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DID MANUAL Volume 10
Disclaimer
Every effort and care has been taken in selecting methods and recommendations that areappropriate to Malaysian conditions. Notwithstanding these efforts, no warranty or guarantee,
express, implied or statutory is made as to the accuracy, reliability, suitability or results of themethods or recommendations.
The use of this Manual requires professional interpretation and judgment. Appropriate designprocedures and assessment must be applied, to suit the particular circumstances underconsideration.
The government shall have no liability or responsibility to the user or any other person or entitywith respect to any liability, loss or damage caused or alleged to be caused, directly or indirectly,by the adoption and use of the methods and recommendations of this Manual, including but notlimited to, any interruption of service, loss of business or anticipatory profits, or consequentialdamages resulting from the use of this Manual.
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Volume 10 DID MANUAL
Foreword
The first edition of the Manual was published in 1960 and was actually based on theexperiences and knowledge of DID engineers in planning, design, construction, operations and
maintenance of large volume water management systems for irrigation, drainage, floods and riverconservancy. The manual became invaluable references for both practising as well as officers newlyposted to an unfamiliar engineering environment.
Over these years the role and experience of the DID has expanded beyond an agriculture-based environment to cover urbanisation needs but the principle role of being the country’s leadingexpert in large volume water management remains. The challenges are also wider covering issuesof environment and its sustainability. Recognising this, the Department decided that it is timely forthe DID Manual be reviewed and updated. Continuing the spirit of our predecessors, this Manual isnot only about the fundamentals of related engineering knowledge but also based on the conceptof sharing experience and knowledge of practising engineers. This new version now includes thelatest standards and practices, technologies, best engineering practices that are applicable and
useful for the country.
This Manual consists of eleven separate volumes covering Flood Management; RiverManagement; Coastal Management; Hydrology and Water Resources; Irrigation and AgriculturalDrainage; Geotechnical, Site Investigation and Engineering Survey; Engineering Modelling;Mechanical and Electrical Services; Dam Safety, Inspections and Monitoring; Contract
Administration; and Construction Management. Within each Volume is a wide range of relatedtopics including topics on future concerns that should put on record our care for the futuregenerations.
This DID Manual is developed through contributions from nearly 200 professionals from theGovernment as well as private sectors who are very experienced and experts in their respectivefields. It has not been an easy exercise and the success in publishing this is the results of hardwork and tenacity of all those involved. The Manual has been written to serve as a source of information and to provide guidance and reference pertaining to the latest information, knowledgeand best practices for DID engineers and personnel. The Manual would enable new DID engineersand personnel to have a jump-start in carrying out their duties. This is one of the many initiativesundertaken by DID to improve its delivery system and to achieve the mission of the Department inproviding an efficient and effective service. This Manual will also be useful reference for non-DIDEngineers, other non-engineering professionals, Contractors, Consultants, the Academia,Developers and students involved and interested in water-related development and management.Just as it was before, this DID Manual is, in a way, a record of the history of engineeringknowledge and development in the water and water resources engineering applications in Malaysia.
There are just too many to name and congratulate individually, all those involved in preparing this
Manual. Most of them are my fellow professionals and well-respected within the profession. I wishto record my sincere thanks and appreciation to all of them and I am confident that theircontributions will be truly appreciated by the readers for many years to come.
Dato’ Ir. Hj. Ahmad Husaini bin Sulaiman,Director General,Department of Irrigation and Drainage Malaysia.
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DID MANUAL Volume 10
Acknowledgement
Steering Committee:
Dato’ Ir. Hj. Ahmad Husaini bin Sulaiman, Dato’ Nordin bin Hamdan, Dato’ Ir. K. J. Abraham, Dato’ Ong Siew Heng, Dato’ Ir. Lim Chow Hock, Ir. Lee Loke Chong, Tuan Hj. Abu Bakar bin Mohd Yusof,Ir. Zainor Rahim bin Ibrahim, En. Leong Tak Meng, En. Ziauddin bin Abdul Latiff, Pn. Hjh. Wardiahbte Abd. Muttalib, En. Wahid Anuar bin Ahmad, Tn. Hj. Zulkefli bin Hassan, Ir. Dr. Hj. Mohd. Norbin Hj. Mohd. Desa, En. Low Koon Seng, En. Wan Marhafidz Shah bin Wan Mohd. Omar, Sr MdFauzi bin Md Rejab, En. Khairuddin bin Mat Yunus, & Cik Khairiah bt Ahmad.
Coordination Committee:
Dato’ Nordin bin Hamdan, Dato’ Ir. Hj. Ahmad Fuad bin Embi, Dato’ Ong Siew Heng, Ir. Lee LokeChong, Tuan Hj. Abu Bakar bin Mohd Yusof, Ir. Zainor Rahim bin Ibrahim, Ir. Cho Weng Keong, En.
Leong Tak Meng, Dr. Mohamed Roseli Zainal Abidin, En. Zainal Akamar bin Harun, Pn. NoraziaIbrahim, Ir. Mohd. Zaki, En. Sazali Osman, Pn. Rosnelawati Hj. Ismail, En. Ng Kim Hoy, Ir. Lim SeeTian, Sr Mohd. Fauzi bin Rejab, Ir. Hj. Daud Mohd Lep, Tn. Hj. Muhamad Khosim Ikhsan, En.Roslan Ahmad, En. Tan Teow Soon, Tn. Hj. Ahmad Darus, En. Adnan Othman, Ir. Hapida Ghazali,En. Sukemi Hj. Sidek, Pn. Hjh. Fadzilah Abdul Samad, Pn. Hjh. Salmah Mohd. Som, Ir. Sahak Che
Abdullah, Pn. Sofiah Mat, En. Mohd. Shafawi Alwi, En. Ooi Soon Lee, En. Muhammad KhairudinKhalil, , Tn. Hj. Azmi Md Jafri, Ir. Nor Hisham Ghazali, En. Gunasegaran M., En. Rajaselvam G., Cik Nur Hareza Redzuan, Ir. Chia Chong Wing, Pn. Norlida Mohd. Dom, Ir. Lee Bea Leang, Dr. Hj. Md.Nasir Md. Noh, Pn. Paridah Anum Tahir, Pn. Nurazlina Mohd Zaid, PWM Associates Sdn. Bhd.,Institut Penyelidikan Hidraulik Kebangsaan Malaysia (NAHRIM), RPM Engineers Sdn. Bhd., & J.U.B.M. Sdn. Bhd.
Working Group :
Sr Md Fauzi bin Md Rejab (Pengerusi), Pn. Norazia binti Ibrahim, Pn. Hashimah binti Said, Pn.Fazidah binti Zainal Abidin, Pn. Zalina binti Mat Zain, Pn. Rohimah binti Yusof, Pn. Nor Hasni MuhdSupian, En. Roslan bin Ahmad, Tn. Hj. Hussin bin Haron, Ir. Nasser bin Salim, Ir. Nor Hisham binMohd. Ghazali, Kapt. Ir. Anuar bin Yahya, En. Roslan bin Hussin, Tn. Hj. Muhd Khosim bin Hj.Ikhsan, En. Sulaimi bin Nordin, En. Ratna Rajah, En. Alexander Anak Ngindang, En. Teo SiawChung, En. Mohd Adnan bin Ahmad Fauzi, Ir. Hj. Mohd Razali bin Husain, En. Wan Mohd Azam binWan Long, Tn. Hj. Rashiddi bin Hj Hussein, En. S. Valiappan, En. Adnan bin Ab Latif, Pn. Belindabinti Adzmi, Cik Intan Suraya binti Ayob, Pn. Zaliza binti Mohamad Ibrahim, Sr Ong See Lian, SrNur Aziz Abu Bakar, Lt Kol (B) Ir. Shahar Abdullah, Cik Ho Sook Chin, Pn. Zilawati Hj. Yaakub & Pn.Idura binti Hj. Ariffin.
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Volume 10 DID MANUAL
Registration Of Amendments
Amend No. Page No. Date of Amendment
Amend No. Page No. Date of Amendment
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DID MANUAL Volume 10
Table of Contents
Disclaimer ............................................................................................................................ i
Foreword ............................................................................................................................. ii
Acknowledgement ................................................................................................................. iii
Registration of Amendments .................................................................................................. iv
Table of Contents .................................................................................................................. v
List of Volumes ...................................................................................................................... vii
List of Abbreviations (English) ................................................................................................ ix
List of Abbreviations (Bahasa Malaysia) ................................................................................... xi
Glossary ................................................................................................................................ xiii
PART I - INTRODUCTION
Chapter 1 Introduction to Volume 10
Chapter 2 DID Organisation Structure
Chapter 3 Procurement - Overview
Chapter 4 Project Implementation - Overview
PART II – PRE-CONTRACT
Chapter 5 Authority
Chapter 6 Preparation of Tender Documents
Chapter 7 Invitation and Receipt of Tender
Chapter 8 Tender Evaluation and Acceptance
PART III – POST-CONTRACT
Chapter 9 Contract Documentation
Chapter 10 Payments
Chapter 11 Variations
Chapter 12 Adjustment of Contract Sum
Chapter 13 Delays and Extension of Time
Chapter 14 Non-Completion
Chapter 15 Loss and Expense
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Volume 10 DID MANUAL
Table of Contents
PART III – POST-CONTRACT (Cont’d)
Chapter 16 Determination
Chapter 17 Completion
Chapter 18 Defects Management
Chapter 19 Final Accounts and Final Certificate
Chapter 20 Prime Cost & Provisional Sums
Chapter 21 Dispute Management and Resolution
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DID MANUAL Volume 10
List Of Volumes
Volume 1 FLOOD MANAGEMENT
Volume 2 RIVER MANAGEMENT
Volume 3 COASTAL MANAGEMENT
Volume 4 HYDROLOGY AND WATER RESOURCES
Volume 5 IRRIGATION AND AGRICULTURAL DRAINAGE
Volume 6 GEOTECHNICAL MANUAL, SITE INVESTIGATION AND ENGINEERING SURVEY
Volume 7 ENGINEERING MODELLING
Volume 8 MECHANICAL AND ELECTRICAL SERVICES
Volume 9 DAM SAFETY, INSPECTIONS AND MONITORING
Volume 10 CONTRACT ADMINISTRATION
Volume 11 CONSTRUCTION MANAGEMENT
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DID MANUAL Volume 10
List of Abbreviations(English)
AtP Authorised Party
CAO Contract Administration Officer;the term CAO includes Contracts Officer and/or Quantity Surveyor
CPC Certificate of Practical Completion
CMGD Certificate of Completion of Making Good Defects
CNC Certificate of Non-Completion
DB/T Design and Build / Turnkey
DID Department of Irrigation and Drainage.
DT Design Team, or Designer
FD Finance Division
IO Implementation Officer
Engr Engineer
PD Project Director
PDR Project Director’s Representative
PH Project Head
PS Project Supervisor
PM Project Manager
PO Procurement Officer
PST Project Supervision Team
PT Project Team
PWD Public Works Department
QA Quality Audit / Quality Auditor
QSCD Quantity Surveying and Contracts Division
SO Superintending Officer;in DID Manual Volume 10, the term SO may include Project Director (PD) of adesign and build contract unless the context requires otherwise.
SOR S.O. Representative;in DID Manual Volume 10, the term SOR may include Project Director’s
Representative (PDR) of a design and build contract unless the context requiresotherwise
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Volume 10 DID MANUAL
List of Abbreviations(English)
QS Quantity Surveyor
TI Treasury Instruction
TS Tender Secretariat
VO Variation Order
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DID MANUAL Volume 10
List of Abbreviations(Bahasa Malaysia)
AK Audit Kualiti(Quality Audit)
AP Arahan Perbendaharaan(Treasury Instruction)
APK Arahan Perubahan Kerja(Variation Order)
BUBK Bahagian Ukur Bahan dan Kontrak (Quantity Surveying and Contracts Division)
JKR Jabatan Kerja Raya.
(Public Works Department)
JPS Jabatan Pengairan dan Saliran.(Department of Irrigation and Drainage)
KPK Kelulusan Perubahan Kerja(Variation Approval)
PHK Pelarasan Harga Kontrak (Adjustment of Contract Sum)
PK Perubahan Kerja
(Variation)
PMK Pegawai Mentadbir Kontrak (Contract Administration Officer)
SPJPS Surat Pekeliling JPS(DID Circular)
SPP Surat Pekeliling Perbendaharaan.(Treasury Circular)
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DID MANUAL Volume 10
Glossary
Term Definitioni
Addendum(Addenda)
Written information adding to, clarifying or modifying the tender documents. An addendum is generally issued by the Government to the contractor duringthe tender process and as such, addenda are intended to become part of thecontract documents when the construction contract is executed.
Advancepayment
Prepayment, payment made on account, in advance of the commencement of works, supply or services.
Advancepaymentguarantee
Guarantee submitted by a party receiving an advance payment to theGovernment, for advancing the payment. It provides that the advanced sumwill be returned if the agreement under which the advance was made cannotbe fulfilled.
