Contarct Management Procedure R2 .doc

GUIDELINES FOR CONTRACT ADMINISTRATION

History of Revisions

Issue No.Issue DateChapter/clause no. & text affectedReason for revision

0116.12.2013New Draft

0215.01.2014Duly edited as Final roll out

Per inputs from

regions

Table of Contents

Chapter No.Title of chapterPage No.

Cover Page01

History of Revisions 02

Table of contents03

1.0Purpose04

2.0Scope and Application04

3.0Definitions04

4.0Predecessor & successor processes04

5.0Responsibility & Authority04

6.0Process Flow Chart 05

7.0Process Description05

8.0Efficiency & Effectiveness measures06

9.0Records07

10.0Enclosures07

11.0Reference07

1.0 PURPOSEThis process is to ensure management of all construction contracts in a wholesome and unified manner to minimize disputes and delays attributable to contractual issues.

2.0 SCOPE AND APPLICATIONThis procedure shall apply to all construction/works contract entered into by GPL with various contractors. Contracts with material suppliers and consultants are outside the scope of this process.3.0 DEFINITIONS AND ABBRIVIATIONSPM Project Manager of the CompanyCM Regional Contracts ManagerHOC- Head of Contracts of the Company

HOL-Head of Legal Division of the Company

HOF-Head of Finance of the Company

COO- Chief Operating Officer of the Company CAD-Contract Appreciation DocumentEOT-Extension of TimeDLP-Defects Liability Period4.0 PROCESS PREDECESSOR & SUCCESORPredecessor Process: Tender Award Process as per SOP Concurrent Process: Construction

5.0 RESPONSIBILITY AND AUTHORITY

Preparation of CAD: PMRoutine correspondence with contractor: PM. Otherwise By PMC under specific authority by Regional Head in writing.Responding to claim letter: PM in consultation with RH/ HOCSuspension of Contract: By RH on agreement with HOC in writingResumption of Contract: By RH on agreement with HOC in writingMaintenance Issues before start of DLP: PM

Maintenance issues during DLP- PMC / PM / RH /Approving variation in contract: COOGranting EOT: RH on receipt of approval by COO6.0 PROCESS FLOW CHARTNA7.0 PROCESS DESCRIPTION6.1 Preparation of CAD: At the award of a contract to the Contractor, PM/CM shall thoroughly read the tender documents submitted by the Contractor including all the Conditions of the Contract both Special and General, Scope of work and all the correspondence, amendments, addenda, corrigenda etc. The PM/CM shall then prepare a Contract Appreciation Document (CAD) as per the format attached within 7 days of award of the contract and shall be got approved from RH with inputs from HO contracts. The CAD is a ready reckoner/snapshot of important provisions of the contract and will be handy guide to the user.7.1.1 Activity ownership

Sr. no.ActivityGPL LeadershipRegionFunctions at HO

CEO & MDED - KT ED - SriniCOO JPRegional HeadPMC & PLiasion C & BDesignDesignC & BC & P CPT

1Contract appreciation documentDRPI

7.1.2 TemplateSr. noDescriptionFormat / templateRemarks

1Template for CAD

7.2 Contract kick off meeting: The PM in consultation with RH shall invite the contractor for the kick off s meeting within 7 days from completion of CAD.

7.2.1 Participation from following stakeholders is expected in this meeting Regional Head

PM

Contracts Site Safety In-charge CMC

Monitoring In-charge CMC

7.2.2 Discussions in this meeting shall broadly cover the following

Contractors Master construction schedule Statutory Compliances from contractor and time lines for the same

Contractor mobilization schedule and status

Project quality and safety plan from contractor Formwork planning and deployment schedule

Submission status of various guarantees to GPL by contractor as per contract conditions.

Understanding of major clauses with the contractor. In case the contractor has a different interpretation of clause then the official clarification shall be issued promptly by PM in due consultation with HOC.

List of contractual submittals and their timelines

Communication protocol to be followed for Contract management

6.3 Contracts register: A register of contractual events shall be maintained at the site to log the events as they take place in the course of execution of the work and administration of the contract. All contractual correspondence shall be in hard copy. In case of any other mode of communication, same shall be backed by letter in hard copy immediately. The contracts register may be maintained as per the format attached.

7.3.1 Template for Contract Register

Sr. noDescriptionFormat / templateRemarks

1Template for Contract Register

6.4 Contractual correspondence: The issues identified under Responsibility and Authority clearly identifies major issues that shall be raised during the Contract Period. The situation shall be dealt with the officer identified having final responsibility. It is not possible to envisage all the situations and variations in the life of a contract but the guiding principle are as under

1. Deal with the communication at the lowest organizational level possible unless there are implications on Contractual issues.

2. If there are contractual issues involved like time and/or cost then it should be referred to the head office through RH.

3. All the communications received from the contractor shall be replied to, unless otherwise decided by the RH/PM.

4. References to the Contractual clauses, dates and facts shall be verified and proper evidence shall be gathered.

5. All the correspondence shall contain verified references and facts which can be ascertained.

6. For all outgoing correspondence dealing with issues such as for EOT, Claims, recovery from the Contractor, Suspension, resumption, certificates etc. an acknowledgement of receipt shall be obtained. For such correspondence in case electronic media is used for its conveyance, a hard copy shall follow with an intention to obtain proof of delivery.

