Internal Controls at Construction Site

Internal Controls at Construction Site
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1. 1. Internal Controls at the Construction Site 7th Jan, 2012, Hotel Inder
Residency, Ellisbridge, AhmedabadFrom To Topic10.00 am 10.25 am
Registration and Breakfast10.25 am 10.30 am MOC Overview and
Relevance of Internal Controls at the Construction Site and Role of a
Project Manager Statutory Compliances required at the10.30 am 12.00 am
Construction Site under Labour Laws / VAT Laws / Other local
requirements Control Points for Various Equipments like Transit Miller /
Batching Plant / Concrete Pump / Crane / Excavator Understanding of
Material & Labour Procurement Related12.15 pm 1.30 pm Controls
required at the Construction Site01.30 pm 02.00 am Lunch HR Related
Controls - Labour Colony / Mess / Attendance / Vehicle Management
Stores Related Controls - Material Issue / Receipt /02.00 pm 03.30 pm
Reconciliation Methods / Physical Verification Plan03.30 pm 03.45 pm Tea
Break Basics of MIS Preparation for various Departments - Engineering /
Stores / Accounts / HR / Safety Role of Site Accounts and Co-ordination
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with Head Office03.45 pm 05.15 pm info@consultconstruction.com

www.consultconstruction.com
2. Overview and Relevance of Internal Controls at the Construction Site
and Role of a Project Manager Tendering Budgeting Site Mobilisation
Role of a Project Manager Role of a Billing Engineer Material
Reconciliation Project Completion Release of Retention Money
info@consultconstruction.com www.consultconstruction.com
3. [Tendering]info@consultconstruction.comwww.consultconstruction.com
4. Lets see how to approach the jobOf :- Study of Tender Terms Planning
Budgets, Funds, Project Timeline through PERT, CPM Lining up various
functions Engineering Stores HR Accounts Safety and Quality
5. Understanding the conditions of the tenderS. Details sought for CatchN1
Work order Value? Qty Variation not more than 25-30%. Incentive / Penalty
(0.5-5%)Clause.1a Physical visit of the work locations Material Rates /
Terrain for Equipments / Labour colony area / Distance from city.2 FIM RMC / Cement / Steel? Wastage Norms, Debit Rates, Location of Client
Stores (From Loading / Unloading perspective)3 Work completion period
Subject to drawings, front, resources4 Facilities from the Client - Labour
colony, Land, Power & Free or Chargeable. Single / Multiple point Water
supply. at site / At Labour Colony Mobilisation Advance and Time Limit %
given and recovery rate5 Adhoc Payment against uncertified bills (75%)
and Strict committment from client status of remaining bill.6 Check whether
any prescribed format for client bill? Compliance with local laws7 Whether
the job is new or left over one? Investigation required if its a left over job
Impact of Margins8 Safety / Quality Norms info@consultconstruction.com
on Time and Money Impact Formatting system of FQP
6. Cont...S.N Details sought for Catch9 What are the requirements with
each RA bill? Third Party Physical Certification Reconciliation Statement of
FIM10 What are the rates of principal items (like Higher Margin in items to
be executed Excavation, RMC supply, Shuttering etc.) first Apart from FIM,
what are other items are kept in client scope (e.g. False Ceiling, Roofing,
Aluminium Doors and Windows)11 What deductions shall be made by
client from Only those agreed as per WO RA bill12 Service tax / VAT /
WCT extra or inclusive? Exemptions Paper Work13 Whether running
plant expansion or If in running plant Scarce area / construction of new
plant building? Pollution Impact on Labour.15 Internal Logistics Location Porta Cabin / Client office / Labour Colony / Batching Plant / Store16 Bank
Guarantee Amt / Performance / Time Validity17 Always cry in front of the
client, dont give any inputs about high margin items18 Statutory
Compliance Insurance / PF / CAR - Whos scope?So proper Site
Investigation Reports needs to be prepared at Tender Stage
7. 7. You have received a tender from theClient / consultant M/s XYZ for
makinga 500 MW Thermal Power Plant in Gujarat.
8. 8. [Budgeting]info@consultconstruction.comwww.consultconstruction.com
9. 9. Lets now come back to Planning info@consultconstruction.com
10.
10. info@consultconstruction.comwww.consultconstruction.com
11.
11. Cost Oriented Planning Convincing the EIC to prepare the
Budgets is the biggest task. Because the forces are so dynamic, actual
scenario is expected to be different from the work orders, hence he is not
in a position to do so. Most of the times he would argue that because of
delay in submission of drawings by the client, planning is not very easy. But
to meet the Project Deadline / it is in the best interests of the client to break
the work order quantities into monthly quantities. Further an overall cap is
required to be kept on the total quantities to be consumed for the project.
Monthly requirements can then be prepared on the basis of monthly
budgets. info@consultconstruction.com www.consultconstruction.com
12.
12. Congrats! You have got a work order from M/s XYZ Cement &
Steel in the state of shall be FIM Gujarat. You have tomobilise 500 Value of
thelabourers in job is20 Days from Rs.100cr today. Time deadline is 15
Months info@consultconstruction.com www.consultconstruction.com
13.
13. Manual for Compliance Verification Whenever a new site is
about to begin:- info@consultconstruction.com
14.
14. Budgeting Lets see a sample budget
15.
15. Different types of contracts Item rate Lumpsum contract
Cost-plus contract Turnkey contract engineering, inspections, erection,
electrical. info@consultconstruction.com www.consultconstruction.com
16.
16. [Mobilisation and Role of Engg Dept]
17.
17. Mobilisation Checklist Statutory registration numbers / Good
Local consultants Resource Mobilisation Equipments JCB & Loader,
Batching plant capacity, Miller, Crane, etc. Vehicles Staff Bus, Sumo,
Utility, Trailer, Tractor & Dumper, Bike etc. IT
Computers/Printer/Scanner/Copier/Internet/Telecom Network Functional
Heads PM / Store / HR / Accounts Office Stationery Reports /
Registers / Blank Slips From client Power / FIM / Drawings / Work
Front Staff Accomodation / Mess / Guest House Onsite office set up
Lining up the labour Logistics Movement to site from various locations
Local Survey Materials and Services info@consultconstruction.com
18.
18. Labour mobilisation Issues Special Points to be kept in mind for
labour mobilisation Areas where labour is available Initial cost of
mobilisation Stay Arrangements Facilities offered by competitors
Watch for the sudden movement of labour info@consultconstruction.com
19.
19. The site is now mobilised and you have to commence the work.
20.
20. Role of Project Manager Work Planning Daily / Weekly /
Monthly: When we plan for work we need to keep in mind client priority,
availability of resources, availability of drawing & front, weather, Funds
etc. Pre planning for FIM / Own Material: Pre planning (system and
procedure) is required for FIM and Own material so as to make it available
in time. Complete responsibility to ensure compliance of the functions by
all the Dept.: Engineering, HR & Admin, Stores, Accounts Sub Contractor
Work Order: Sub Contractor work order should be prepared on time with
their acceptance. Timely submission of bills with due verification from
QSD at HO, if any . If delay reasons need to be submitted to HO.