Alternativetender
An alternative tender is a tender that offers an alternative proposal that stillsatisfies the Government's requirements. Alternative tenders will not beconsidered unless they are allowed in the conditions of tendering.
As-BuiltDrawings
Drawings (plans) that show the work, as actually installed.
Audit An independent examination of a work product or set of work products toassess compliance with procedures, specifications, standards, contractualagreements, or other criteria.
Award Acceptance of a tender or proposal for a contract.
Best practice The most effective and desirable method of carrying out a function or processderived from experience rather than theory.
Best value Continuous improvement in the exercise of all functions undertaken by theGovernment, whether statutory or not, having a regard to economy, efficiencyand effectiveness.
Bid See ‘Tender’.
Bidder See ‘Tenderer’.
Bill of Quantities A document usually prepared by a quantity surveyor which (ideally) details theterms and conditions under which a contract is to be let, and itemises all worksto enable a contractor to price the work for which he is tendering. The firstmain step in preparing a bill is the "taking off" or recording of dimensions fromdrawings or schedules of work. Similar types of work are then brought togetherunder one item, a process known as "abstracting", all of this information isthen "worked up" into the bill of quantities.
Build-own-operate (BOO)
A mode of business in which a project company builds and operates a propertyproject pursuant to the concession rights granted by the government
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Volume 10 DID MANUAL
Glossary
Term Definitioni
Build-operate-transfer (BOT)
A mode in which Government or local authorities grant the rights to anenterprise by concession agreement to undertake the financing, construction,operation and maintenance of a construction project. Upon expiry of theconcession period, the relevant facilities will be transferred back to thecontracted government authorityat (usually) nil consideration.
Build-transfer A variant of build-operate-transfer (BOT) in which the contractor undertakesthefinancing of construction expenditures and transfers the project back to theproprietor upon completion and inspection for acceptance. The proprietor willcompensate the contractor for such construction expenditure and Financing
costs in installments pursuant to agreement.
Bond See ‘Guarantee’.
Certificate of payment
See ‘Payment certificate’.
Certificate of practicalcompletion
Document that confirms the stage reached in the contract where theGovernment can take beneficial occupation and/or utilise the works for itsintended use, without undue interference.
Claim A written demand or assertion by a contractor seeking adjustment orinterpretation of the terms of the contract documents, payment of money,extension of time, or other relief with respect to the contract documents, ordetermination of other disputes or matters in question between theGovernment and contractor regarding the contract documents or theperformance of the work.
Claimscommittee
The group of officers who are authorised under the Government procurementprocedures to approve claims submitted by a contractor.
Closed tender Competitive tendering in which the tender-opening is conducted at a privatevenue, and in the presence only of the authorised personnel of the partyrequesting the tenders, ie officers of the Government.
Close out The completion of project work once the project has been implemented. Thephase at the end of the project lifecycle just before the operations begin.
Competitivetender
See ‘Open tender’.
Completion See ‘Practical completion’.
Compliance Certification or confirmation that the doer of an action (such as the writer of areport), or the manufacturer or supplier of a product, meets the terms of acontract; or the requirements of accepted practices, legislation, prescribedrules and regulations, specified standards. See also conformance.
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DID MANUAL Volume 10
Glossary
Term Definitioni
Conceptualdesign
The first of three sub-phases of the design phase. The design professionalascertains the requirements of the project and prepares design studiesconsisting of drawings and other documents illustrating the scale andrelationships of the project.
Conditions of contract
Terms and conditions that set the rights and obligations of the contractingparties, when a contract is awarded or entered into. These include 'generalconditions' which are common to all types of contracts, as well as 'specialconditions' (or special provisions) which are peculiar to a specific contract (suchas variation of price clauses).
Conditions of
tendering
The rules governing what the tender submission should contain, how it should
be submitted, and how it will be evaluated. There are general conditions of tender for building and construction that apply to all tenders, such as treatmentof late tenders. Pro-forma conditions of tender for the purchase of goods andservices are provided under Resources / Publications. Pro-forma conditions of tender for the procurement of works, supplies and services are provided by theGovernment.
Conformance Certification or confirmation that a good, service, or conduct meets the termsof a contract; or the requirements of legislation, accepted practices, prescribedrules and regulations, specified standards. See also compliance.
Consultant A particular type of contractor who is engaged to provide recommendations orspecialist or professional advice (or more generally non-manual services) toassist or influence Government’s decision making.
Contingency An amount of money reserved by the Government (project manager) forunforeseen changes in the work
Contract A mutually binding, legal relationship obligating the seller to furnish supplies orservices, and the buyer to pay for them.
Contractadministration
Administrative activities usually associated with handling of contracts, such as(1) invitation to tender, (2) tender evaluation, (3) award of contract, (4)contract implementation, (5) measurement of work completed, and (6)
computation of payments. It also includes monitoring contract relationship,addressing related problems, incorporating necessary changes or modificationsin the contract, ensuring both parties meet or exceed each other'sexpectations, and actively interacting with the contractor to achieve thecontract's objective(s). Also called contract management.
Contractdocuments
Executed (signed) agreements, supplementary conditions, drawings,specifications, and other documents specific to a contract.
Contract period Number of working days or calendar days, calculated from a specifiedcommencement date to a specified date for completion, as provided for in acontract. For works contract, also called construction period.
Contractmanagement
See ‘Contract administration’.
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Volume 10 DID MANUAL
Glossary
Term Definitioni
Contract price See ‘Contract sum’.
Contract priceanalysis
See ‘Contract sum analysis’.
Contract sumanalysis
Examination of a cost proposal in view of the supporting data, and by applyingappropriates rates and factors.
Contractor Independent entity that agrees to furnish certain number or quantity of goods,material, equipment, personnel, and/or services that meet or exceed statedrequirements or specifications, at a mutually agreed upon price and within aspecified timeframe to the Government.
Contract sum Mutually agreed upon total amount that a principal (Government) pays to acontractor on completion of the contract, in accordance with contract termsand conditions and their subsequent modifications (if any).
Contractualliability
Obligation assumed by any contracting party under the terms of a contract.
Cost estimate Approximation of the probable total cost of a product, program, or project,computed on the basis of available information. Four common types of costestimates are: (1) Planning estimate: rough approximation of cost within areasonable range of values, prepared for information purposes only. Also calledball park estimate. (2) Budget estimate: approximation based on well defined
(but preliminary) cost data and established ground rules. (3) Firm estimate:based on cost data sound enough for entering into a binding contract. (4) Not-to-exceed /Not-less-than estimate: maximum or minimum amount required toaccomplish a given task, based on firm cost estimate.
Date forcompletion
Fixed date specified in a contract to complete a job or project. If permittedunder the terms of the contract, the date for completion may be modified orrevised.
Date of commencement
The date established in a written notice to proceed with the works, from theGovernment to the contractor.
Deliverable Report, document or item that must be completed and delivered under theterms of an agreement or contract.
Design Application of engineering or architectural theories and techno-economicapproaches, based on the prevailing technical standards, for conducting all-round design (including non-standardized equipment design) andtechnoeconomic analysis on newly constructed, expansion and reconstructionprojects in respect of their technical process, land construction, civil works andenvironmental works; provision of design papers and blueprints as the basis forconstruction work.
Design andbuild (DB)contract
Construction contract where both the design and the construction of astructure are the responsibilities of the same contractor.
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DID MANUAL Volume 10
Glossary
Term Definitioni
Design-build-operate (DBO)contract
Construction contract where a single contractor has the responsibility fordesigning and constructing a facility, as well of operating and maintaining it fora specified period prior to handing it over to the client or principal.
Designdevelopment
A project design phase in which all design decisions need to be completed. Thedesign professional (designers) further develops the preliminary (schematic)design and detailing and ensures that basic technical issues are resolved andare capable of technical description. Plan arrangements, specific spaceaccommodations, plant equipment and furnishings, building design, materialsand colors, and complete definitions of systems serving the project aredeveloped.
Designer The professional individual or organisation that performs the design andprepares plans and specifications for the work to be performed. Theprofessional can be an architect, an engineer, or an organisation whichcombines professional services.
Design-tender-build
Traditional contracting method in which design is carried out by theGovernment (or tendered and performed by design consultant), and theconstruction phase are tender and performed by contractor.
Detailed design The phase of the design process on a project when drawings and specificationsare completed for construction tender purposes. The phase is preceded by thepreliminary design phase, and followed by the tender and award phase.
Direct costs The field costs directly attributed to the construction of a project, includinglabor, material, equipment, subcontracts and their associated costs.
Drawings A term used to represent that portion of the contract documents thatgraphically illustrates the design, location and dimensions of thecomponents and elements contained in a specific project.
A line drawing.
Engineering,procurementandconstruction
(EPC)
Commissioned by the Government to contract the whole process or certainstages of a project based on the contract including exploration, design,procurement, construction and trial operations (inspection upon completion)
Escalationclause
See ‘Variation of price clause’.
Estimate To calculate approximately the amount, extent or value of something To form an opinion of estimated costs
EvaluationCriteria
Evaluation criteria are used to assess the merit of offers/tenders received. Theevaluation criteria are specified in the quotation or tender documentation.
Extension of time
An extension of time to a contract period authorised by the Government forreasons of adverse weather conditions, an unusual number of variations etc.The reasons for which an extension of time may be granted are usually given inthe conditions of contract.
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Volume 10 DID MANUAL
Glossary
Term Definitioni
Fair andreasonable price
A price that is fair to both parties considering quality, performance, supplysituation, delivery time, and payment options.
Fast track The process of dividing the design of a project into phases in such a manner asto permit construction to start before the entire design phase is complete. Theoverlapping of the construction phase with the design phase.
Final certificate A certificate stating that the works are now complete and the Government isdue a full and final settlement to the contractor.
Final payment The last payment from the Government to the contractor of the entire unpaidbalance of the contract sum as adjusted by any approved variation orders or
other contractual adjustment to the contract sum.
Firm price See ‘Fixed price’
Firm pricecontract
See ‘Fixed price contract’
Fixed price A price which is not subject to variation.
Fixed pricecontract
Contract that provides for a price which normally is not subject to anyadjustment unless certain provisions (such as variation of price clause) areincluded in the agreement.
Fluctuations Increases or decreases in costs of labour and materials.
Force majeure Standard clause found in construction and supply contracts, it exempts thecontracting parties from fulfilling their contractual obligations for causes thatcould not be anticipated and/or are beyond their control. These causes usuallyinclude act of God, act of man, act of parliament, and other impersonal eventsor occurrences. (French for, superior force.)
Form of tender Standard printed form given or sold to tenderers so that they may submit theinformation required for evaluation of the tender, in correct format andsequence.
Generalcontractor
Contractor that performs a contract all by itself, or through the use of subcontractors whose activities it supervises and coordinates.
Guarantee Three-party contingent liability agreement under which a third-party (theguarantor; usually bank or insurance company) agrees to be directly orcollaterally responsible for the obligation (contract fulfillment) of a first-party(the principal; usually the contractor) to a second-party (beneficiary; ie theGovernment) in case the first-party defaults or fails to fulfill its part of a deal.Unlike a warranty, a guarantee may refer to things as well as persons and, tobe legally enforceable, must be in writing.
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DID MANUAL Volume 10
Glossary
Term Definitioni
Invitation totender (ITT)
Initiating step of a competitive tendering process in which qualified (or pre-qualified) contractors or suppliers are invited to submit sealed tenders forconstruction works or for supply of specific and clearly defined goods orservices during a specified timeframe.
Lead time The period of time between when the contractor receives the order and theGovernment receives the goods/services.
Letter of acceptance
A letter that creates an immediate binding contractual relationship between theGovernment and the successful tenderer prior to entering into a formalcontract.
Letter of intent A letter informing a successful tenderer that it is the Government’s intention toenter into a contract with them in the future but creates no liability in regard tothat future contract
Liquidated andascertaineddamages (LAD)
A fixed sum that is specified in the contract and which the contractor isassessed as a measure of damages that the Government will suffer for eachday the work remains incomplete beyond the expiration of the contract time.The sum usually stated a daily rate is recovered from the contractor. The rateof LAD should be reasonable, and justifiable under the circumstances.
Liquidateddamages
See ‘Liquidated and ascertained damages’.
Lump sum A fixed price for contract work, not intended to be adjusted in any way eitherby variation or remeasurement. A lump sum contract therefore is a contract foran agreed amount of work for a lump sum of money.
Lump sumcontract
Written agreement under which the Government agrees to pay a contractor aspecified amount, for completing an agreed scope of work (e.g. involving avariety of items of work which are based on drawings and specifications set outin the contract) without requiring a measurement of quantities involved.
Main contractor Chief contractor who has a contract with the Government, and has the fullresponsibility for its completion. A main contractor undertakes to perform acomplete contract, and may employ (and manage) one or more subcontractors
to carry out specific parts of the contract.
Method of procurement
Procedure used in converting requirements or requisitions into purchase ordersor contracts. Methods of procurement include (1) open competitive tender, (2)selective competitive tender, (3) direct negotiations, and (4) direct purchasefrom internal pool of contractors/suppliers.
Needsstatement
See ‘Specifications’.