7. Any important issue that has an impact on time and cost shall be separately conveyed to the Contractor notwithstanding its mention in Minutes of Meeting. 6.5 Audit of contracts administration: The HOC shall arrange an audit of the contract administration at every site through in-house team member. The purpose of the audit will be to identify any weaknesses in GPLs administration of the contract and ensure that no contractually adverse situation is allowed to build up due to over sight. . The audits may be conducted once every 6 months or as per the frequency as decided by HOC in consultation with RH6.6. Site Review meetings : To discuss on all issues related to site execution including progress , review meeting shall be conducted with following frequency With contractors site team every fortnightly With Contractors site team alongwith contractors H O representative with Regional head and GPL site team Every month

All discussions and actions points shall be recorded in Minutes of Meetings. Hard copy of the same shall be signed by all stake holders. A separate record shall be maintained for MOMs. It is recommended to start every review meeting by confirming MOM for earlier meeting.

6.7 Contractor Running Bills : Contractor will raise running account bills as per the frequency mentioned in contract conditions. PM or its representative shall certify it promptly. In case of any discrepancy, over billing etc. bill shall be returned to contractor with a covering letter clearly indicating reasons for return and advising contractor to resubmit after necessary correction. Date of submission of revised bill shall be considered as date of submission of bill. In case of number of revisions in bill, date of submission of last revision shall be considered as date of submission.

All R A bills shall be for cumulative quantities and shall be recorded in attached prescribed format.

6.7.1 Template for R A Bill Tracker:

Sr. noDescriptionFormat / templateRemarks

1Template for Recording R A Bill

2Template for R A Bill Tracker

6.8 Extra Items:PM is responsible for identification and settlement of extra items. Following are the guidelines to address extra items.6.8.1 Upon receipt of GFC from consultants, PM shall verify these drawings and identify any discrepancy / Deviations with BOQ items.

6.8.2 PM / CM shall inform such deviations immediately to respective consultant and shall insists on implementing items covered in BOQ.

6.8.3 In case extra item need to be executed due to any reason, the same shall be dealt in accordance with the provisions in contract conditions.6.8.4 : Activity Ownership

Sr. no.Extra ItemsGPL LeadershipRegionFunctions at HO

CEO & MDED - KT ED - SriniCOO JPRegional HeadPMC & PLiasion C & BDesignDesignC & BC & P CPT

1Contract appreciation documentDARPIA

6.9: Insurance (CAR Policy)H.O. Contracts is responsible for obtaining CAR policy for all projects. Following are the guidelines

6.9.1 PM / CM through RH shall send requisition for insurance to H O contracts within 7 days from issue of LOA to Contractor.

6.9.2 H.O. contract will organize for best possible quotes from Insurance companies and shall finalise with insurance provider within 15 days from receipt of requisition from site.

6.9.3 PM/CM shall monitor CAR policy validity including premium payment as per agreed installments and will ensure it is in force throughout construction period.

6.9.4 In case it is required to extend CAR policy due to extension in construction period, PM/CM through RH shall notify the same to H O Contracts 30 days in advance. The requisition shall also confirm the time for which policy need to be extended.

6.9.5 H O Contracts is responsible to ensure extension for CAR policy within the time frame as mentioned above. 6.9.6 - TemplatesSr. noDescriptionFormat / templateRemarks

1Template for Project insurance information

7.0 Closing contract: PM shall produce a summary report at the closure of contract such as the original cost, the final cost, Contract time, Actual Time taken, Major reasons for delays and cost overruns, a list of major contractual issues encountered and the solution described briefly. It shall also incorporate suggestions and/or suggested modifications to the contractual conditions. This report shall be discussed with HOC.

7.0.1 Templates

Sr. noDescriptionFormat / templateRemarks

1List of documents to be checked before Issue of VCC and FCC

8.0 EFFICIENCY & EFFECTIVENESS MEASURESEfficiency Measure

Average time taken to respond to Contractors communication

Effectiveness Measures

Average number of issues pending at audit

Total number of Disputes till closure

9.0 RECORDSCADContract Register

Contract audit report

Closure report

Standard Operating Procedures Contract Administration

Sheet1

S.No. DateCommunication ReceivedType [email/letter]Date receivedContractor's Ref. No.Brief Details of letter receivedDate repliedGPL's Ref. No. Brief Details of reply

Sheet2

GODREJ PROPERTIES LIMITED

CONTRACTS REGISTER

PROJECT NAME

S.N.DateDocument Ref. numberFromToIssueLink to previous letters

Sheet3

_1448975870.xlsSheet1

Information required

Project Name

Risk Location Address

Brief Project DescriptionPlease indicate area under development, height of building, number of buildings etc

Sum-InsuredTotal sum proposed to be insured under CAR policy

Project Period

EscalationAnticipated escalation if any

Value of Glass material

Budget Provision for premium

Any Remark

Sheet2

Sheet3

Payment certificate 01

PAYMENT RECOMMENDATION REPORT

Trade Package

Contractor

Progress Claim No.