Subcontractor bills are prepared in due time and are paid after pre-audit at
HO. info@consultconstruction.com www.consultconstruction.com
21.
21. Role of Project Manager cont Understanding of Site
Performance both in terms of actual execution and profitability and
submitting regular MIS to head office. Ensuring proper back up in case if
any employee leaves the organization. Weekly meetings with the Core
team and ensuring due preparation of minutes for mailing the same to
Head office. Checking all the records fortnightly viz. stores inflow,
outflow, vehicle logbooks, and HR records. To focus on all areas where
chances of cost overrun exist by ensuring regular monitoring. Maintaining
employee morale under all situations. info@consultconstruction.com
22.
22. Reconciliation FIM & Principal Material Standard Consumption
norms to be defined for every item in the WO. For e.g. For 1 CUM of M20
- concrete production Cement 140 Kg, Sand 875 Kgs, Agg 1100
Kgs Physical verification of Steel, Sand and Aggregate on the same day
on which reco is prepared. Material scattered at various locations
Consumption for unbilled extra items to be excluded. Stock records to be
updated regularly. Shuttering Repetitions. If material consumption levels
are found in excess of standards appropriate action needs to be taken for
further control and identification of sub-contractor responsible for the same
to enforce timely recovery. info@consultconstruction.com
23.
23. Materials Usage Standard Theoretical Qty * (1 + Normal
Wastage Norms) Qty is derived from design and drawings Normal
Wastage Norms also change from Project to Project depending on nature
of work, method of application However Wastage from following is not a
normal wastage Using Non-Standard Material Excess Purchase
Wastage in Transportation Improper Storage
24.
24. Billing EngineerA. Client & Sub Contractor billing and
Certification: Same Billing period for both client & sub contractor Match
the Quantities Facilitate preparation of MIS Identification of Extra Items
DPR should be generated. RA bill preparation on Time as any delay

Affects Fund management MIS info@consultconstruction.com
25.
25. Sub Contractor Work Order:Sub Contractor work orders should
be prepared: - Item code and language should as per client work order Project Manager and Project commercial head / Project Director approval
signs or mail required.For example:Item As per Item description UOM
RateCode1234 Client Providing reinforcement including cutting, MT 4500
bending, binding, fixing in position including the cost of channels, bars
(Binding Wire is in your scope)FIM or Raw Material shall be provided to
contractor for work by Company:1234-A Contractor Reinforcement Cutting
MT 7001234-B Contractor Reinforcement Bending MT 8001234-C
Contractor Reinforcement Fixing MT 1200 Contractor Total Rate of item
code-1234 is ----> MT 2700 info@consultconstruction.com
26.
26. Engineering MIS info@consultconstruction.com
27.
27. [Project Completion] info@consultconstruction.com
28.
28. Project Completion Checklist for Project Completion Final bill
preparation and certification FIM and Raw Material Reconciliation with
bill and balance qty. Fulfillment of client work completion procedure
Receivable & Liability status & Clearance Statutory compliances
Demobilization Delayed in project completion Work completion
certificate info@consultconstruction.com www.consultconstruction.com
29.
29. Project Completion cont.Final bill preparation and
certification: Cumulative Executed Quantity. All pending extra item
claims should be included, if pending. Necessary follow up for W.O
amendment if Actual Qty > WO Qty. Release of Qty on Hold for want of
various reasons. Fight for the incentive clause. If any company asset is
given on rental / hire basis to other party as per instruction from client, the
same should be claimed in final bill . If resources like equipment /
manpower have remained ideal due to non availability of front, it should be
claimed in the final bill. NOC shall have to be obtained from various
departments of the client info@consultconstruction.com

30.
30. Project Completion cont.FIM and Raw Material
Reconciliation with bill and balance qty.:Formula: Total Material Inward
Less: Material Returned / Transferred Less: Standard Consumption =
Balance Quantity at Site / Store In case this quantity is not available at site
/ store, there are following possibilities: Excess consumption as
compared to standard Theft / Pilferage during the project In case of
excess consumption, some portion can be recovered from measurement
contractor if not recovered till date. Proper justifications are required from
project manager and appropriate action should be taken in case of
abnormal difference between actual balance and standard balance
Balance FIM material started to returning and take its documents with
receiving sign and stamp from client. info@consultconstruction.com
31.
31. Project Completion cont. Fulfillment of client work completion
procedure: In case of project completion client have checklist for same so
you have to ask same from client and compile each point. Receivable &
Liability Status & Clearance: Get status of project liability with break up of
nature of creditor and special remark for local creditors. Follow up for
payment receivable from client after bill certification Clear local liabilities
to avoid any demobilization harassment from them. Statutory compliance:
Follow up and get pending WCT & TDS receivable certificates from client.
Give all necessary details for VAT return filing to local sales tax
consultant and other details, if any required for audit. Get any pending
forms like C & F from the department, also reconcile with the forms issued
till date. Clear o/s local pending liabilities like Road tax, Entry Tax,
Employee Professional Tax etc. info@consultconstruction.com
32.
32. Reasons for Delay in preparation of Final RA BillS. N. Points
Corrective Action1 Non updation of FIM data with stores. Physical
verification of FIM with stores records2 Reconciliation of FIM Required with
each RA Bill3 Work order Amendment Little foresightedness Strong
Followup4 Change in Project Manager / Billing Engg. Documentation-
JMR/BBS/Stores Good Back up at HO Handing over Checklist5 Proper