Negotiatedcontract
Contract awarded on the basis of a direct agreement with a contractor, withoutgoing through the competitive tendering process.
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Volume 10 DID MANUAL
Glossary
Term Definitioni
Nominated sub-contractor
A contractor whom the main contractor usually employs under instruction fromthe Government pursuant to terms of the contract. Usually contractors forspecialist works, such as mechanical and/or electrical works.
Nominatedsuppliers
A supplier whom the main contractor usually employs under instruction fromthe Government pursuant to terms of the contract. Usually suppliers of goodsnot widely available such as some plant/equipment or a particular brand of plant/equipment which the designer considers is the most suitable for theparticular job.
Non-completion Not practical completion. See ‘Practical completion’
Non-compliance Not compliance. See ‘Compliance’.
Non-conformance
Not conformance. See ‘Conformance’.
Notice of tender Document used in sealed-tender procurement procedures through which theGovernment advises the potential suppliers of (1) statement and scope of work, (2) specifications, (3) schedules or timelines, (4) contract type, (5) datarequirements, (6) terms and conditions, (7) description of goods and/orservices to be procured, (8) general criteria used in evaluation procedure, (9)special contractual requirements, (10) technical goals, (11) instructions forpreparation of technical, management, and/or cost proposals. Notices of tenderare publicly advertised and contractors/suppliers respond with a detailedtender, not with only a price quotation. They provide for negotiations aftersealed tenders are opened, and the award of contract may not necessarily goto the lowest tenderer.
Open tender Tender process that is open to all qualified tenderers and where the sealedtenders may be opened in public for scrutiny and are chosen on the basis of price and quality. Also called ‘competitive tender’ or ‘public tender’.
Tender submitted in response to open competitive tender request/invitation.
Paymentcertificate
Document verified by an officer of the Government (usually the ‘SuperintendingOfficer’ named in the contract) that the noted work has been completed and isapproved for payment by the Government to the contractor.
Performancebond
Written guarantee from a third party guarantor (usually a bank or an insurancecompany) submitted to a principal (i.e. the Government) by a contractor onwinning the tender. Performance bond ensures payment of a sum (notexceeding a stated maximum) of money in case the contractor fails in the fullperformance of the contract. These bonds usually cover 100 percent of thecontract price and replace the tender bonds on award of the contract.
Post tenderclarification
Discussions between the Government with the prospective contractors(suppliers), after the receipt of tenders but before the award of contract. Thesenegotiations are supposed to be confined to clarification of any points; pricechanges are normally ruled out.
Post tendernegotiation
See ‘Post tender clarification’
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DID MANUAL Volume 10
Glossary
Term Definitioni
Practicalcompletion
Stage or designated portion of a construction project that is sufficientlycomplete in accordance with a contract for the Government to occupy and/orutilise it for its intended use, without undue interference.
Preliminaries Matters which feature at the beginning of a bill of quantities or summary of tender, which are relevant to the contractor in terms of his obligations andresponsibilities and which will therefore influence his costings. These wouldinclude such items as names of clients and consultants, insurancerequirements, length of contract, descriptions of the site in terms of its access,working areas and adjacent buildings etc, a detailed description of the work tobe undertaken and the order in which it should be tackled.
Preliminarydesign
The second phase of a project's design process. During this phase ancillaryspace is developed and dimensions are finalized. Outline specifications aredeveloped into technical specifications; sections are delineated and elevationsare defined.
Pre-qualification Preliminary stage in a tender process where it is determined if an applicant hasthe requisite resources and experience to complete the job as required.
Pre-qualificationof tenderers
Screening of potential contractors, suppliers, or vendors (on the basis of factorssuch as experience, financial ability, managerial ability, reputation, work history, etc.) to develop a list of qualified tenderers who will receive the letterof invitation to tender.
Prime cost sum An amount included in a bill of quantities or summary of tender to cover aparticular bit of work or supply of materials to be carried out by a nominatedsub-contractor or a supplier.
Project The erection, construction, alteration, repair, or improvement of any plant,structure, building, road, or other improvement.
Projectmanagement
The use of integrated systems and procedures by a team of professionalsduring project design and construction. As applied to a construction project,project management can be used synonymously with constructionmanagement.
Provisional sum A sum included in a bill of quantities or summary of tender for work that isrequired but cannot be sufficiently designed or specified at the outset of thecontract.
Private financeinitiative (PFI)
A form of partnership between the private and public sector which is normallyused for high risk/high value contracts, principally to raise money for highervalue projects
Procurement The process of obtaining work, supplies and services - covering acquisitionfrom third parties and from in-house providers - from preparation andprocessing of a requisition through to approval of the invoice/claim forpayment. The process spans the whole life cycle from identification of needs,through to the end of a services contract or the end of the useful life of anasset.
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Glossary
Term Definitioni
Procurementboard
The group of officers who are authorised under the Government’s procurementprocedures to approve the award of a particular tender to acontractor/supplier.
Professionalindemnityinsurance
Consultants arrange insurance to cover their liability for damages and costs dueto breaches of their professional duty caused by neglect, error or omission. Italso covers costs of liability and their defence arising out of dishonest orfraudulent acts. Insurers usually reserve their right to take all reasonable stepsof recovery against any party. Contractors with a design responsibility will alsobe required to obtain such insurance.
Public liability
insurance
The insurance taken out by the contractor for third party claims. Under the
contract the contractor is usually required to indemnify the Government for anyexpense, loss, liability, claim or proceedings under statute or common law inrespect of which personal injury or death is caused by the carrying out of theworks other than that caused by the act or neglect of the employer.
Additionally, the contractor is usually required to insure his obligation toindemnify the Government for any damage to property to the extent that it isdue to negligence of the contractor.
Public privatepartnership(PPP)
Very similar to a PFI arrangement, but the aim is centered more on servicedelivery than finance.
Public tender See ‘Open tender’.
Purchasing Also known as procurement, purchasing is the acquisition of goods or services.
Qualifiedtenderer
Potential tenderer who meets the minimum standards of experience, financialability, managerial ability, reputation, and work history for a specified class of supplies, services, or projects (works).
Quotation Formal statement of promise (submitted usually in response to a request forquotation) by potential supplier to supply the goods; or services required by abuyer; or works required by a contractor; at specified prices, and within aspecified period. It may also contain terms of sale and payment, andwarranties. Acceptance of quotation by the Government constitutes an
agreement binding on both parties.
Reasonableprice
Price that provides the best total value—comprising of availability, deliverytime, fitness for purpose, payment terms, quality, quantity, and service. A reasonable price is not necessarily the lowest price.
Rejected tender Response to an invitation to tender that is unacceptable, because (1) anothertender has been chosen, (2) tender fails to fall within the establishedcompetitive range, (3) absence of competitive tenders invalidates the tenderingexercise, (4) invitation to tender is readvertised, (5) tender is void due toirresponsibility of the tenderer, or rigging or other fraud is discovered.
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DID MANUAL Volume 10
Glossary
Term Definitioni
Request forinformation
Request made typically during the project planning phase where a Governmentcannot clearly identify product requirements, specifications, and purchaseoptions. Such requests clearly indicate that award of a contract will notautomatically follow.
Request forquotation (RFQ)
Document used in soliciting price and delivery quotations that meet minimumquality specifications for a specific quantity of specific goods and/or services.RFQ are usually not advertised publicly, and are used commonly for (1)standard, off-the-shelf items, (2) items built to known specifications, (3) itemsrequired in small quantities, or (4) items whose purchase price falls belowsealed-tender threshold. Suppliers respond to a RFQ with firm quotations, andgenerally the lowest-priced quotation is awarded the contract.
Retentions An amount, usually 5-10% held back from the sum due to a contractor, forpayment at a later date. The amount will be specified in the conditions of contract. Retentions are usually released on the basis of half at the issue of thecertificate of practical completion, the remainder at the issue of the finalcertificate. Note: the Government of Malaysia’s forms of contract do notrequire retentions.
Retention fund See ‘Retentions’.
Retention sum See ‘Retentions’.
Risk Factors that may adversely affect the successful completion of a project.
Schedule of rates
A list of works activities or items usually priced at a rate per unit.
Schematicdesign
See ‘Preliminary design’.
Scope of work Description (usually in chronological division) of work to be performed under acontract or subcontract in the completion of a project.
Sealed tender Document enclosed in a glued (sealed) envelope and submitted in response toinvitation to tender (ITT). Sealed tenders received up to the deadline date are
generally opened at a stated time and place, and evaluated for award of acontract.
Selective tender Invitation to tender sent only to selected contractors, sellers, or vendors whohave been pre-qualified through a screening process.
Specialprovisions toconditions of contract
Conditions of a contract that are peculiar to the project under considerationand do not fall under the general conditions.
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Glossary
Term Definitioni
Specification A description of requirements and standards to which the goods, works orservices should conform. Also known as a statement of needs (needsstatement), a statement of requirement, an operational requirement, or a brief.Its purpose is to present prospective contractors/suppliers with a clear,accurate and full description of the Government’s needs, to enable them topropose a solution to meet them
Stakeholder An individual or organisation that has an active interest or a stake in aparticular organisation or issue. For example, funders, members, contractors,purchasers, trustees, beneficiaries, volunteers and paid staff are allstakeholders in a voluntary organisation
Sub-contract Agreement, purchase order, or any such legal instrument issued under a maincontract (by the main contractor to a third party—the subcontractor), callingfor the performance of a defined piece of work or production and/or delivery of specified goods or services. Subcontracts contain special terms and conditionsthat are unique to the main contract, and flow-down provisions that proceedfrom it.
Sub-contractor Junior or secondary contractor who contracts with a main contractor (and notthe Government) to perform some or all of the main contractor's contractual-obligations under the main contract.
Summary of tender
Lists of jobs, like those in bills of quantities except that they contain noquantities. Rates may be inserted by tenderers
Supplementaryagreement
Document that describes additions, alterations, or removal, of the scope (or theterms) of a contract, mutually agreed upon by the parties to the contract.
Supplementarycontract
See ‘supplementary agreement’.
Supplier An individual or firm who supplies and/or fabricates goods, materials orequipment for a specific portion of a construction project but does notperform any labor on the project.
One that sells goods, materials or equipment not fabricated to a specialdesign.
Survey Survey, explore, test, and undertake overall assessment on landscape, geologyand water for planning, design, implementation, operations and integratedmanagement of the project; provide feasibility assessment and requiredinformation on the exploration results for construction; carry out rock exploration, design, management and monitoring activities.
Tender Complete proposal (submitted in competition with other tenderers) to executespecified work(s) within prescribed time, and not exceeding a proposed amount(that usually includes labor, equipment, and materials). The tender-receivingparty may reject the tender, make a counter offer, or turn it into a bindingcontract by accepting it. See also offer and proposal.
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DID MANUAL Volume 10
Glossary
Term Definitioni
Tender bond Written guarantee from a third party guarantor (usually a bank or an insurancecompany) submitted to a principal (eg Government) by a contractor (tender)with a tender. Tender bond ensures that on acceptance of tender by theGovernment the contractor will proceed with the contract and will replace thetender bond with a performance-bond. Otherwise, the guarantor will pay theGovernment the difference between the contractor's tender and the nexthighest tenderer. This difference is called liquidated damages which cannotexceed the amount of the tender bond. Also called tender guarantee or tendersurety.
Tender box Box where tender documents (or proposal) must be lodged by the tender dateto be eligible for consideration.
Tender date Prescribed date and time by which a tender must be submitted (or lodged inthe tender depository) to be considered. Also called tender time.
Tenderdocuments
Documents required to be submitted in response to an invitation to tender.These include the prescribed tender form, drawings, specifications, time lines,charts, price breakdowns, etc. Tenders not accompanied by all the requireddocuments are considered incomplete or non-compliant tenders, and areusually automatically rejected.
Tenderer Contractor, supplier, or vendor (services provider) who responds to aninvitation to tender. Also called offeror or quoter.
Tenderevaluation
The formal process of examining contractor’s (or supplier’s) tenders to identifywhich provides best “value for money”.
Tenderevaluationcommittee
The group of officers who are authorised under the Government procurementprocedures to analyse received tenders. They also make recommendations onwho is awarded the contract.
Tender form See ‘Form of Tender’
Tenderguarantee
Alternative term for tender bond.
Tender opening Stage in a tender process where the received tender-envelopes are opened andexamined by the advertiser (ie the Government ) of an invitation to tender(ITT). In an open or public tender opening, the tenderers (and other parties)are allowed to witness the process and inspect the tenders, in a closed openingonly the officers of the Government are present.
Tender openingcommittee
The group of officers who are authorised under the Government’s procurementprocedures to witness, administer and record the tender opening process.
Tender price Price offered by tender (contractor, supplier, vendor) for a specific work, supplyor service, and valid only for the specified period.
Turnkeycontractor
A contractor who is responsible for the whole process of design, procurement,construction and installation work in a project. When transferred to theGovernment, a turnkey project is fully ready for use.
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Volume 10 DID MANUAL
Glossary
Term Definitioni
Valueengineering
A process of reviewing all aspects of a design to re-examine all assumptionsand minimize the life-cycle costs of the project.
