracts
domestically and internationally. Proceedings of the society of construction law
conference Australia, Perth.
Usmani, F. (2012). Schedule Variance (SV) & Cost Variance (CV) in Project Cost
Management. Retrieved from PM study circle:
https://pmstudycircle.com/2012/05/schedule-variance-sv-cost-variance-cv-in-project-
cost-management/
Vanhoucke, M. (2009). Measuring time: Improving project performance using earned value
management. Springer Science \& Business Media.