compilation of Hard and soft copies of all the Data Control and Regular
Audit Running Bills6 Insistence to satisfy requirements of Labour Inspector
Clarity in Work Order Terms If you are under EPC7 Quality compliance
after defect liability You should argue that it is client responsibility8 Idling
Claims depending on locations like Orissa / Record / Emails to client on
regular basis Kerela - Local problems9 Direct Payments by the client
Documentary Evidence info@consultconstruction.com
33.
33. Project Completion cont. Work completion certificate: Dont
forget to collect the work completion certificate from the client
Demobilization: Dehire all types of equipment and machinery. Make
proper plan for shifting of own material to other sites / Central Stores.
Proper plan to shift staff. Dehire idle camp / mess and do not forget to
recover the rent deposit or set off deposit against rent. Check, get and
release Bank Guarantee from client after defect liability period is over
Planning - Lalu info@consultconstruction.com
34.
34. Release of Retention Money Checklist compliance
Certification of Final bill Completion of work upto Defect liability period
No local liability Site and area clearance Return of all FIM Premature
Release Against Bank Gaurantee Till Defect Liability
35.
35. Commercial Procurementi) Goods and ii) Services.
36.
36. Normally in a manufacturing set up we divide the material as :-a.
Repetitive Items Raw Materials Storesb. Non Repetitive Items
Capital Goods Major Repairs Primary purpose of classification is to
Control:- - Quality - Cost - Timely Supply But how do we classify in the
construction sector ? info@consultconstruction.com
37.
37. The most comonly used classification is ABC Analysis.But
prerequisite is that the project should have a standardized bill of
materialslisting the physical quantities, unit rate and total cost for each
item.1. Identify the material required for the Project2. Determine Usage
Value by multiplying the Qty required and its Unit rate.3. Calculate the
percentage usage value with respect to the total material cost for the
project.4. Arrange the Items in descending order of usage value5. Give
Red Colour till 70% and thereafter Green Colour till 90%.6. Mark A class
for Red Coloured Items / B Class for Green Colour and C Class for the
balance.Lets see a small excel sheet on this.
38.
38. Use of ABC to Develop Policy GuidelinesPolicy A B
CConsiderationDegree of Control Strict Moderate LooseForecast
Accuracy Accurate Approximate RoughAuthority of Senior Level Middle
Level At SiteOrderingPurchasesSuppliers to be Maximum 3 to 5 Reliable 2
to 3 Localcontacted suppliersSafety Stock Low Moderate AdequateOrder
Frequency When Required EOQ BulkFollow up Maximum Moderate When
NeccesaryMonitoring Weekly Monthly May not beMaterial
requiredMovementMIS Reports Weekly Monthly Random
39.
39. Inventory Planning The construction material Inventory Plan
aims at evolving materials stock-holding levels to meet project execution
plan, with minimum investment on inventory. In typical project from
Inventory point of view , we may classify the materials as follows:info@consultconstruction.com www.consultconstruction.com
40.
40. Take the case of stocking of cement at the site :- Site
Requirement 500 Bags / Month for 12 Months Order Cost Rs. 500
per order Carrying Cost 10% of unit rate Transport Capacity 100
Bags Lead Time 5 Days Safety Stock 100 Bags Material Life 2
Months Unit Rate - Rs. 250 per bag info@consultconstruction.com
41.
41. EOQ 1 / Unit Rate * {Square Root of (2*Order Cost*Unit
Rate*Site Requirement/Inventory Carrying Cost)} 1/250 * {Square root of
(2*500*250*6000/0.1)} = 500 Bags info@consultconstruction.com
42.
42. Reorder Level = Minimum Stock + (Lead Time * Daily Usage)
100 + (5 * 20) 200 Bags info@consultconstruction.com
43.
43. Commercial Procurementi) Goods cont Goods: Define a
Purchase Policy Purchases to be sourced by Head office. Purchases
to be sourced locally with approval from Head office. Purchases to be
sourced locally with the approval from Project Manager. Material required
for Project: Project Manager to calculate total project material
requirement through Bill of Quantity (BOQ). This would be categorized
as FIM , Raw / Principle Material, Consumable / Hardware / Tools Material,
Capital goods - Plant / Machinery / Equipment Monthly Requirement
44.
44. Commercial Procurementi) Goods cont Placement of Order
(PO): - Purchase order being the last document of procurement process,
so it is necessary to take care before placing the order. Certain details
which need to be mentioned Serially numbered Time & Place of
Delivery Material Quality Description and specifications UOM
Manufacturing date should be latest and not more than two months in case
of certain items like Conplast / Admixture (To get maximum time of its
utilization) info@consultconstruction.com www.consultconstruction.com
45.
45. Commercial Procurementi) Goods cont Materials Indents:
Authorized person should be allowed to raise an indent. The status about
present level of stock should also be given. Market Survey / Enquiry /
Quotation: Relevant journals, yellow pages, market directories etc.
Company can ask quotation / price list with detailed terms and conditions
with its validity from various vendors. Purchase department can take
right decision after comparison and analysis of rate, quality, terms &
conditions with price escalation terms and service condition
46.
46. Stores Related Controls - Material Issue /Receipt / Reconciliation
Methods / Physical Verification Plan At a Construction Site
47.
47. Store Team with Experience Store manpower depends on size
of project, volume of material and stock movement and logistics. For a
small site following if the ideal team Store Incharge 1 = Master Degree /
Specialization of store course and 5 years work Experience Store
Assistant 2 = B. Com / 12th passed and 2years work Experience (Material
Chaser) Data Entry 1 = Bachelor / Certified Computer Course degree
and 2 years work Experience Helpers 5 = Material loading & Un loading,
Cleaning & maintenance Computer literate with basic knowledge of
identification of item, UOM & inward / outward procedures
48.
48. Well Defined work Area Store personnel at Site should not be
used for other works like Sourcing of Vendor Market survey Creditor
payment Any other site functions like HR / Admin activity / Cash Mgmt /
Taking measurements info@consultconstruction.com
49.
49. Store Cycle info@consultconstruction.com
50.
50. Stores Premises Stores Premises GI Sheets / PCC Structure
properly covered Door and Window for Lights & Ventilation House
keeping (cleanliness) Fire extinguisher Rack for stacking of material
Weight machine (Capacity least 100kg) Power connection Computer
system with Printer & UPS Security guards at various points of store
locations across the site info@consultconstruction.com
51.
51. Setup of Stores It is suitable for proper control and supervision
that stores should be near to Batching plant, Steel Yard, Contractor
office Client store for best logistics Store Location should have adequate
space to facilitate material storage and physical verification. Also open
space near stores is required to park Equipments and Vehicles (JCB, TM,
Tractor, etc.) info@consultconstruction.com www.consultconstruction.com
52.
52. Stacking & Labeling Stacking of Material: - - Material not to be
kept directly on ground (1ft above surface) - Rain - Liquid Items should be
tightly covered in order to avoid wastage - Cement / Wooden Items need to
be covered by Tarpoline for safety against rains - Arrangement on the basis
of frequency of usage and in order of priority - Single item to be put at
single place instead of multiple locations - Easily countable (Proper policy
for Bulk Items) Safety to be ensured:- - Heavy material on surface / lower