Value for money Utility derived from every purchase or every sum of money spent. ‘Value formoney’ is based not only on the minimum purchase price (economy) but alsoon the maximum efficiency and effectiveness of the purchase.
Variation Changes in work permitted under the contract. See also ‘Variation order’.
Variation of price clause
Provision in a contract for increasing or decreasing the contracted price forlabor, material, etc., in step with an agreed upon benchmark such as the costindex issued by the Department of Statistics.
Variation order(VO)
Document issued by the Government, directing variations (changes) in acontract as authorised under the contract's variation clause.
Variation ordercommittee
The group of officers who are authorised under the Government’s procurementprocedures to approve variation of works under a contract.
Work Construction and services required by the contract documents, as amended bycontract modifications, whether completed or partially completed, including alllabor, materials, equipment, tools, and services provided or to be provided bythe contractor to fulfill the contractor's obligations. The work may constitutethe whole or part of the project.
_______________________
Part of the items in the Glossary was extracted / modified from: www.businessdictionary.com.
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART I : INTRODUCTION
CHAPTER 1
INTRODUCTION
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Chapter 1 – INTRODUCTION
1-iRevision 0 : March 2009
Table of Contents
Table of Contents ..................................................................................................................... 1-i
1.1 INTRODUCTION.......................................................................................................... 1-1
1.2 SCOPE OF VOLUME 10................................................................................................. 1-1
1.3 CONTENTS OF VOLUME 10 .......................................................................................... 1-1
1.3.1 Part I : Introduction........................................................................................1-1
1.3.2 Part II : Pre-contract.......................................................................................1-1
1.3.3 Part III : Post-contract ....................................................................................1-1
1.4 DOCUMENT BINDING, AND UPDATES............................................................................1-2
1.5 FLOWCHARTS, PROCEDURES, GUIDELINES, AND APPENDICES ......................................1-2
1.5.1 Flowcharts...................................................................................................... 1-2
1.5.2 Procedures .....................................................................................................1-2
1.5.3 Guidelines / Guidance Notes ............................................................................1-2
1.5.4 Reference Documents .....................................................................................1-2
1.5.5 Appendices..................................................................................................... 1-3
1.5.6 References .....................................................................................................1-3
1.5.7 Volume 10A – Reference Documents................................................................1-3
1.6 DOCUMENT CHANGE CONTROL AND APPROVAL ............................................................1-3
APPENDIX 1A Pro-Forma : Document Change Control / A pproval.......................................... 1A-1
APPENDIX 1B Pro-Forma : Amendment Record Sheet for Revision ........................................1A-2
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1-1Revision 0 : March 2009
1 INTRODUCTION
1.1 INTRODUCTION
This chapter provides:
An overview of the scope, contents and document structure of Volume 10. Procedures on updating the document.
1.2 SCOPE OF VOLUME 10
Volume 10 covers all general procedures and practices pertaining to contract administration,commencing from tender stage until the completion of defects liability stage.
It is aimed to be the first point of reference for all matters pertaining to DID contract procedures,e.g.
the tender processes, the compilation of contract documents, contract administration, and close-out for the contracts.
1.3 CO NTE NTS OF V OLUME 10
The chapters within the Volume 10 are grouped to 3 parts, and covering subjects, as follows:
1.3.1 Part I : Introduction
Part I gives a whistle-stop tour of the whole DID organization structure and procurement processes,
including an outline on project implementation.
It serves as background information only.
1.3.2 Part II : Pre-contract
Although pre-contract works are usually not considered as ‘contract administration’, it is part of theprocurement process and included in Volume 10 for ease of reference.
Part II covers the DID general procurement processes, and the procedures for preparation of tenderdocuments (for works) up to the acceptance of tender (or award of contract).
1.3.3 Part III : Post-contract
Post-Contract administration can be defined as the coordination of the actions required for theperformance of the contract, including guidance and monitoring necessary to assure that allcontractual obligations are fulfilled by the parties to the contract, i.e. the Department of Irrigationand Drainage (representing the Government) and the Contractor.
Part III covers the contract administration procedures and best practices.
It also includes explanatory notes on contractual issues such as delays and extension of time,practical completion and disputes resolution.
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Chapter 1 – INTRODUCTION
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1.4 DOCUMENT BINDING, AND UPDATES
Volume 10 is a “live document” and shall be updated from time to time.
For this purpose, the document is ring bound.
Upon receipt of a document change notification, the superseded page/document shall be removedand replaced by the new page/document.
Changes must be recorded in the ‘Registration of Amendments’ sheet at the front of the Volume.
1.5 FLOWCHARTS, PROCEDURES, GUIDELINES, AND APPENDICES
Where applicable, the information are presented in the following manner and order:
1.5. 1 Flo wcha rts
The flowchart provides an overview of the processes set out within the chapter, and the sequenceand interrelationship between the processes.
1.5. 2 Pr ocedur es
The procedures section describes work processes outlined in the flowchart.
1.5.3 Guidelines / Guidance Notes
The guidelines or guidance notes on contract administration practices are set out after theprocedures. These shall be presented in bullet-point format, as far as possible.
The guidelines or guidance notes are summaries only. For further details, reference must be made
to the relevant and current DID Circulars, Treasury Circulars and Treasury Instructions. See ‘References’.
1.5.4 Reference Documents
A list of Reference Documents is included in each chapter. Reference documents are
- sample do cuments- and other documents
as may be relevant to the chapter.
The Reference Documents are compiled under Volume 10A – Reference Documents.
Comment [scho1]: “”list of sample docu
(which are compiled under Volume 10A’ d
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1-3Revision 0 : March 2009
1.5.5 App endices
The Appendix or Appendices are appended at the end of each chapter, and generally includechecklist(s) of work processes relating to that chapter.
1.5.6 References
A list of the relevant DID Circulars, Treasury Circulars and Treasury Instructions are included at theend of each chapter.
1.5.7 Volume 10A – Reference Documents
Sample documents or pro forma documents are set out in Volume 10A of the DID Manual.
1.6 DOCUMENT CHANGE CONTROL AND APPROVAL
An officer may propose changes to the contents or procedures set out in Volume 10, by using theDocument Change Control Form.
The officer should state the proposed amendments together with reasons for the amendments in the Amendment Record Sheet.
Upon approval, the new document shall be inserted, and the Registration of Amendments sheet atthe front of the Volume 10 must be updated.
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 1
– Introduction to Volume 10
APPENDIX 1A
Pro-Forma- Document Change Control / Approval
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Chapter 1 – INTRODUCTION
APPENDIX 1A PRO-FORMA : DOCUMENT CHANGE CONTROL/APPROVAL
TO :…………………………………………….
CHANGE REQUEST
DOCUMENT REFERENCE PROPOSED AMENDMENT
DID MANUAL VOLUME 10
................................................................... ........................................[OFFICER] Date
Name :Designation:Contact No :
APPROVAL RECORD
Approved for Implementation Not Approved
Remarks :
.................................................................[APPROVING OFFICER]
Name :Designation:Contact No :
..............................….......Date
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 1
– Introduction to Volume 10
APPENDIX 1B
Pro-Forma- Amendment Record Sheet for Revision
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Chapter 1 – INTRODUCTION
APPENDIX 1B AMENDMENTS RECORD SHEET FOR REVISION
AMENDMENT RECORD SHEET FOR REVISION : _______
TO:……………………………………….
The amendment enclosed herewith is the revision to your DID Manual.
DOCUMENTS ISSUED
REMOVE INSERT AMENDMENT/DOCUMENTED
PROCEDURE
REASON FOR AMENDMENT/
DOCUMENTEDPROCEDURE
Volume 10, Chapter ……….
Page ____ toPage ___, Rev.
___
Page ___ toPage ___, Rev. ___
Attachment ___,Page ___ to Page
___ , Rev. ___
Attachment ___,Page ___ to Page
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Volume 10, Chapter ……….
Page ____ toPage ___, Rev.
___
Page ____ toPage ___, Rev. ___
Attachment ___,Page ___ to Page
___ , Rev. ___
Attachment ___,Page ___ to Page
___ , Rev. ___
After Revision : ____ has been inserted, please complete the Registration of Amendments Sheet on
Page ___ of your Manual.
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART I : INTRODUCTION
CHAPTER 2
DID ORGANISATION STRUCTURE
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Chapter 2 – DID ORGANISATION STRUCTURE
Table of Contents
Table of Contents .......................................................................................................................2-i
List of Figures ...........................................................................................................................2-ii
2.1 INTRODUCTION ............................................................................................................. 2-1
2.2 BACKGROUND................................................................................................................ 2-1
2.3 CORPORATE INFORMATION............................................................................................ 2-2
2.4 ORGANISATION STRUCTURE .......................................................................................... 2-3
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Chapter 2 – DID ORGANISATION STRUCTURE
List of Figures
Figure Description Page
Figure 2.1 Organisation Chart 2-4
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Chapter 2 – DID ORGANISATION STRUCTURE
2 DID ORGANISATION STRUCTURE
2.1 INTRODUCTION
This chapter provides:
Brief history and background information of the DID. An overview of the organisation structure of the DID.
2.2 BACKGROUND
"It was the vital need for irrigation facilities - to open new areas for a fledging paddy growingindustry - that provided the impetus for the establishment of the Department of Irrigation andDrainage or the DID as it is popularly known."
Prior to the formation of DID in 1932, all works in connection with drainage and irrigation was
related to by the Public Works Department. Following the slump in the tin and rubber industries inthe late twenties and the worsening rice situation in the country, the then British High Commissionerappointed in 1930 a Rice Cultivation Committee to determine "the best steps to be taken in order toencourage rice cultivation in Malaya".
The Committee made a comprehensive survey and published its report in 1931. One of its mainrecommendations was "that an Irrigation and Drainage Department should be established which willexecute in the Straits Settlement and Federated Malay States and advisory in the Unfederated MalayStates, which will absorb the Hydraulics Branch of the Public Works Department, Federated MalayStates". This recommendation was accepted as a separate department on the 1st. of January 1932.
During the first 10 years of the Department's existence up to the Japanese occupation, 20,000
hectares of new padi land were developed and improved, irrigation and drainage facilities wereprovided to some 50,000 hectares of existing padi lands. The Department took over the maintenanceof drainage works on 40,000 hectares of estate and smallholder lands in Selangor and Perak.
Reconstruction of these works and their extension raised the total area to about 80,000 hectares in1942. During the Japanese Occupation, little or no new development took place apart from thecompletion of some structures that were partly finished when the war broke out. In the drainageareas, neglect resulted in drains being silted up and overgrown with plants, and in some instancesalmost entirely filled up.
On the re-occupation of Malaya in 1945, emphasis was given to the rehabilitation of irrigation works.The established policy of the Government was to reduce the country's dependence on imported foodsupplies, with emphasis towards self-sufficiency in rice, and every effort was made to increase thelocal production of rice. Following the Independence of Malaya in 1957, greater emphasis was placedon increasing the income and employment opportunities of the rural poor.
With this objective, the irrigation and drainage programmes were formulated to provide adequateirrigation facilities to enable double cropping of padi lands, and drainage facilities for improvedproduction of tree crops especially in small holdings.
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Chapter 2 – DID ORGANISATION STRUCTURE
Subsequent to the formation of Malaysia in 1963, additional State Drainage and IrrigationDepartments were established in Sabah and Sarawak and this increased the number of StateDepartments to thirteen with the Federal Headquarters being responsible for the overall drainageand irrigation matters in the country. The significant increase in development since 1957 is reflectedin the areas provided with irrigation facilities increasing from 205,000 hectares (3,000 hectares with
double cropping facilities) to 332,000 hectares (249,000 hectares with double cropping facilities) bythe end of 1981. The areas provided with drainage facilities, too, has increased from 142,000hectares to 476,000 hectares in the same period.
In 1970/71, severe floods occurred in many parts of West Malaysia and the situation was so seriousthat a national disaster had to be declared on January 5th. 1971. Subsequent to this occurrence,flood mitigation and hydrology was made an additional responsibility of the Department from 1972onwards.
From 1986, coastal engineering has become an added function of the DID. The River ManagementConference was held on 1988, and a subsequently lead to the establishment of the River EngineeringDivision in 1990.
The Department has moved from the Ministry of Agriculture (MOA) to the Ministry of NaturalResources & Environment (NRE) on March 27th, 2004 and taken on new and expandedresponsibilities. Today, the DID's duties encompass :
Hydrology and Water Resources
River Management
Flood Mitigation
Coastal Management
Stormwater Management
The DID can look back on its history of successfully executed programmes with pride. Theexperience and knowledge that it has gained, together with its current dynamism have placed theDepartment in the forefront as the custodian of the nation's water resources.
2.3 CORPORATE INFORMATION
Vision
To be a world class organization by the year 2010.
Mission
To manage water resources, river basins, flood risks and coastal zones to achieve environmentalsustainability and enhanced quality of life.
Objective
To provide engineering services which are beyond the capability of the target group itself andsubsequently to ensure optimum land utilization and more efficient management of the nation'swater resources.
