Costs Involved in Various Processes of Construction

Part 1
The process of costing projects have been used to track business profitability for a long time.
Businesses use these process to estimate costs, revenue and potential risks of each business
activity. In the construction industry, the costing system is also highly used by many large
projects and medium term rise projects. Here, the estimated costs and the budget stipulated in the
bill of quantities are compared with the actual costs considering the risks involved. This report
will analyze costs involved in various processes of construction of a medium rise project and
analyze the risks involved to enable fine tuning of the operations to generate higher profitability.
Risk assessment
Risks What can happen Risk rating
estimate
Actual costs estimate
Weather risks Rainy seasons where workers
can’t work
20% 120%
Rise of ground water hindering
excavations and compactions
10% 110%
Rain may damage works done
(eg wet paint)
10% 110%
Overhead costs of pumping water
out of construction sites
15% 115%
Time risks Delay in construction works
(delay in arrival of materials)
10% 110%

Cost risks Rise in cost of products 20% 120%
Work quality Deflective work that will require
re work
10% 110%
Double handling 10% 110%
Construction risk Construction delays 10% 110%
Unforeseen construction changes 10% 110%
Technological risk Lack of technologies 10% 110%
Management errors 10% 110%
Schedule of project expenditure
Activity Time Cost estimate in Australian
dollars
(including labor and material)
Site clearance and preparations 1 week 1500
Excavations (cutting material
for sufficient foundation
depths)
3 weeks 25000
Blinding 1 week 6200
Fixing rebar for column bases
and construction of formwork
2 weeks 98400

Casting foundation bases 2 weeks 52200
Backfilling 1 week 5200
Hardcore filling 1 week 6000
Ground floor casting 2 days 7000
Column rebar fixing 1 week 5000
Column casting 1 week 800
Fixing formwork for first floor 2 weeks 500
Fixing rebar for first floor slab 1 week 6000
Casting first floor slab 1 day 7000
Column rebar fixing 1 week 5000
Column casting 1 week 800
Fixing formwork for second
floor
2 weeks 500
Casting second floor 1 day 7000
Column rebar fixing 1 week 5000
Column casting 1 week 800
Masonry wall erection 1 month 90000
Fixing windows and doors 2 weeks 6000
Roof trussing and roofing 1 month 100000