height & light weighted material in rack Label should be affixed on rack on
each items with Material code (Additionally item description would be
preferable) info@consultconstruction.com www.consultconstruction.com
53.
53. Inventory Level & Local Procurement Inventory minimum and
maximum level should be defined as per monthly Budget quantity, mainly
for A Class Items. Store not to procure the material under normal cases .
All local procurement department after approval from HO and as per
defined policy. info@consultconstruction.com
54.
54. Relationship with supplier Mgmt to ensure and check from time
to time the relationship of store personnel with supplier If Frequent
visits to supplier premises Material Inwards to be checked by Site
Engineer on Surprise basis Material Receipt in day time Quantity
should not be left blank in supplier challan
info@consultconstruction.comNon-Shrink www.consultconstruction.com
55.
55. Security Agency / Guard Stores should be backed by security
personnel Deployment of Guards as per requirement with proper uniform,
stick, whistle & torch at store in two shifts. Duty register / Card duly
signed by store Incharge Incident register (In case of theft) Surprised
visit should be carried out by HR incharge, specially during night
Surprised visit report required with monthly bill of external agency.
56.
56. Material Inward I) FIM Material Inward A) Steel : Challan
should have our indent number / date / quantity with weight slip. Weight
should be carried out at the time of material unloading. Qty should
always be mentioned as per dia and as per no.s and it should be kept dia
wise in steel yard. Dia wise steel record and no.s measurement will also
help in cross verification of weight as per defined ISI standard Dia wise
record will facilitate FIM reco Client should inform about the dispatch of
FIM in advance info@consultconstruction.com
57.
57. Material Inward Continue.. B) Cement : (FIM Material) Inward
should be on weight and challan also have quantity in numbers of bag.
Weight should be carried out at the time of unloading (Powder form). This
net weight quantity should be mentioned as received with mention of
damaged bags in challan and the same should be conveyed to client /
supplier store. Also in case of rain/fog, if material is received without
proper cover, the fact needs to be mentioned on the challan Store should
verify no. of cement bags and ensure proper stacking at time of unloading
itself. Control on Empty bags is required info@consultconstruction.com
58.
58. Material Inward Continue.. C) RMC (Ready Mix Concrete): (FIM
Material) Client may give RMC instead of cement Physical received
and challan / slip quantity should be the same Any difference needs to be
communicated to the client on a regular basis. This is the case when client
has outsourced RMC production. Further monthly reconciliation should
be done to resolve the dispute, if any. Special Precautions required if
multiple agencies are working at the client location.
59.
59. Material Inward Continue.. II) Procured Material Inward: Sand &
Aggregate / Boulder & Ruble: Sand & Aggregate preferably to be
purchased on CFT basis. Also advisable in rainy season. CFT basis
material should be measured every time by three point of vehicle and
considered average area and this quantity mentioned as received in
challan Boulder / Rubble on MT basis due to voids These items should
be delivered by supplier with proper intimation Materials would be
delivered during day time Location of Weigh Bridge In rainy season
stock would be store of Sand & Aggregate for any short fall and avoid to
pay more cost Royalty slips info@consultconstruction.com
60.
60. Material Inward Continue.. II) Procured Material Inward:
Binding Wire should always be weighed at the time of inward and its
thickness should be matched as per order. No. of Bundles should also be
mentioned in the challan. Conplast / Admixture - Inwards with
manufacturing & expiry date and number of drum and the same should be
visible on each drum Wooden material: Plywood = This should be as
per specification given in PO like thickness, weight per sheet, regular or
water proof, size, qty. in numbers and sq.ft. Batten = Batten size should
be as per specification of PO like thickness & length, Abnormal damage &
short length pieces should not be allowed and the qty should be mentioned
in CFT in challan info@consultconstruction.com
61.
61. Material Inward Continue.. III) Returnable Material Entry: If any
material, equipment or items are to be sent out, client procedure and
documents should be followed with all records to avoid any delay in project
completion. Material entry gate pass Inward stamp with date and time
and sign of authorized Material description with quantity etc.. Any
improper inward could prove costly for the company in future.
62.
62. Material Inward Continue..IV) Loan Transaction: This happens,
where more than one contractor work in the same client premises. This
type of transactions should be done by site Project Manager in emergency
case only and with approval from his higher authority. This is returnable
basis so the same should not be outstanding for more than specified days
and should not be a routine practise. Quantitative document should be
generated and kept in record info@consultconstruction.com
63.
63. Material Inward Continue.. V) Basic documents at the time of
Material Inward : Documents - Challan / Packing list / Inter-site Transfer
Memo / Excise Gate pass / LR / Weight slip / Royalty Challan / Test
certificates / PO copy or PO references / Tax Invoice / Statutory forms (If
any). Authorized sign required if overwriting available. Mention of Short
quantity & unmatched specification Material inward stamp & Entry in
material inward register / system & Unique inward number on documents
No material shall be dumped without pre intimation to store and presence
of store person. Rejection Policy info@consultconstruction.com
64.
64. Material Outward Codification of materials Divide the materials
into Capital Goods / Construction Materials / Consumables and Tools.
Codes as per class of material. Material Issue Slip Duplicate
Authorised from Site Engg. Basis of Computer Entry Watch on Missing
serial numbers Steel, Sand, Agg., etc consumption entry should atleast be
passed as per RA Bills certified quantity. In case of emergency /break
down of batching plant if RMC procured from other sources, then FIM
Cement can be issued to supplier and rate should be excluding cement.
Returnable register to be kept separately. Material required in same form
from receiver Computer System to have Alternate UOM provision E.g.
Wooden Items, Sand, Aggregate. Free And Chargeable Materials List with
stores. info@consultconstruction.com www.consultconstruction.com
65.
65. Non Moving material Store should not allow those material
which are not requiredor excess quantity compare to required at site
Disadvantage of non movement items Staff engagment Cost of
logistics & Inventory carrying cost Space usage of store Problem to
Handling / Take care info@consultconstruction.com
66.
66. Site visit by Store personal Store personal should visit site on
every day for following purposes: Idle material Damage & Scattered
material Ensure that no material is lying in mud or in excavated holes,
before back filing (Especially scaffolding material like coupler, pipes &
shuttering plate etc..)Lemon info@consultconstruction.com
67.
67. Physical Stock Verification Compliance to A Class routine
audit verification every queries. quarter and System report other
categories should not contain every six months. any negative items.
System report System Print should be clear like A-B-C Bills received but
after Updated Identification goods not received Data entry. Ensure that
material Physical count movement is challenges restricted before taking
Scaffolding / physical stock. Shuttering Proper Stacking Rough Idea
and labelling Steel, Sand, Agg Expert estimate Multiple locations
68.
68. Control over Fuel ConsumptionFollowing points need to be taken
care for Equipments - JCB, Miller, andCrane / Vehicles:- Store should
have resources like Fuel pipe, Filter & pump to fill fuel from one to
another can, Two standard size Barrels of 200Ltrs capacity, Fuel small
Can of 1ltr, 5Lts, 10Ltrs Scale to measure balance stock of fuel (Rod)
Lock and key - Fuel tank All vehicle and equipment Meters should be in
working condition. MRN containing authorisation from Project Manager &
HR Incharge for fuel issue with vehicle & equipment number. Physical
meter reading should be verified and mentioned in log sheet at time of fuel
issue. If vehicle permanently work at single location, name of location is
compulsory. Vehicle Report - MIS. Tracking fuel given on chargeable /
Free issue basis. info@consultconstruction.com
69.
69. BTN Whether such system exists at the client place
70.
70. Other Areas - Scrap Yard Items in Scrap yard should be properly
segregated as per nature and length to enable re- use. Frequent Disposal
of scrap Items required. Distribution of Scrap wood amongst labour
71.
71. MIS MIS report, its format and period should be
defined.Following reports required fom store: Material Movement for the
period Intersite Material Movement Fuel Transaction report with party
wise Safety material movement Chargeable Material / Debit Note
RMC Production & Principle items consumption Physical Stock Non
Moving Material info@consultconstruction.com
72.
72. Human Resource info@consultconstruction.com
73.
73. HR Related Controls - Labour Colony / Mess / Attendance /
Vehicle Management info@consultconstruction.com
74.
74. Sub Contractor Management Sub-contractor Data bank on
the basis of skill set and past performance. Incentive scheme for time
bound completion info@consultconstruction.com
75.
75. Human Resource cont. Master Details of Sub Contractor:
Two passport size color photograph Name with firm name Copy of PAN
card without which TDS liability shall be @ 20% in place of regular rate
Identity poof Address proof (Election Card, Latest light bill or Panchayat
certified letter) Communication details (Like, Landline / mobile with