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Chapter 2 – DID ORGANISATION STRUCTURE
Core Values
Doing The Right Things, and Doing Things Right
with
Quality
Integrity
Caring
Q Policy
DID Malaysia is committed to an excellence work culture focused on continuous improvementtowards customer and employee satisfaction.
2.4 ORGANISATION STRUCTURE
The organisation structure of the DID is set out in Figure 2.1.
The Department consists of
15 divisions 15 state departments special project teams.
The DID is headed by the Director-General and assisted by Deputy Director-General (Development)and Deputy Director-General (Operation).
Each division and state department is headed by a Director, and assisted by Deputy Directors andofficers.
The special projects are under the purview of the Project Management Division, and each project isheaded by its Project Engineer.
Please refer to the DID official website for the current name and contact of the Director General,Deputy Director General, and Division and State Directors : http://www.water.gov.my/.
The organisation structure and corporate information of each division and state can be obtainedthrough the links to the website.
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Chapter 2 – DID ORGANISATION STRUCTURE
Figure 2.1 Organisation Chart
Organisation chart of DID, Malaysia effective from 1st June 2008. Please refer to the officialwebsite, http://www.water.gov.my, for the current chart and other corporate information.
DIRECTOR GENERAL
DEPUTYDIRECTOR GENERAL
(DEVELOPMENT)
DEPUTYDIRECTOR GENERAL
(OPERATIONS)
DIRECTORPROJECT
MANAGEMENT
CORPORATEDEVELOPMENT
LEGAL ADVISOR
STATE
FLOODMITIGATION
COASTAL
RIVER
URBANDRAINAGE
STRUCTURALGEOTECHNICAL
AND DAM
QUANTITYSURVEYING &
CONTRACT
JOHOR KEDAH
MELAKA
KELANTAN
TERENGGANU
PAHANG
SABAH
SARAWAK
LABUAN
PERLIS
SELANGOR
W.P.PUTRAJAYA
PERAK
PULAU PINANG
N.SEMBILAN
MANAGEMENTSERCVICES
MECHANICAL &ELECTRICAL
SERVICES
HYDROLOGY &WATERRESOURCES
TRAINING &CAREER
DEVELOPMENT
HUMID TROPICCENTRE
INFORMATIONTECHNOLOGY
QUALITY &PERFORMANCE
AUDIT
SMARTCONTROLCENTRE
RTBMSC
RTBSUNGAI PERAI
RTBKUALA LUMPUR
RPSA BERIS
UPPPKELANTAN
RTBSUNGAI KLANG
RANCANGANPENGAIRANMUDA
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART I : INTRODUCTION
CHAPTER 3
PROCUREMENT
– OVERVIEW
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Chapter 3 – PROCUREMENT- OVERVIEW
Table of Contents
Table of Contents .......................................................................................................................3-i
List of Figures ...........................................................................................................................3-ii
List of Tables.............................................................................................................................3-ii
3.1 INTRODUCTION ............................................................................................................. 3-1
3.2 GENERAL PROCUREMENT STRATEGY .............................................................................. 3-1
3.3 METHODS OF PROCUREMENT......................................................................................... 3-3
3.3.1 Quotation Exercise ............................................................................................. 3-3
3.3.2 Tender Exercise ................................................................................................. 3-3
3.3.3 Direct Negotiation .............................................................................................. 3-3
3.4 METHODS OF PROCUREMENT FOR GOODS AND SERVICES .............................................. 3-4
3.4.1 Procurement for Goods ...................................................................................... 3-4
3.4.2 Procurement for Services.................................................................................... 3-5
3.5 PROCUREMENT OPTIONS FOR WORKS............................................................................ 3-5
3.5.1 General Principles .............................................................................................. 3-5
3.5.2 Conventional Or Traditional ................................................................................ 3-6
3.5.2.1 Advantages under the traditional lump sum contract ............................. 3-7
3.5.2.2 Disadvantages under the traditional lump sum contract......................... 3-7
3.5.3 Design And Build................................................................................................ 3-73.5.3.1 Advantages associated with Design and Build ....................................... 3-8
3.5.3.2 Disadvantages associated with Design and Build................................... 3-8
3.5.4 Private Finance Initiative (PFI) ............................................................................ 3-8
3.5.4.1 The Advantages of PFI ........................................................................ 3-9
3.5.4.2 The Disadvantages of PFI .................................................................... 3-9
3.5.5 Forms Of Contract.............................................................................................. 3-9
3.6 REFERENCE DOCUMENTS ..............................................................................................3-10
3.7 REFERENCES.................................................................................................................3-10
APPENDIX 3A Procurement of Goods.................................................................................... 3A-1
APPENDIX 3B Procurement of Works.................................................................................... 3A-9
APPENDIX 3C Procurement of Services ............................................................................... 3A-15
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List of Figures
Figure Description Page
Figure 3.1 Government Procurement 3-2
List of Tables
Table Description Page
Table 3.1 Procurement of Goods 3-4
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3 PROCUREMENT
3.1 INTRODUCTION
This chapter provides:
An overview of the procurement strategy An outline of DID’s procurement strategy for supplies, works and services. The standard forms of contract used for DID projects
3.2 GENERAL PROCUREMENT STRATEGY
“Procurement” is about making choices and can be defined as the process of acquiring goods (orsupplies), works and services from suppliers, contractors and consultants, as the case may be asshown in Figure 3.1.
The procurement process covers the whole life cycle from identification of needs, through to thesatisfactorily delivery of goods or service or handing over of completed works.
Procurement, therefore, has a broader meaning than that of simply purchasing. It is concerned withsecuring services and products that best meet the needs of users and stakeholders. The keyobjectives of the procurement should be met.
The Treasury1 requires good governance practices when procuring for the Government throughtenders. The Project Team should be mindful of these principles when acquiring goods, works orservices:
Public accountability. Transparency. Value for Money. Open and fair competition. Fair dealings.
The determination the most acceptable price for the procurement of works, goods or servicesgenerally shall be carried out through:
quotation exercise, or tender exercise, or negotiation.
1 Surat Pekeliling Perbendaharaan Bil. 5 Tahun 2007 - Tatacara Pengurusan Perolehan KerajaanSecara Tender
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GovernmentProcurement
Works
Supplies
Services
An overview on
procurement andprocurement strategyfor Works are coveredin Chapter 3.
The guidelines andprocedures forConstructionManagement are setout in DID Manual
Volume 11.
The guidelines andprocedures forContract
Administration are setout in DID Manual
Volume 10.
A brief outline onprocurement processfor supply of goods isset out in Appendix 3A of Chapter 3
A brief outline onprocurement processfor services is set outin Appendix 3C of Chapter 3
Figure 3.1 Government Procurement
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3.3 METHODS OF PROCUREMENT
3.3.1 Quotation Exercise
The quotation exercise is used where the estimated value of works, goods or service does not
exceed RM500,000.00 per year. (Please refer to Treasury Circulars for current thresholds).
The quotation exercise is a simplified version of the tender exercise.
3.3.2 Tender Exercise
The tender processes involve a combination of ‘Open’ and ‘Selective’ tendering methods. Thefollowing are some of the often used processes.
Open tender - Suppliers, contractors or consultants are invited through advertisement. Allrespondents to the advertisement who request tender documentation will be invited to submit atender. There is no pre-qualification questionnaire or short-listing stage prior to invitation to
tender. Minimum standards of suitability may be lay down for respondent, failing which no tenderdocument will be issued.
Selective tender - Only suppliers, contractors or consultants who are short-listed will be invited tosubmit a tender. Care must be taken to ensure that the number invited is adequate to providecompetition. The tender list may be drawn from DID’s existing database, or through a pre-qualification exercise.
Pre-Qualification Exercise - Tenderers shall be invited through advertisements. All respondents tothe advertisement will be given a set of questionnaires to complete. The responses are assessedbased on agreed criteria. The tender list is prepared, based on the respondents who qualifiedunder the assessment, and shall be invited to tender.
‘Two Envelope’ Tenders – This method is often used in private sector only and not applicable onGovernment Projects. The purpose of the "two-envelope" tender method is to eliminate anyperceived or actual pre-judgment that may develop for, or against, lower or higher priced tendersbefore non-price criteria are evaluated. The ‘technical bid’ and the ‘financial bid’ are evaluatedseparately, by separate evaluation committees.
Refer to Chapter 7 for more details on the process and procedures.
For Government projects all procurement whether works, supply of goods or service exceedingRM500,000.00 per year shall be invited through tender.
3.3.3 Direct Negotiation
Goods, services or works may be directly sourced through direct negotiations, where usually there isno competitive process.
Direct negotiation is permitted where a directive is given by the Ministry of Finance to procureparticular goods, services or works from an identified party.
Detailed written records of negotiations must be maintained to avoid disputes, and providetransparency.
The process and procedures shall be as described in Appendix 3B (Procurement of Works).
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3.4 METHODS OF PROCUREMENT FOR GOODS AND SERVICES
The general procurement strategy of goods and services are outlined in Section 3.4.
Reference must be made to the current Government Circulars on the purchasing of goods and
services, in respect of:
The financial thresholds for purchasing goods and services and by what method
The standard terms and conditions of contract
The procedure for opening tenders, evaluating them and awarding contracts
The non-commercial considerations that need to take place in advertising tenders and tenderevaluation.
3.4.1 Procurement for Goods
The general procurement route for supply of goods for Government projects is as follows:
Table 3.1 Procurement of Goods
Value of each item per annum Procurement Option
Exceeding RM500,000 Tender
Exceeding RM100,000 but not exceedingRM500,000
Quotation from at least 5 registered suppliers
Exceeding RM50,000 but not exceedingRM100,000 Quotation from at least 5 registered Bumiputerasuppliers
Not exceeding RM50,000 Direct purchase or negotiations from registeredor non registered suppliers (both Bumiputera andnon Bumiputera).
Reference : AP170 and 171
Procurement for Emergency Cases
Exemptions to the Treasury Instructions are permitted for emergency cases only subject to theconditions stated in Treasury Instruction 173.2.
A brief outline on procurement process for supply of goods is set out in Appendix 3A (Procurement of Goods) of this Chapter.
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3.4.2 Procurement for Services
The scope of services is divided into two categories, namely:
a) Consultancy Services
b) Non Consultancy services
The consultancy services encompasses consultancy services for both physical and non physicaldevelopment and other category required by the Ministry/ Department and decided by Treasury fromtime to time.
The non consultancy services covers services such as provision of training and courses, maintenanceand repairs, cleaning, rental and building management, security and others.
A brief outline on procurement process for services is set out in Appendix 3C (Procurement of Services) of this Chapter.
3.5 PROCUREMENT OPTIONS FOR WORKS
3.5.1 General Principles
For Government projects the following procurement routes are commonly adopted:
a) Work order or indent - value of works not exceeding RM100,000 and shall be based onapproved Schedule of Rates for Civil Engineering and Building Works. For Electrical Work thevalue shall not exceed RM50,000 and shall be based on approved Schedule of Rates forElectrical Works.
b) Requisition works - minor and repair works (which do not alter the original structure) whichvalue do not exceed RM100,000 and shall be based on approved Schedule of Rates.
c) Non requisition works – works which are not based on approved Schedule of Rates and thevalue of works does not exceed RM500,000.
d) Works which estimated value exceeds RM500,000 must be procured through tender, eitherthrough conventional or design and build contract.
The procurement strategy should be consistent with the objectives of the project and should enablethe risks (i.e. uncertainties of time, cost and performance) to be controlled to achieve a successfuloutcome. It is the outcome of a series of decisions which are made during the early stages of aproject and the chosen strategy influences the allocation of risk, the design strategy and the
employment of consultants and contractors. It has a major impact on the time scale and ultimatelythe cost of the project.
The main types of procurement option commonly adopted by the Government are as follows:
a) Conventional or traditional : design by consultants (or in house) is completed beforecontractors tender for, then carry out the construction works
b) Design and build : design and construction are both undertaken by a single contractor inreturn for a lump sum price.
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The chosen option should also reflect the Government’s technical ability and resources and theamount of control over the process which the Government wishes to exert directly or indirectly.
Therefore, Project Head and/or Project Team must have a clear understanding of where the ultimateauthority and responsibility for controlling and managing the important risks lie.
There are a number of key factors to be considered when selecting a procurement option. Theseinclude:
the availability of in-house resources and experience; the project size and complexity; the importance of timescales and possible phased completion requirements; the importance of quality and issues surrounding whole-life use of the facility; and the availability of funding (in addition to setting and agreeing the budget for the project).
Whatever procurement route is chosen, sufficient time must be built into the overall programme toallow for all planning stages to be fully completed (both before construction starts and during the
progress of the project). Good planning will include getting the construction sequence right,assessing and managing project risks, and using value management to assess the contribution of each part of the construction process. These steps will minimise the likelihood of delays, extra costs,and waste/inefficiency.
The procurement routes briefly described in Sections 3.6 to 3.7 may be adopted for a DID project.