Invoice dated

Valuation dated

Invoice Received

1.VALUE OF WORK done

Ref.Package ComponentContract Sum with taxesContract Sum with out taxesPrevious Work doneWork done currentWork done as % of TotalValue of Work done

INRINRINRINR%INR

1GENERAL CIVIL & STRUCTURAL WORKS

Sub-total0.00.00.00.0

Contract Adjustments

Approved Variations

Quantity Reconciliation0.0

Approved P.S adjustments0.0

Approved E.O.T0.0

Value of Work done0.00.00.00.00.0

2.RECOMMENDED PROGRESS PAYMENT

Value of Work done0.0

AValue of Work Completed0.0

LESS:

Retention0.0

Debit applied/approved by PM

Advance recovery

Value of Work Completed for Payment0.0

ADD

Service Tax 4.12 % on A0.0

VAT

LESS:

Previous Payments

0.0

&"Arial,Italic"&8 10 247 - C-66 - General Civil & Structural Works - Payment Recommendation No. 6 (Remaining Amount Release) _Issue 1- Rev. 0

Billing Format

ATTACHMENT TO PROGRESS CLAIM

BOQ - WORK ORDERPREVIOUSCURRENTCUMULATIVE

ABCDEFGHIJKLMNOPQ

SR No.Description of ItemUnitQtyRate (INR)Amount (INR)QtyPrevious % CertifiedAmount (ExGxH)Current % Certified for Previous Qty.Amount (ExGxJ)Qty% CertifiedAmount (ExLxM)Qty% completedCertified Amount (ExOxP)

&"Arial,Italic"&8 10 247 - C-66 - General Civil & Structural Works - Payment Recommendation No. 6 (Remaining Amount Release) _Issue 1- Rev. 0&P/&N

DOCUMENTS TO BE CHECKED FOR ISSUING

A. Virtual Completion Certificate

1. De-snagging report on each item on the snag list.

2. Last running bill

B. Final Completion Certificate

1. Final Acceptance Certificate

2. Final Bill

3. A list of pending claims.

4. Final reconciliation report on the material issued by the Company.

5. Report on inventory of company supplied material remaining on site.

6. Warranties/ installation manuals/ commissioning reports for all Contractor supplied equipment.

7. All copies of company/vendor provided drawings/documents/ instructions etc.

8. All QC records arranged in a neat and referable manner.

9. Commissioning reports for all Company supplied equipment

10. Installation certificates for all electrical/ mechanical equipment including lifts.

11. Inspection certificates from statutory authorities for all MEP equipment including lifts and firefighting.

12. As built drawings incorporating all changes made till de snagging of snag list.

13. Demobilization challans for all contractors equipment.

14. No dues certificate from all the subcontractors of the contractor.

15. Return receipts for all the equipment/ company property loaned/leased or given to the contractor for use.

16. Certificate of verification that the contractor has vacated all companies property including labour hutment area.(Photographs to be taken by the Contractor and signed by the Company)

17. Report to be obtained from Companys representative that all utilities used by the contractor have been disconnected/ taken over in a safe and sound manner.

18. Report from Companys representative that the Contractor has removed all the debris/ waste material/ garbage etc. attributable to him and have left the site in a neat and clean condition.

19. All appropriate guarantees such as but not limited to for retention money etc. extended for number of days specified beyond the likely end of the Defects liability period.

20. All third party warranties in original where the client is the beneficiary.

21. Indemnity bonds discharging the Company of any liabilities mentioned in the contract.

Sheet1

S.No.R A Bill NoDate of Submission by contractorDate of certification by PMCDate of certification by PMRemarks

Bhushan Saney: Bhushan Saney:Indicate in brief reasons for return along with letter reference numberPayment Details

OR PartPartPart

Date of Return to contractor123

1R A bill No 1

R010-Nov-12returned on 14 Nov 12NAReturned vide letter no

GPL/xyz/HO/122 dtd 14/12/12

R117-Nov-1222-Nov-1225-Nov-12Bill certificate send to Accounts on

Sheet2

Sheet3

Sheet1

GODREJ PROPERTIES LIMITED

ANNEXTURE I-CONTRACT APPRECIATION DOCUMENT

S.NO.IssueClause(s)Sub-clause(s)Details

1Scope of Work

2Exclusions from scope of Work

3Contract Time

4Contract Price

5Contractor's Deposits

6EMD

Performance security

Retention Money

Release of EMD

Release of Performance Security

Release of Retention Money

7Utilities

Water

Power

Camp

Site Office

Distribution

8Bank Guarantees (BGs)

Release of BGs

Renewal of BGs

Validity

9EOT Conditions

Contactors fault

Concurrent delay

Clients fault

10Liquidated Damages

11Invoicing

Secured Advances and Recovery

Rate for Extra Item

Escalation

Final Account

12Clients Obligation

Clearances

Free supply

Materials on Basic rate

13Certificates

Running bills

Virtual Completion

Final Completion

Partial Completion

14Defects Liability

Duration

Requirement from Contractor

15Closure of Contract

Sheet2

Sheet3