contact person & Fax number, mail ID, Web site) Bank name, Branch
address, Account type, Account number and RTGS No., cancelled cheque
or declaration letter from the bank Specimen signature of authorized
person in absence of the main sub contractor .
76.
76. Human Resource cont.Labour Over time: There should be
proper system to record the duty hours in the labour card:- Contractor
name and labour name In time and out time Company supervisor sign
for allowing OT who shall also be responsible to reply why OT was allowed.
Track of supervisor sanctioning highest OT Labour / sub contractor sign
is required Daily report & Control Labour: HO must ask for manpower
report and work progress report from Site on a daily basis to assess the
work performance. info@consultconstruction.com
77.
77. Human Resource cont. Gate Pass (GP) / Entry Card:
Company must issue Gate Pass (GP) / Entry card for control and security
purpose to sub contractors and all employees and labours. The same can
be cross checked with daily manpower report to catch discrepancy if any.
Following details are required in the gate pass: Unique serial number and
area / Period wise color if any Name of labour Sub Contractor name
Type of skill (Helper, Carpenter, Mason, Fitter) Date of GP issued and
validity (Validity would be three months) Blood Group Color photograph
through Web cam and color printer Company may charge some nominal
amount for GP Sign required of HR and sub contractor on Gate Pass
HR should have details of gate passes issued in the manual register where
GP receiver sign is required. HR should have GP wise status (Active,
Cancel, Expired) Penalty should be charged If Gate pass is lost, expired
but not renewed or not returned at time of leaving the job All Gate Passes
should be destroyed which have been returned by workers / sub
contractors after proper entry in manual register or system
78.
78. Human Resource cont. PF Records and Liability payment:
If the sub-contractor is well organized, then he can pay PF and keep
proper records and just deliver paid challan with its break up for your
record. But where Sub contractor is unorganized, it is necessary to get
sub contractor wise wages sheet to calculate PF liability and pay. Labour
Colony / Water & Power supply: Labours are asset for the company and it
should take care of their basic needs. This should be the responsibility of
HRD to visit labour colony at fixed interval to find out if their living
conditions are proper Basic aspects like PCC in flooring of room,
Drinking & routine use Water, proper toilets and bath rooms, power
supply, cleaning around labour colony to ensure it hygienic, monthly
medical check up etc. This will result in improved performance in the
labour output. info@consultconstruction.com www.consultconstruction.com
79.
79. Human Resource cont. Employees Salary Structure &
Letter of Appointment: Salary Structure: Say Basic 40% of total salary
Other Allowances 60% of total Salary, like: HRA Allowance Uniform
PF Bonus Medical Allowance or Group Mediclaim policy
Transportation Allowance Telephone / Conveyance Reimbursement
Child Allowance Education Allowance Deductions: PF employee
contribution 12% of Basic Professional Tax Employee, as per salary
slab Tax Deduction at Source (TDS) as per Government rules on taxable
salary Staff Welfare Fund as per Government rules If any bond amount
decided, to deduct from salary on monthly basis
80.
80. Human Resource cont. Master Form - Employee: Branch /
Site Transfer Letter: Salary Structure O/s Advances and Loans o/s
Salary Dues with present days of last working days at previous site
81.
81. Human Resource cont. Daily Attendance - Staff: Daily
attendance can be marked by manual records like - Register or Daily Sheet
or Card or by Auto systems like Punch card, Thumb or Finger impression
or based on any other online software, Over Time: There should be well
structured Policy to regulate and monitor the over time payment. There
are two options to maintain OT records a) Out time to be mentioned in
Daily manual attendance sheet b) Separate Sheet to be maintained for
OT HR needs to take sign from Project Manager on daily OT sheet or Daily
attendance sheet. At the end of the month, OT hours shall be calculated on