3.5.2 Conventional Or Traditional
Under the ‘conventional’ or ‘traditional’ contract, the contractor builds to a defined scope of work fora fixed lump sum price. It is sometimes referred to as lump sum contract. The fixed lump sum pricecontract may be based on drawings, specifications and quantities or based on drawings and
specifications only.
With this type of contract, the Design Team (whether in-house designers, or Consultants appointedby the Government) are to fully develop the design prior to going out to tender.
The contract is with the main contractor who has responsibility only for the construction works.
If the design has been fully thought out, developed and frozen, then in theory, this type of contractshould provide a reasonable degree of cost certainty at tender stage.
However, the need to work to tight timescales may mean that a fully developed design cannot beprepared in advance of tendering, in which case, subsequent design changes will invariably lead tocost escalation
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3.5.2.1 Advantages under the traditional lump sum contract
Competitive fairness. Design-led, facilitating a high level of quality in design and construction is achievable as the
scope of the work is prescribed on an input basis. The Government retains direct contractual relationships with the design team, cost consultant
and main contractor. Price certainty and transfer of risk to the main contractor is achieved at contract award provided
no subsequent changes are instructed to the design. The procedure is well known, and changes to the works can be easily arranged and valued based
on known prices obtained in competition without necessarily excessive cost or time implications. Satisfactorily public accountability.
3.5.2.2 Disadvantages under the traditional lump sum contract
The overall programme may be longer due to the need to produce a fully detailed design beforethe project goes out to competitive tender and work starts on site i.e. no parallel working.
No buildability input by contractor. The Government must have the resources and access to the expertise necessary to administer
the contracts of consultants and the main contractor since the traditional method often results inadversarial relationship developing.
Claims for delay and disruption can arise if the design is not fully detailed prior to agreeing thecontract sum or if the Government varies the design afterwards. Thus it could be open to abuse,resulting in less certainty.
3.5.3 Design And Build
Under a design and build contract, a single contractor assumes the risk and responsibility fordesigning and building the project in return for a fixed lump sum price.
Since it is a fast track procurement strategy, construction normally commences before thecompletion of all detailed design but at the contractor’s risk.
The range of design and build options available ranges from “turnkey” where the Government haslittle involvement in the design development or construction procurement process, to “develop andconstruct” where the Government appoints the designers to develop the brief to a level of sophistication which will leave the design and build contractor to develop the detail or specificationselements.
Under design and build the risk is transfer to the contractor and the Government loses some controlover the project. Any requirement which is not directly specified in the Needs Statement or tenderdocuments will invariably constitute variation to the contract which are usually more expensive to
introduce after the contract is awarded compared with other types of procurement strategy.
Therefore the Needs Statement must be fully and unambiguously defined in the tender documents(i.e. clear, accurate and delivered on time) and if the requirements are not specific, then theperformance specifications should be provided at the tender stage. Under this procurement optionthe contractor is likely to deliver the greatest performance benefits to the Government throughinnovation and standardisation, where appropriate output specifications are used.
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Where in some circumstances where the design and build procurement contract is extended to coverthe maintenance and/or the operation of the facility for a substantial period, the contractor hasincreased opportunity for adopting innovative solutions that provide greater value for money whenconsidering the whole life costs.
Design and Build contract may be procured through negotiation or tender process. See Appendix 3 –Flow Chart on Procurement of a Design and Build Contract through Direct Negotiation.
3.5.3.1 Advantages associated with Design and Build
Single point responsibility for design and cost risks (i.e. the Government has only to deal withone firm).
Price certainty is obtained before construction starts provided the Government’s requirementsare adequately specified and changes are not introduced.
Potential for more economical construction due to early consideration of building methods('buildability').
Reduced total project time due to the possibility of early completion i because of overlapping
activities.
3.5.3.2 Disadvantages associated with Design and Build
Difficulties in preparing adequate Government’s Requirements / Needs Statement. TheGovernment’s design needs must be properly specified as variations to the scope of the project,once awarded, can be expensive.
The Government has little control over design and quality standards once the contract isawarded, as the building is specified on a performance basis. There is no design overview unlessseparate check consultants are appointed by the Government for this purpose.
Government has to commit itself before the detailed designs are completed. Relatively fewer capable local construction firms undertaking the design and build projects so
there is less real competition. Design liability offered by design and build contractors is limited.
3.5.4 Private Finance Initiative (PFI)
The Private Finance Initiative or PFI is a form of public-private partnership (PPP) that combines two(2) procurement options, i.e.
where the Government purchases capital items from the private sector, and where the Government the contracts-out the provision of public services from the private sector.
PFI differs from privatisation in that the public sector retains a substantial role in PFI projects, eitheras the main purchaser of services or as an essential enabler of the project.
PFI differs from contracting-out in that the private sector provides the capital asset as well as theservices. The PFI also differs from other PPPs in that the private sector contractor also arrangesfinance for the project.
Under the most common form of PFI, the private sector designs, builds, finances and operates(DBFO) facilities based on ‘output’ specifications decided by public sector managers and theirdepartments.
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The private sector already builds most public facilities but the PFI also enables the design, financingand operation of public services to be carried out by the private sector. Under the PFI, the publicsector does not own an asset, such as a hospital or school but pays the PFI contractor a stream of committed revenue payments for the use of the facilities over the contract period. Once the contracthas expired, ownership of the asset either remains with the private sector contractor, or is returned
to the public sector, depending on the terms of the original contract.
PFIs are usually initiated at the Treasury or Ministry levels. There are no ‘standard’ terms andconditions, as each PFI largely depends on the assets and services requirements and the financingpackage.
3.5.4.1 The Advantages of PFI
Benefits include:
The process is service rather than project focused and concentrates on the whole life of theservice and associated assets.
There is a single point of responsibility for service delivery. There is an opportunity to draw on a wider range of management and innovation skills.
Construction projects of high capital value are more likely to achieve value for money under the PFIroute.
All PFI projects should be assessed on a case-by-case basis.
3.5.4.2 The Disadvantages of PFI
Risks include:
The process will be at risk without a long-term commitment from both the Government and"service providers".
The process leading up to the completion of a new building can take a long time and needs anextensive and fully refined brief at the outset.
There is a significant cost to the industry in tendering which has to be recovered by each bidder. Change is difficult to achieve and potentially expensive to incorporate once the contract is let.
3.5.5 Forms Of Contract
Forms of contract that are used by the DID include
For works
o PWD203 – Standard Form of Contract To Be Used Where Drawings and Specificationsform Part of the Contract
o PWD 203A – Standard Form of Contract To Be Used Where Bills of Quantities Form Partof The Contract
o PWD 203N – Standard Form of Contract for Nominated Sub-Contractor Where the MainContract is based Upon PWD Form 203 or 203A
o PWD DB/T – Standard Form of Design and Build Contract
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For Goods
o PWD 203P – Standard Form of Contract for Nominated Supplier Where the Main Contractis based Upon PWD Form 203 or 203A
o PWD 203E – Standard Form of Contract for Supply and Delivery of EngineeringEquipment and Plant
For consultants (where the professional fees are based on Scale of Fees prescribed by therespective professional boards)
o BEM/JKR FORM A – For Engineers
o BAM/JKR FORM B – For Architects
o BQSM/JKR FORM C – For Quantity Surveyors
3.6 REFERENCE DOCUMENTS
Royal Institution of Chartered of Surveyors – The Procurement Guide
3.7 REFERENCES
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 2 Tahun 1999: Had Nilai Perolehan dan Kuasa, Tanggungjawab Lembaga Perolehan danJawatankuasa Sebutharga
[2] Bil 8 Tahun 2006: Peraturan Perolehan Perkhidmatan Perunding
[3] Bil 5 Tahun 2007: Tatacara Pengurusan Perolehan Kerajaan Secara Tender
[4] Bil 12 Tahun 2007: Had Nilai Dan Syarat-syarat Pembelian Terus Bagi Bekalan DanPerkhidmatan
[5] Bil 5 Tahun 2009: Pembahan Had Nilai dan Tatacara Pengurusan Perolehan SecaraSebutharga
Treasury Instruction(Arahan Perbendaharaan)
[1] Arahan Perbendaharaan 31 Julai 2008
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPS Bil. 3/2004: Garis Panduan Perolehan Kerja Secara Sebutharga
[2] SP JPS Bil 3/2008: Tatacara Baru Permohonan dan Perlantikan Perunding di JPS Malaysia
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 3
– Procurement - Overview
APPENDIX 3A
Procurement of Goods
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APPENDIX 3A PROCUREMENT OF GOODS
Estimated Value of Goods / Supplies
Any type or class of Goods, up to the value
of RM 50,000 per year
ExceedingRM 50,000
Up toRM 100,000
Direct purchase fromany suppliers
Quotation fromminimum 5Bumiputeraregisteredsuppliers
Selective TenderOpen Tender
Ref: Arahan Perbendaharaan 170 SPP Bil 5/2009
ExceedingRM 100,000
Up toRM 500,000
Quotation fromminimum 5registeredsuppliers
Flowchart 3A.1 – Procurement Options (Based on value of supplies)
More thanRM 500,000
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Flowchart Description Action By
1. Establish Government’s needs. Head of Department
2. Ascertain the budget allocationincluding approval.
Controlling Officer
3. Ascertain the procurement route to beused (Direct purchase, quotation ortender?)
Procurement Officer
4. Procurement Process. Procurement Officer
5. Issue Purchase Order (AM 75), and of Letter of Acceptance (for purchasesthrough either Quotation or Tender).
Procurement Officer
6. Receive Goods and Purchase Ordersigned by the supplier. Check that theGoods are in good order.
Receiving Officer
7. Payment Finance Division
Flowchart 3A.2 – Process for Procurement of Goods
1
2
3
4
5
6
7
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Flowchart Description
1. Establish Government’s needs.
2. Ascertain the budget allocation includingapproval.
3. Preparation of quotation document.
4. Invite and Display of Quotation Notice.
5. Issuance, receiving at closing date and timeand opening of Quotation Submission.
6. Evaluation Report and Recommendation.
7. Decision and Approval.
8. Issue Local Order, with cover letter.
9. Receive goods and signed Local Order.
10. Payment
Flowchart 3A.3 – Quotation Process
1
2
3
4
5
6
7
8
10
9
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Flowchart Description
1. Establish Government’s needs.
2. Ascertain the budget allocation including approval.
3. Planning.
4. Preparation of Tender Documents and comply withGovernment’s needs.
5. Tender Advertisements.
6. Issuance, receiving at closing date and time andopening of tender submission.
7. Tender Evaluation Report and Recommendation.
8. Decision and Approval.
9. Prepare and signing Letter of Acceptance.
10. Issue Letter of Acceptance and Letter informing Acceptance of Tender.
11. Preparation & signing of Contract Documents.
12. Receipt of Goods.
13. Payment.
Flowchart 3A.4 – Tender Process
1
2
3
4
5
6
7
8
9
10
11
13
12
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3A.1 PROCEDURES
Please refer to Flowchart 3A.2 – Process for Procurement of Goods.
Step Procedures / Tasks Action By
General
For the purposes of these procedures, the “ProcurementOfficer” may be one of more persons who is/are given theduties of carrying out tasks of procuring Goods for or on behalf of the Department or section.
For information
1 & 2 Establish Needs and Ascertain Budget
Establish the Department’s (or section) needs for the particularGoods, including
o Quantityo Qualityo When the Goods is required.
Ascertain that budget is allocated for the Goods.
Action By:Head of
Department/Procurement Officer
3 & 4 Ascertain the procurement route to be used & The ProcurementProcess
Generally, the procurement route is pre-determined by thevalue of the Goods (or supplies) to be purchased and shallComply with the current Government’s guidelines on directpurchase
Direct purchase/ Quotations
Value of each item perannum
Procurement Option
Exceeding RM500,000 Tender
Exceeding RM100,000 up toRM500,000
Quotation from at least 5registered suppliers
Exceeding RM50,000 up to
RM100,000
Quotation from at least 5
registered Bumiputerasuppliers
Not exceeding RM50,000 Direct purchase fromregistered or non registeredsuppliers (both Bumiputeraand non Bumiputera).
Action By:Procurement Officer
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Step Procedures / Tasks Action By
Tender exercise.
o Open tender or selective tender.
o If procurement through selective tender:
- For the value of the Goods up to RM50 million, thenthe tender list and the acceptance of tender must beapproved by the Procurement Board convenedunder the Department / Ministry.
- For the value of the Goods exceeding RM50 million,then the tender list and the acceptance of tendermust be approved by the Procurement Boardconvened under the Ministry of Finance level.
5 Issue Purchase Order (AM 75), and Letter of Acceptance (forpurchases through either Quotation or Tender)
All purchases of goods by direct order
The current Form AM75 shall be used.
All purchases of goods by quotation or tender
The Letter of Acceptance of Quotation / Letter of Acceptance of Tender shall be used
Action By:Procurement Officer
6 Receive Goods and Purchase Order signed by the supplier.Check that the Goods are in good order.
The officer who receives the Goods (Receiving Officer) shallensure that the Goods are in good order, including
that the Goods are in accordance with the quantity anddescription stated on the Purchase Order
free from damage or visual defects is received on time a copy of the Purchase Order is duly signed and
accompanies the Goods.