the basis of this record. info@consultconstruction.com
82.
82. Human Resource cont.Leave Policy: Leave policy needs to
be defined Various types of leave and their number Carry forward or
lapse in the year end Encashment Maximum accumulation etc. Further
employee needs to fill a leave application form containing following details:
Leave application vs. Daily / Monthly Attendance sheet Leave period
and number of days Applicant signature required on form Approving
authority depending on number of days leave applied Leave utilized
mentioning clearly against which category (i.e. Paid Leave - PL, Casual
Leave - CL & Sick Leave - SL) on application Status of leave balance
category wise as per rules To avoid misuse of sick leave, medical
certificate must be required on return from leave if the leave is more than
say one or two days Absent should be marked for extension of leave
beyond sanctioned HR should verify perfectly about leave balance before
action on application info@consultconstruction.com
83.
83. Human Resource cont. Hired Camp Lease Agreement
Distance from the Site Proper Planning to avoid Hotel Expenditure
Mess - Staff: Self vs Contracted Fixed Payment to employees Policy
should also be defined for other facilities of stay and in house
entertainment by way of TV, reading materials, sports and club activities
etc. Group Employee Health Insurance Policy: HRD needs to evaluate
group medical policy v/s medical allowance. It is advisable to go for
mediclaim Insurance for which policy should be well defined. Accordingly
all concerned employees and officers should be covered as per policy
which should be taken from General Insurance Company with full
negotiation. There should be one officer in charge for claim settlement in
time so as to get the benefit of the Insurance.
84.
84. Human Resource cont. Vehicle Report Admin Assets &
Control Laptop Data Card CUG Mobile connections SIM card
Mobile Instrument Camp / Guest House & Mess, Vehicles, Equipment
etc. HR should have master data of details of all admin assets and this
should be updated on regular basis (Monthly / Quarterly / Half yearly) like
Name of asset Asset user name Location Insurance period and
Service provider, if applicable Company can take undertaking from
employee against asset given for use. There should be well designed
policy in place about entitlement to regulate the use of such assets.
85.
85. Human Resource cont. HR MIS Level of Perfection
86.
86. Statutory Compliances required at the Construction Site Labour
Law Requirements Labour License Minimum Wages PF / ESI
Workmen Compensation Workers cess Minimum Wages Professional
Tax VAT Provisions Documentary Requirements Difference between
VAT and WCT What is Entry Tax? Check Post Related Issues CST
Provisions Service Tax Provisions info@consultconstruction.com
87.
87. Labour License Two authorities to be approached Centre /
State Any unit belongs to Central Govt, then license to applied to Central
Government Form No. 4 to be applied for before commencement of work.
It is applicable on client to client basis. After Initial Declaration, there is a
provision to increase the number, but no provision to decrease. Security
Deposit for Gujarat Govt is Rs. 270/- per worker and Centre is Rs. 90/- per
worker. On completion of work Taken Work Compl. Cert from Client and
submit to License Authority info@consultconstruction.com
88.
88. EPF Act Applicability i) Every establishment in which 20 or more
persons are employed and But Across India, there is only one EPF
Number. For ease of administration you may ask for a sub- code. No. of
Labour on which EPF is paid should not be more than sanction as per
Labour License info@consultconstruction.com
89.
89. Eligibility Any person who is employed for work of an
establishment or employed through contractor in or in connection with the
work of an establishment. Basic Salary more than Rs. 6,500/- not covered.
90.
90. ESI Act provides for certain benefits to employees in case of
sickness, maternity and employment injury. It applies to all factories
(including Government factories but excluding seasonal factories)
employing ten or more persons and carrying on a manufacturing process
with the aid of power or employing 20 or more persons and carrying on a
manufacturing process without the aid of power
91.
91. Coverage and contribution The existing wage-limit for coverage
under the Act, is Rs.15,000/- per month Currently, the employees
contribution rate (w.e.f. 1.1.97) is 1.75% of the wages and that of
employers is 4.75% of the wages paid/payable in respect of the employees
in every wage period info@consultconstruction.com
92.
92. Construction Sites ESI does not apply But Insurance by way
of WC Policy is advisable. info@consultconstruction.com
93.
93. Workmens compensation Act, 1923 The Workmens
Compensation Act, aims to provide workmen and/or their dependents
some relief in case of accidents arising out of and in the course of
employment and causing either death or disablement of workmen. It
provides for payment by certain classes of employers to their workmen
compensation for injury by accident. info@consultconstruction.com
94.
94. Employers liability The employer of any establishment covered
under this Act, is required to compensate an employee : Who has suffered
an accident arising out of and in the course of his employment, resulting
into (i) death, (ii) permanent total disablement, (iii) permanent partial
disablement, or (iv) temporary disablement whether total or partial, or Who
has contracted an occupational disease info@consultconstruction.com
95.
95. THE EMPLOYER SHALL NOT BE LIABLE In respect of any
injury which does not result in the total or partial disablement of the
workmen for a period not exceeding three days; In respect of any injury
not resulting in death, caused by an accident which is directly attributable
to- Place of occurrence is outside site premises and not in connection
with the works Further two more issues need to be kept in mind subject to
certification from the authority the workmen having been at the time
thereof under the influence or drugs, or the willful disobedience of the
workman to an order expressly given, or to a rule expressly framed, for the
purpose of securing the safety of workmen info@consultconstruction.com
96.
96. Building and OtherConstruction Workers Welfare Cess
Act,1996LEVY AND COLLECTION OF CESS. -(1) There shall be levied
and collected a cess for thepurposes of the Building and Other
Construction Workers(Regulation of Employment and Conditions of
Service) Act,1996, at such rate not exceeding two per cent but not lessthan
one per cent of the cost of construction incurred by anemployerIt is
applicable to all contractors working for state or forprivate
sector.Enforcement in the private sector is very poor.
97.
97. Minimum wages Act, 1948 Wages for Centre ( or Wages for
State (Unskilled Rs. 135.40) Whichever is higher Every 6 Months, the
govt declares special allowance which needs to be added Same Rate for
Male and Female info@consultconstruction.com
98.
98. Professional Tax Corporation Level Subject Registration
required for all the branches Whether Construction Site is a Branch?
Payroll Generated from Head office For Casual Workers the provision
does not apply info@consultconstruction.com
99.
99. Shop and Establishment Does not apply to construction site
But it applies to establishment info@consultconstruction.com
100.
100. VAT Composition Format of Invoice / Charge of Taxation
Input Tax Credit Check Post Related Issues TDS Forms from
Department Inter-State Movement info@consultconstruction.com

101.
101. Types of composition For complete contract within 30 days of
commencement of Work For Complete year Application within 30 days
before to commencement of year For New Registered Dealer Within 90
Days from the effective date of registration No condonation of delay
Matter Pending before Tribunal Non receipt is assumed as granted
102.
102. Format of Invoice Under Composition Retail Invoice Tax
Invoice info@consultconstruction.com www.consultconstruction.com
103.
103. VAT Input Tax Credit ITC available on all inputs used in
works contract other than composition method subject to fulfilment of
conditions Broad Restrictions on ITC: CST purchases Capital goods
used in works contract Some of the States Lease goods Goods
purchased from Lump sum dealer Goods not connected with business
Vehicles, equipments, accessories or spare parts Fuel used in motor
vehicles Goods used as fuel in generation of electrical energy
104.
104. Entry Tax related issues under VATInward Movement1. Cement
/ Raw Steel / Motor Vehicle are liable to entry tax.2. Authenticated Form
403 is required.3. Invoice / delivery challan / LR to be made available at
checkpost4. For normal Items, Form 403 without authentication is
required.5. Scaffolding Pipes are not covered.Outward Movement1. Branch
Transfers Work Order / Declaration Form / Form 402.2. Relevance of F
Form Ambika Steel.3. Having registration / Work order from other
state.Any checkpost related issues ? info@consultconstruction.com
105.
105. C Form / Way Bill / Entry Tax Transfer of materials from one
state to another. Multi State VAT Compliance
106.
106. TDS Rate under GVAT Person responsible for payment
exceeding Rupees 1 crore for works contract is responsible for deduction
of tax at prescribed rates TDS Rate : 0.6% in case of construction contract
and 2% in case of others Works Contractor is mandatorily required to
obtain TDN No. from Commercial Tax Department. Application in Form 706
to get TDN No. within 30 days of agreement. TDS to be claimed in the year
in which same is deducted and not in which the same is? paid. Form 702
under Gujarat VAT to be attached with Invoice for lesser deduction.
107.
107. Inter-State Movement of Material Movement of Raw Material
Movement of Finished Goods Use in Works Contract Payment of CST /
VAT info@consultconstruction.com www.consultconstruction.com
108.
108. Service Tax Concept of Centralised Registration Method to be
opted Cenvat Credit Invoice Related Issues Service Tax vs VAT Point of
Taxation Smart CA info@consultconstruction.com
109.
109. info@consultconstruction.comwww.consultconstruction.com
110.
110. Control Points for Equipments Own vs Hire Transit Miller
Scaffolding Pipes Batching Plant Shuttering Material Concrete Pump
Walkway Jali Crane Clamps Excavator Other support structures
Tractor Trolley info@consultconstruction.com www.consultconstruction.com
111.
111. Commercial Procurementi) ServicesEquipment / Machinery /
Plant / Tools provide by Client: Condition of equipment Third party can
be appointed Maintenance scope Operation of Equipment Round the
clock Availability Advisable to clear the commercial aspects for supplies
beyond the scope as this might result in recovery from the contractor.
Transportation point for FIM & Transit risk within the site.
112.
112. Equipments - PurchasedAdvantages of buying - No
dependence on others. Companys status & capacity as a contractor will
be rated high . Equipment can be moved from place to place as per
requirement. Bigger jobs can be obtained.Disadvantages of buying
Working capital gets blocked. Repayment in time is big a responsibility.
Resell value shall be negligible in case the same is not required
Maintenance cost and expertise will be required to run the equipment
smoothly. info@consultconstruction.com www.consultconstruction.com
113.
113. Equipment - Hired Hiring Agreement: The user pays fixed hire
charges on daily or monthly basis as long as the equipment is held by
him, Hire the equipment & machinery Minimum average commitment