Refuse or reject all damaged Goods, or Goods not inaccordance with the description stated in the Purchase Order.
Action By:Receiving Officer
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Step Procedures / Tasks Action By
7 Payment
Forward the claims and supporting documents for payment to
the relevant Finance Division.
The Finance Division shall check and submit the supportingdocuments together with payment voucher to the AccountantGeneral, Ministry’s Accountant or State Treasury (as the casemay be) to honour payment.
Please also refer to DID Manual Volume 10, Chapter 10 –Payments.
Action By:Receiving Officer
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Revision Date : March 2009
Chapter 3
– Procurement - Overview
APPENDIX 3B
Procurement of Works
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APPENDIX 3B PROCUREMENT OF WORKS
(Estimated Value of Works not exceeding RM500,000)
Project Brief
Selectprocurement
route
Requisition for minorand repair works which
do not alter original
structure
Non Requisition Works
Value?
Value?
< RM20,000 > RM 200,000
up to
RM 500,000
< RM20,000
RM 20,000up to
RM100,000
> RM 200,000up to
RM500,000
Directappointmentof registered
Class FContractor
Appointmentof registered
Class FContractor tobe based on
approvedSchedule of
Rates
Directappointmentof registered
Class FContractors
Quotationsfrom
registeredClass E
Contractors
Construction by contractor
Completion and Hand-over to DID Ref: Arahan Perbendaharaan 180 SPP Bil 5/2009
Quotationsfrom
registeredClass F
Contractor
> RM100,000 up to
RM200,000
Quotationsfrom
registeredClass F
Contractors
RM 20,000up to
RM200,000
Flowchart 3B.1 – Direct Appointment/ Quotation Procurement Options
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Chapter 3 – PROCUREMENT- OVERVIEW
(Estimated Value of Works exceeding RM500,000)
Project Brief
Selectprocurement
route
Conventional Contract(Design-tender-
construct)
Design and BuildContract
(Tender-design-construct)
Prepare NeedsStatement (By DID)
Tender / DirectNegotiation Process
Design and
construction bycontractor
Completion andHand-over to DID
In-House
Design stage
Tender / DirectNegotiation
Design stage
Appointment of consultants
Construction bycontractor
ByconsultantsDesign in-
house or byconsultants?
Flowchart 3B.2– Tender/ Direct Negotiation Procurement Options
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Chapter 3 – PROCUREMENT- OVERVIEW
Flowchart Description Action by
1. Establish Government’s needs. -
2. Ascertain the budget allocationincluding approval.
3. Preparation of quotation document.
4. Invite and Display of Quotation Notice.
5. Issue, receive at closing date and timeand opening of Quotation Submission.
6. Evaluation Report andRecommendation.
7. Decision and Approval.
8. Issue Works Indent.
9. Contractor completes the Work andreturns Works Indent duly signed.
10.Payment.
1
2
3
4
5
6
7
9
8
10
Flowchart 3B.3 – Quotation Process
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Chapter 3 – PROCUREMENT- OVERVIEW
Flowchart Description Action By
1. Establish Government’s needs. -
2. Ascertain budget allocation includingapproval.
ImplementationDepartment/PH
3. Preparation of tender documents andpreliminary estimates.
PO/ Engr
4. Check tender documents and Bills of Quantities.
PO /QS or Engr
5. Tender documents in order? -
6. Tender notice and advertisement. PO
7. Issue tender documents to Contractorsfor pricing, and received priced tenderdocuments.
BUBK
8. Tender Evaluation Report, andRecommendation.
Evaluation Officer/Evaluation
Committee / BUBK
9. Decision and approval Tender ProcurementBoard
10. Prepare Letter of Acceptance PO
11. Sign Letter of Acceptance AtP
12. Issue Letter of Acceptance, and Letterinforming the acceptance of Tender
PO/SO
13. Preparation of contract documents CAO
14. Signing of contract documents; anddistribution of copies of contractdocuments
AtP; CAO
15. Post-contract Administration SO
16. Payment SO
PROCUREMENT OF WORKS
Yes
1
2
5
3
4
6
7
8
9
10
11
12
13
14
15
16
No
Flowchart 3B.4 – Tender Process
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Flowchart Description Action By
1. Establish Government’s needs. -
2. Ascertain budget. ImplementationDepartment/PH
3. Received Instruction / Approval from Ministry of Finance.
-
4. Issue Letter of Intent to Contractor. AtP
5. Preparation of tender documents andpreliminary estimates.
PO/ Engr
6. Check tender documents and Bills of Quantities. PO /QS or Engr
7. Tender documents in order? -
8. Issue tender documents to Contractor forpricing, and received priced tender documents.
BUBK
9. Analyse contractor’s price. Evaluation Officer/Evaluation Committee /
BUBK
10. Price Negotiation Committee Meeting. Price Negotiation
Committee
11. Report Price Negotiation result to Ministry forendorsement. Forward endorsed report toMinistry of Finance for approval.
BUBK
12. Approval from Ministry of Finance. -
13. Prepare Letter of Acceptance PO
14. Sign Letter of Acceptance. AtP
15. Issue Letter of Acceptance of Tender and Letterinforming the acceptance of Tender
PO/SO
16. Preparation of contract documents CAO
17. Signing of contract documents and distributionof copies of contract documents
AtP; CAO
18. Post-contract Administration SO
19. Payment SO
3
1
4
5
6
8
2
9
10
11
12
13
14
15
16
17
18
19
7
Yes
No
Flowchart 3B.5 – Direct Negotiation for Conventional Contract
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Flowchart Description Action By
1. Establish Government’s needs. -
2. Ascertain budget. ImplementationDepartment/PH
3. Received Instruction / Approval from Ministryof Finance
-
4. Issue Letter of Intent and pre-bid documentsto Contractor
ImplementationDepartment/PD
5. Received Contractor’s Proposal -
6. Evaluate the proposal Departmental Design
Team
7. Complying with Needs Statement? -
8. Analyse contractor’s price Evaluation Officer/Evaluation Committee /
BUBK
9. Price Negotiation Committee Meeting. Price NegotiationCommittee
10. Report Price Negotiation result to Ministry for
endorsement. Forward endorsed report toMinistry of Finance for approval.
BUBK
11. Approval from Ministry of Finance.-
12. Prepare Letter of Acceptance PO
13. Sign Letter of Acceptance. AtP
14. Issue Letter of Acceptance of Tender andLetter informing the acceptance of Tender
PO/SO
15. Preparation of contract documents CAO
16. Signing of contract documents anddistribution of copies of contract documents
AtP; CAO
17. Post-contract AdministrationSO
18. Payment SO
1
18
2
3
9
4
10
6
5
8
11
12
13
14
16
15
17
7
Yes
No
Flowchart 3B.6 – Direct Negotiation for Design and Build
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 3
– Procurement - Overview
APPENDIX 3C
Procurement of Services
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APPENDIX 3C PROCUREMENT OF SERVICES
Type of Services
Non Consultancy(Conducting courses and
training, maintenanceand repairs, cleaning
and clearing, rental andbuilding management,security and etc.
Consultancy
Value perannum
Procurement Option
ExceedingRM500,000
- Tender
Exceeding
RM100,000up toRM500,000
- Quotation from at
least 5 registeredsuppliers
ExceedingRM50,000up toRM100,000
- Quotation from atleast 5 registeredBumiputera suppliers
NotexceedingRM50,000
-Direct purchase fromregistered or nonregistered suppliers
(both Bumiputera andnon Bumiputera).
PhysicalDevelopmentConsultancy
Physical / NonPhysical Studies
Consultancy
Direct Appointment(physical
development scopeof works, land and
environmentalsurvey and where
the requiredexpertise is limited)
Appointmentthrough
Technical andFinancialProposal
(physical andnon physicaldevelopmentand/or when
theimplementingagency doesnot have the
expertise
Reference: AP 185 – 190; 31 July 2008 SPP Bil 5/2009
Flowchart 3C.1 – Procurement of Services
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Flowchart Description Action by
1. Propose 5 names of Consultant, prepareevaluation, scoring marks and
recommendation paper.
PH
2. Receive the recommendation paper for theappointment of Consultant.
BUBK
3. Check. BUBK
4. Agree with recommendation paper? [8] BUBK
5. Propose different consultants BUBK
6. Approval of new selection. [1] Deputy Director General(Development)
7. Submit the recommendation paper to the Authorised Party and inform PH. BUBK
8 Approval from Authorised Party -
9. Issue Letter of Intent to Consultant. PH
10. Consultant submits Technical and FinancialProposal.
-
11. Evaluation of Technical Proposal andFinancial Proposal.
PH
12. Negotiation. Technical and FinancialNegotiation Committee
13. Evaluation and recommendation. PH
14. Check and submit recommendation to Authorised Party for approval.
BUBK
15. Decision from Authorised Party. [11] -
16. Issue Letter of Acceptance to Consultant. PH
17. Sign the Consultancy Agreement AtP
18. Consultant performs the Work. -
19. Payment. -
1
2
3
4
5
6
9
12
13
14
16
7
10
17
18
19
15
8
11
No
Yes
Approve
Disagree
Flowchart 3C.2 – Direct Appointment of Consultants(Ref : SPP 8/2006 and SP JPS 3/2008)
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Chapter 3 – PROCUREMENT- OVERVIEW
Flowchart Description Action by
1. Propose minimum 5 names of Consultants,prepare evaluation, scoring marks andrecommendation paper.
PH
2. Receives the recommendation paper for theappointment of Consultants.
BUBK
3. Check. BUBK
4. Agree with recommendation paper? BUBK
5. Secretariat proposes different name(s). BUBK
6. Approval of new selection). Deputy DG(Development)
7. Submit the recommendation paper to the
Authorised Party.
8 Approval from Authorised Party
9. Invitation to shortlisted consultants to submitTechnical and Financial Proposals.
10 Shortlisted consultants submit Technical andFinancial Proposals
11. Evaluation of Technical Proposals and FinancialProposals.
12. Forward recommendation (report) to BUBK. PH/PO
13. Check and submit recommendation on cost to Authorised Party for decision.
BUBK
14. Authorised Party approves recommendation?
15. Issue Letter of Intent to Consultant.
16. Technical and Financial negotiation withConsultant
17. Secretariat prepares and submits recommendation
paper to Approving Authority for decision
18. Decision by Approving Authority
19. Issue Letter of Acceptance to Consultant.
20. Sign the Consultancy Agreement.
21. Consultant performs the services.
22. Payment.
1
2
3
4
5
6
9
12
13
15
7
10
17
14
19
20
21
22
18
16
8
11
No
Disagree
Disagree
Approverequiring
negotiation
Agree
Approvewithout
negotiation
Yes
Flowchart 3C.3 – Appointment of Consultants through Technical and Financial ProposalRef : SPP 8/ 2006 and SP JPS 3/2008
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Chapter 3 – PROCUREMENT- OVERVIEW
3C.1 LIMIT OF AUTHORITHY FOR THE APPOINTMENT AND APPROVAL OF COST OF
CONSULTANCY SERVICES
The Authorised Party and limit of authority for the appointment and approval the cost of consultancyservices are as follows:
a) Physical Development Projects
Authorised Party Authority Limit
Project Cost Consultancy Cost
a. Treasury Exceeding RM50 million Exceeding RM5 million
b. Procurement Board “A” Ministry of Natural Resources and Environment
Up to RM50 million Up to RM5 million
b) Physical/ Non Physical Studies
Authorised Party Authority Limit for approving the appointment
and consultancy cost
a. Treasury Exceeding RM1 million
b. Procurement Board “A” Ministry of NaturalResources and Environment
Up to RM1 million
c) Land Survey and Environmental Works
Authorised Party Authority Limit for approving the appointment
and consultancy cost
a. Treasury Exceeding RM300,000
b. Procurement Board “A” Ministry of NaturalResources and Environment
Up to RM300,000
d) Additional Consultancy Cost
Authorised Party Authority Limit for approving the additionalconsultancy cost
a. Treasury Exceeding 30% of original cost
b. Procurement Board “A” Ministry of NaturalResources and Environment
Up to 30% of original cost
(Ref : Treasury Circulars No. 8/ 2007 and DID Circular JPS No 3/2008).