required in case of Vehicle and equipment & machinery Rate should be on
hours basis excluding lunch / dinner hours to avoid OT over
head.Advantages - Need not to invest the FUND Claim as expense for
Income Tax purpose If service, maintenance and operational cost is in
supplier scope, no any handling issue and cost and that means peace of
mind In case of business close down, no headache except to return the
equipmentDisadvantages - Company totally dependent on others Hired
equipment does not enhance companys status In case of under
utilization, it will result in big loss Company will depend for Service / repair
& maintenance on supplier Without suppliers permission, equipment can
not be moved to other site info@consultconstruction.com
114.
114. Buying or Hiring Buy Value * 4 Times should be the
turnover. Future Planning Residential / Commercial / Industrial / Power
Debt : Equity ratio should not be more than 2:1. Buy Own O&M Team,
Driver info@consultconstruction.com www.consultconstruction.com
115.
115. Cost of owning an Equipment Depreciation Cost of Capital
Equipment Operating Cost info@consultconstruction.com
116.
116. Hired Equipment Controls Equipment Chart
117.
117. Transit Mixture on HireEquipment control points in case of
Hired:Transit Mixture 1 Make, Size / Capacity & other specification if any
Example: a) Make - Schwing Setter, b) Capacity - 6 M3, 2 Age of
equipment In Good working condition and less than 5years 3 Team Qualified Operator / Driver, Crew member & Maintenance team Team:
Qualified Operator / Driver - 1, Helper - 1 & Mechanic for Maintenance - 2
118.
118. Transit Mixture on Hire 4 Testing / Calibration / Commission
certificate - Required from third party whose Govt. approved person /
agency? No, But Water Pump should be in working condition with water
tank. 5 Insurance of Equipment / Chassis / Vehicle / Operational team &
Third party YES 6 Guidelines / Manual for user with Equipment YES,
Optional info@consultconstruction.com www.consultconstruction.com
119.
119. Transit Mixture on Hire 7 Self certified photocopies of RTO
documents of Equipment YES 8 GPS System Recommendatory, However
required if more than two millers at the site with wide area. 9 Equipment
with Basic things Hours & Kms meters in working condition, Proper number
Plate / identification mark, Front, Break lights in working condition with
Mirrors, night radium plate / colors, First aid, Tools & tackles
120.
120. Transit Mixture on Hire 10 Minimum Expected Output per
month Needs to be decided for each and every project - Suggestible Qty 2000 CUM 11 Hiring approx. amount. Monthly Basis - Rs.1.25 Lacs
(Excluding Fuel) 12 Minimum Working Duration in a month Flexible 260hrs
in a month (Note 3) 13 Fuel & Power, Oil & Lubricants a) Its advisable to
ask the supplier to quote his rate with Fuel. Oil and Lubricant should
always be in supplier scope. b) If fuel is in our scope then avg consumption
norms may be fixed. Fuel consumption per hour as per site experience.
121.
121. Transit Mixture on Hire 14 Daily Log Book / Records Supplier
to maintain daily log book / records with sign of both - operator and
Company authorized person. 15 Lock & key & Daily Records custody? If
fuel is in the scope of company, Fuel Tank Key and Records should lie with
the company. info@consultconstruction.com www.consultconstruction.com
122.
122. Transit Mixture on Hire 16 Minimum Output performance
clause of equipment Depends on batching plant setup & destination of
structure. For e.g. 18 M3 casting per hour If TM takes 20min for one trip.
Then 3 trips in one hour = 6 M3 per TM x 3 trip in one hour. 17 Attendance
The operating team should be available at the site during the working days.
The bill shall be reduced proportionately in case of absence. (Monthly
Billing Amt / 26 * Absent Days). 18 Overtime clause OT shall start after
expiry of flexible hours limit in the month and shall be calculated on pro
rata basis (Monthly Rate / 260 Hours). info@consultconstruction.com
123.
123. Transit Mixture on Hire 19 Incentive clause Volume based and
other points like - lower break down, Safety during the work etc. 20
Equipment maintenance / Break down clause Permission for maintenance
on any 4 half days in a month or as and when it is free after discussion with
site PM. 21 Staff / Team Accommodation & Fooding clause Staff / team
accommodation shall be provided by us But Food shall be in your scope
22 De Hiring Notice Period 7days on both sides to avoid any dispute.
124.
124. Transit Mixture on Hire III ) Billing & Payment: 23 Mobilization
& Demobilization clause a) Mobilization = i) Within 10days from date of WO
(mail or hardcopy) with all required resources. ii) One month mobilization
advance to be recovered in six equal monthly installment. b) De Mob. Cost
= If Contract is more than six months than in lessors scope. 24 Billing &
Certification cycle info@consultconstruction.com
125.
125. Transit Mixture on Hire 24 Bill Submission = Billing on monthly
basis. to site PM within 5days of previous month with sign, stamp & inward
date from company. In case of failure to get inward stamp or received sign,
Accounts shall not accept the same. b) Bill / Supporting = Main bill in
triplicate copy with company name, address & site, WO number, Bill date,
period, name & make of equipment. All statutory numbers, break up of
taxes, OT with proper calculation, incentive if any. Original Log sheet
(Duplicate copy must for your records). info@consultconstruction.com
126.
126. Transit Mixture on Hirec) Bill Certification = Bill shall certified
within a week from the date of invoice / inward with stamp and authorized
sign & name by company. 25 Payment cycle Payment shall be made within
20days from the date of bill certification 26 Debit / Recovery clause in case
of break down or non performance / Any other damage Normally at time of
certification or separately if issued by any other department or client for
any non-compliance. 27 Local / RTO tax in scope of supplier All statutory
(local / RTO etc.) liabilities in your scope, inclusive of rate. Service tax shall
be paid extra. 28 TDS & any other Statutory deduction if any TDS or any
other statutory deductions as applicable shall be deducted. D) Safety: 29
Clearance and data for Gate / Entry Pass Requirement of the principal
client may be mentioned here. 30 Safety rules & regulation, violence &
Penalty Requirement of the principal client may be mentioned here with the
penal clauses, if any.IV ) Legal: 31 Clause - Child labour Strict Compliance
32 Clause - Termination of Contract In case of non compliance of any
condition and delay in work performance, contract shall be terminated
immediately without any cost. 33 Jurisdiction Jurisdiction is Ahmedabad
only info@consultconstruction.com www.consultconstruction.com
127.
127. Role of Site Accounts and Co-ordination with Head
OfficeChanging Defn - Democracy info@consultconstruction.com
128.
128. Model of Accounting Branch / Centralized The model most
prevalent, provided you have good team of accountants with you is the HO
and Branch Model. Branches maintain accounts at the construction site
itself. Because if we have a smart accountant at the site that would serve
as the best internal control measure. Integration of accounts and Inventory
would then be possible. Complexity involved is you then need a perfect
co-ordination between HO and Branches. Reconciliation between the two
is required on a regular basis. As many a times HO would directly be
making payment to Branchs creditors without routing the same through the
branch. In case of centralised accounting the certification systems have to
be perfect. You would need all the documents to be certified by the Site
Incharge and respective area incharge before booking the same in
accounts. info@consultconstruction.com www.consultconstruction.com
129.
129. Role of Site Accounts Preparation of cash vouchers and entry
into the system. Maintaining Bank book with not more than one day
transaction lag. Documentation of purchase bills after comparison with
P.O and entry into the system. Entry of subcontractor bills Co-ordination
with the engineering dept. Working out weekly cash requirements Entry
of debit notes in contractor accounts: - Executory Debit notes from
Stores. Debit notes from H.RFunctions: - Debit notes from Engineering
Dept. Periodic entry and payment of statutory dues TDS selfassessment and monthly payment. PF Payment in co-ordination with
H.R Service Tax Preparation of input credit details

130.
130. Role of Site Accounts cont. All vouchers need to be
authenticated by the accountant. Vouchers carrying amount more than
Rs.10K need to be authorized by PM. Comparison of sub-contractor bills
with Work orders. Ensuring that Full and final payments are made to the
contractors and employees only after getting a completely filled Work
Termination Form. Making payments against bills only after getting them
pre-audited. Control Ensuring that Subcontractor Master details are
available before his first bill is entered in the system. Functions: - Sending
backups to HO on a weekly basis. Ensuring periodic reconciliations in the
following manner :- Intersite Reco on a fortnightly basis. Bank Reco
on a monthly basis. Supplier Reco on a monthly basis.
131.
131. Role of Site Accounts cont. Preparation of Labour supply
bills. Preparation of documents/letters as required. Submission of bills to
the client. Sending Original Work orders / LOI / amendments to HO after
keepingAdministrative copies. Ensuring original TDS certificates are sent
to Head office. Functions : - Other site Co-ordination. Monthly profit
centre performance reports.- 20 days Weekly Cash & Bank summaries.2 days Monthly liability statement. 20 days Monthly vehicle reports.- 5
days Report on TDS deduction every month. 25 days Reporting
Quarterly Service Tax input credit details. 10 days Functions: - Pending
sub-contractor bills on a fortnightly basis for the previous months duly
authenticated by the project manager. 2 days
132.
132. Role of Site Accounts cont. Accounts MIS
133.
133. Role of Site Accounts cont. Onsite Integration Model for a
Construction Site Using cloud servers, access can be given to multiple
locations without buying any software / hardware. Stores Material
Receipt entry can be passed from the site provided there is a proper
internet connectivity. When the purchase Invoices are received the same
are certified by the stores department and the printed MIN is then attached
behind the invoices. Accounts then enters the rates of materials picking
up the tracking number. Any deviations are settled by way of Debit / Credit
Note. Materials are then issued by way of Delivery Note to either the
client / sub-contractors. info@consultconstruction.com
134.
134. Payment Advice Format Site :_____________ Date
:________________ B) Supplier of Capital D) Rent ( Labour Colony /
Room E) Vehicle Hire / PetroleumSr.No. A) Supplier of Material Goods C)
Sub-Contractors / House ) Suppliers 1 Purchase Order Purchase Order
Work Order Rent Agreement Log sheet 2 Tax Invoice Tax/Retail Invoice RA
Bill L.C. visiting Reports - HR Auth.-Commercial/H.R. Authorization from
Authorization from 3 Authorization from Site EIC Project Director
Commercial Dept. Authorization from H.R. Authorization from Site Incharge
Authorization from Project Authorization from Authorization from
Authorization from Commercial Authorization from Project 4 Director
Commercial Dept. Project Director Dept. Director Stamp of Quality & Bill
Entry in books of accounts Authorization from Commercial Installation from
Site Authorization from Site Authorization from Project with Deduction
(maintenance 5 Dept. Incharge Incharge Director /spare parts... ) Bill Entry
in books of Debit notes receive & accounts with all entered from Stores
Stamp of Quality & Qty. deduction (TDS / VAT & (Safety material) & Bill
Entry in books of accounts Bill / Voucher / Supporting 6 verification from
stores Other) H.R.D. (G.P.s) with Deduction (TDS ) Proper filing Bill Entry
in books of accounts with all Reconciliation of Material Bill / Voucher /
deduction (TDS / Bill / Voucher / Supporting Monthly Vehicle Report of 7
against Client Billing Supporting Proper filing Retention .) Proper filing
payment month Bill Entry in books of accounts with all deduction (TDS/VAT
& Receive partys Bill / Voucher / 8 Other) Confirmation Statement
Supporting Proper filing Supplier master form Supplier master form
Receive partys Confirmation Client vs. Subcontractor Authorization from
Internal Authorization from Internal 9 Statement with Reco. Status of excise
credit Qty. Auditor Auditor Whether Against "C" EIC Performance Report
10 Whether Against "C" Form Form for the site 13 Remarks required if On
Account or Advance: - Amount Released info@consultconstruction.comFor
H. Details of Payment (chq no. etc.) www.consultconstruction.comO. use

Remarks
135.
135. Banking Whether centralized or Branch wise We are
presently in a world where banks are all connected, so we may opt for a
Centralized banking system, but then if you have a HO and the Branch
Model, you need perfect controls in place before the HO releases funds.
Payment Authorization Vouchers A system that can be implemented,
similar to controls that we have in SAP. Further if we have to plan the
funds and ensure that funds generated from a particular site are available
for only that site after HO takes out its share of profit, then it is advisable to
have separate accounts for the branches. info@consultconstruction.com
136.
136. Managing the Financing Needs of the business Limits with the
Bank Fund Based / Non-Fund based. Non-Fund based Limits are of
great importance in the construction sector, as for any Project that is about
to begin, the client is willing to give Mobilisation Advances against Bank
Gaurantees. Hence as a consultant you can fight hard with the bank to
secure best terms in the Non-fund based limits. With a good order book
you can get away by giving 25-30% collateral to some of the private banks
in the market. info@consultconstruction.com www.consultconstruction.com
137.
137. [Internal Audit] Trust info@consultconstruction.com
138.
138. Lets have a look at an Internal Audit Report

Internal Controls at Construction Site

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Internal Controls at Construction Site

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Internal Controls at Construction Site

with Head Office03.45 pm 05.15 pm info@consultconstruction.com

QSD at HO, if any . If delay reasons need to be submitted to HO.

DPR should be generated. RA bill preparation on Time as any delay

departments of the client info@consultconstruction.com

JMR/BBS/Stores Good Back up at HO Handing over Checklist5 Proper

for Bulk Items) Safety to be ensured:- - Heavy material on surface / lower

certified letter) Communication details (Like, Landline / mobile with

attendance sheet. At the end of the month, OT hours shall be calculated on

Department Inter-State Movement info@consultconstruction.com

him, Hire the equipment & machinery Minimum average commitment

H.R Service Tax Preparation of input credit details

H. Details of Payment (chq no. etc.) www.consultconstruction.comO. use

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