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART I : INTRODUCTION
CHAPTER 4
PROJECT IMPLEMENTATION
– OVERVIEW
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Chapter 4 – PROJECT IMPLEMENTATION – OVERVIEW
Table of Contents
Table of Contents .......................................................................................................................4-i
List of Figures ...........................................................................................................................4-ii
4.1 INTRODUCTION ............................................................................................................. 4-1
4.2 FUNCTION OF PROJECT MANAGEMENT........................................................................... 4-1
4.3 PROJECT LIFE CYCLE...................................................................................................... 4-3
4.3.1 Project Initiation ................................................................................................ 4-4
4.3.2 Project Planning Stage ....................................................................................... 4-6
Design and Build .............................................................................................. 4-6
4.3.3 Conceptual Design Stage .................................................................................... 4-6
Design and Build .............................................................................................. 4-6
4.3.4 Preliminary Design Stage (Schematic Design Stage) ............................................. 4-7
Design and Build .............................................................................................. 4-7
4.3.5 Detailed Design Stage ........................................................................................ 4-7
Design and Build .............................................................................................. 4-7
4.3.6 Tender Stage ..................................................................................................... 4-7
4.3.7 Construction Stage............................................................................................. 4-8
4.3.8 Completion and Hand-Over................................................................................. 4-8
4.3.9 Defects Liability Stage & Close Out...................................................................... 4-94.4 SPECIAL PROJECTS ........................................................................................................ 4-9
4.5 IMPLEMENTATION OF PROJECT: PROJECT TEAM, AND RESPONSIBILITES .......................4-10
4.5.1 Project Team (PT).............................................................................................4-10
4.5.2 Project Head (PH) .............................................................................................4-12
4.5.3 Superintending Officer’s Representative (SOR)....................................................4-12
4.5.4 Procurement Officer (PO) ..................................................................................4-13
4.5.6 Contract Administration Officer (CAO) ................................................................4-13
4.5.7 Project Supervisor (PS)......................................................................................4-13
4.5.8 Design Team or Designer (DT) ..........................................................................4-13
4.5.9 Consultant ........................................................................................................4-14
4.6 PARTIES NAMED IN THE CONTRACT ..............................................................................4-14
4.6.1 Superintending Officer (SO) or Project Director (PD) ...........................................4-14
4.6.2 SO’s Representatives (SOR) and PD’S Representatives (PDR)...............................4-14
4.6.3 Contractor ........................................................................................................4-15
4.7 AUTHORISED PARTY .....................................................................................................4-15
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Chapter 4 – PROJECT IMPLEMENTATION – OVERVIEW
List of Figures
Figure Description Page
Figure 4.1 Functional Project Organisation 4-2
Figure 4.2 Project Life Cycle Flow Chart (Outline) 4-3
Figure 4.3 Project Initiation Chart (Other than Special Projects) 4-5
Figure 4.4 Project Team Organisation 4-11
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Chapter 4 – PROJECT IMPLEMENTATION – OVERVIEW
4 PROJECT IMPLEMENTATION - OVERVIEW
4.1 INTRODUCTION
This chapter provides:
An overview of the process of implementing and managing the projects undertaken by the DID. A brief outline of the roles and responsibilities of the various member of the project team.
4.2 FUNCTION OF PROJECT MANAGEMENT
Project management may be defined as the overall planning, co-ordination and control of a project from inception to completion aimed at meeting the Government’s and stakeholders’ requirements in order to produce a functionally and financially viable project that will be completed on time within authorized cost and to the
required quality standards.
From inception to completion, a project involves many parties, e.g.
the stakeholders, who have vested interest in the success or outcome of the project.
Internal stakeholders include the Government department who is the originator of the project, orthe end-user of the works. External stakeholders include such parties who may be affected byproject, including neighbouring landowners and those who may benefit from the completion of the project (say, residents at a flood prone area, under a flood mitigation project).
the various professionals and specialists forming the project team.
These professionals and specialists contribute knowledge and experience to the decision matrixat each stage of the project implementation.
the contractors(s) and nominated subcontractors / suppliers who shall deliver the completedproject.
The functional relationship of the various parties in the project is as shown in Figure 4.1.
The task of project management is to bring all the parties together and co-ordinate the actions toenable them to make their best possible contribution in the most efficient manner.
In larger scale projects, the management function of a project is often separated from the designand execution functions, whilst in smaller projects both the management and design functions maybe carried out by the leader of the design team.
The roles of the Project Team and the parties in connection with the implementation or project andadministration of contract are further discussed in section 4.5, below.
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Chapter 4 – PROJECT IMPLEMENTATION – OVERVIEW
Legend:
Direct Relationship
Indirect Relationship
Figure 4.1 Functional Project Organisation
PROJECT TEAM
InternalStakeholders External
Stakeholders
Contractor
Nominated Sub-Contractors /
Suppliers
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4.3 PROJECT LIFE CYCLE
The project is implemented in a number of steps or stages.
For the purpose of this Chapter, the stages in the project life cycle are summarised into the nine (9)
main stages, as outlined below and represented in Figure 4.2.
The main activities and responsibilities of the Project Team at each state are set out below.
Volume 10 shall only cover Tender, Construction, Completion and Hand-over and Defects Liabilityand Close out Stage.
START
END
PROJECTINITIATION STAGE
DEFECTS LIABILITY & CLOSE OUT STAGE
PROJECTPLANNING STAGE
CONCEPTUALDESIGN STAGE
PRELIMINARY DESIGN STAGE
DETAILEDDESIGN STAGE
TENDER STAGE
CONSTRUCTION STAGE
Volume 10:Contract Administration
COMPLETION ANDHAND-OVER
Figure 4.2 Project Life Cycle Flow Chart (Outline)
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Chapter 4 – PROJECT IMPLEMENTATION – OVERVIEW
4.3.1 Project Initiation
Government projects implemented by DID may be initiated by
The Treasury or The Ministry’s Development Division or A DID Division or State
The project initiation and implementation chart is set out in Figure 4.3.
At this stage, the general objectives of the project are established and a budget may be allocated forits implementation.
Once the project is approved, and the budget is allocated, the Controlling Officer or Director-General(as the case may be) shall delegate the implementation of the project to the respective Division orState Director.
The Division or State Director shall then appoint the Project Head for the implementation of theproject.
At the pre-implementation or pre-tender stages of each project and/or contract, the Project Headand Project Team must check that sufficient budget is available for the project and/or contract.
(The remainder of this page is deliberately left blank)
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1. Ministry /Controlling
Officer
2. DG of DID
3. ImplementingDivision /
State
4. ProjectHead
5. Project Team
1. The Ministry approves the budgetary allocation andlist of projects to be implemented by DID. The
Controlling Officer shall notify the Director-Generalthe approved allocations and project list.
2. The Director-General shall assign the project to therelevant implementing Division or State Director,and sets the project’s ceiling budget, for theexecution and completion of the project.
3. The implementing Division / State Director shallmanage and be responsible for the execution andcompletion of the project. The Division or StateDirector shall appoint an officer as the ProjectHead. The implementing Division / State and theProject Head shall be assisted by officers from theimplementing Division / State, and officers from thesupporting Divisions, e.g. Contracts and QuantitySurveying Division, Mechanical and ElectricalServices Division, Hydrology and Water ResourcesDivision, etc.
4. The Project Head shall identify the resources andpersonnel requirements for the project. The
Project Head shall recommend and appoint themembers of the Project Team and Design Teamfrom within DID, or where necessary, Consultantsshall be appointed.
5. The PH / Project Team shall determine theplanning data and design criteria. Further studiessuch as geotechnical studies, environmental impactstudies, etc. shall be carried out as necessary.
6. The Project Head / Project Team shall determinethe design brief and criteria. Once the scope of works is determined, the PH/Project Team shallconsider the procurement option best suited for theimplementation of the project, including whether todesign in-house or to appoint Consultants. Pleaserefer to Chapter 3 [Procurement] for procurementprocesses and procedures.
6. Design & Procurement
Figure 4.3 Project Initiation Chart (Other than Special Projects)
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Chapter 4 – PROJECT IMPLEMENTATION – OVERVIEW
4.3.2 Project Planning Stage
At the project planning stage, the Project Head and his team shall develop the package strategy forthe overall implementation of the project, including:
The project brief and project cost plan (preliminary estimate) Project master programme, outlining the procurement of Consultants (if required), design stages,
tendering, construction and handover.
The programme should include key stages, including the review, verification and validation of variousdesign output produced by the Design Team / Consultant.
Considerations should be given, and decision made, whether to procure under a traditional contract(i.e. design-tender-construct), or under a design a build contract.
Further studies may be required before the Conceptual Design Stage may commence, or to becarried out concurrently with the Conceptual Design Stage, including:
Feasibility study Site investigation Hydrological and Hydraulic investigation Geotechnical investigation Environmental impact assessment.
Other issues to be considered and included in the project planning stage are:
Land acquisition. Co-ordination and liaison with other Government departments and agencies
Design and Build
For design and build contracts, the Needs Statement shall be prepared by DID to be included in thepre-bid document to be issued to the Tenderers for the submission of the technical and commercialproposal.
4.3.3 Conceptual Design Stage
The Design Team / Consultants shall develop the conceptual design based on the Needs Statement.
The conceptual design process should provide the outline design to a level such that the scope of works can be fully confirmed and agreed.
The endorsement of the Division / State Director is required before proceeding to Preliminary DesignStage.
Design and Build
For design and build contracts, the Tenderer’s proposal shall include the conceptual design. Thisshall be one of the basis for consideration for the award of contract.
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4.3.4 Preliminary Design Stage
At the preliminary design stage, the Project Team shall appraise the soundness of various designproposal and assess the buildability, as more information is gathered following the approval of theconceptual design.
Value management should be carried out during the process so as to have optimal performance atthe advantageous economic value. The Project Head / Project Team shall appraise the variousoptions, and propose to the relevant Division / State Director or Funding Body for implementation.
The output from the preliminary design process should secure a preliminary endorsement from theDivision / State Director or Funding Body, and enable the Design Team to proceed to the DetailedDesign Stage.
Design and Build
This process is also applicable for Design and Build Contracts, where the approval of the Preliminary
Designs shall enable the Contract Sum to be finalized.
The PH ensures that the decisions and matters agreed in the earlier stages are effectively andefficiently implemented.
4.3.5 Detailed Design Stage
During the detailed design stage, the Design Team shall carry out technical design and production of drawings concurrently. The Designer shall ensure that the design coordination is carried out closely.Interaction between the End-User is also required, especially in the selection of materials, goods andplants.
The Design Team should advise on the suitability and reliability of the selected items. The DesignTeam must allow sufficient time for the End-User to consider and approve the submitted designsand drawings.
Design and Build
This process is also applicable for Design and Build Contracts, where the detailed design stage iscarried out by the Contractor.
4.3.6 Tender Stage
At this stage, the Project Team has sufficient information to identify the various scope of works, e.g.the various construction packages ranging from main contractor, nominated sub-contractors and
nominated suppliers.
The Project Team should formulate the procurement strategy, including:
Pre-qualification of tenderers Type of Tender (Open, selective or direct negotiation) Preparing list of tenders for approval by Tender Procurement Board Packaging the works into multiple contracts Types of contract, e.g. with quantities (JKR203A) or without quantities (JKR203). The decision to
use design and build contract (JKR DB/T) is usually made at the Project Planning Stage. Activity schedule for the tendering process, until construction completion.
Please refer to Part II – Pre-Contract for the tendering and award process and procedures.
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4.3.7 Construction Stage
In this stage, the Project Team is principally involved in monitoring the performance of theContractor, and the progress of the works.
The principle activities include:
Ensuring contract documents are prepared and issued to the Contractor Ensuring the contracts are signed Arranging the handover of the Site to the Contractor Reviewing contractor’s construction programme and method statements Ensuring that procedures are in place and being followed Ensuring that site meetings are held and documented Confirming the insurance cover, performance bond and other deliverables from the Contractor
are in accordance with the Contract Reviewing progress for the Contractor Monitoring the Contractor’s performance
Ensuring that the design information required by the Contractor is supplied by the Design Team(where the works are not contracted under a ‘design and build’ contract)
Monitoring financial status Preparing payments and arranging payment authorisation Managing variations Managing adjustments to the Contract Sum(s) Anticipate and resolve potential problems before they develop or escalate. Assisting the Superintending Officer (or Project Director) in the assessment of contractor’s claims
for extension of time and for loss and/or expense Reporting to the Superintending Officer (or Project Director), the Director-General or Controlling
Officer, or Funding Body, as the case may be.
Please refer to Volume 10, Part III – Post-Contract for the contract administration process andprocedures for the construction stage.
Please refer to Volume 11 for the construction management process and procedures for theconstruction stage.
4.3.8 Completion and Hand-Over
The Project Team shall ensure that all prerequisites as per the contract has been completed anddelivered (except the obligations to be carried out in Defects Liability Stage, or deferred/exemptedunder the terms of the Contract) before the Certificate of Practical Completion is issued, including:
All testing, commissioning and/or endurance tests must be successfully completed. The relevant records, documents and drawings are handed over. Design Guarantee (if applicable) is submitted.
The Consultants / Superintending officer’s Representative shall prepare and submit therecommendation report, together with the Schedule of Defects and list of acceptable outstandingworks, if any, to the Project Team.
Refer to Volume 11, for the process and procedures relating to project completion and hand-over.
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4.3.9 Defects Liability & Close Out Stage
The Project Team shall demobilise upon the issuance of the Certificate of Practical Completion, savefor such remaining members who are given the responsibilities of monitoring and managing theDefects Liability Stage, and the preparation of the Final Accounts and Final Certificate (Close Out
Team).
The Close Out Team is to ensure that
all defective works which had been identified during the defects liability period have beenrectified, and properly closed out.
Upon the expiry of the Defects Liability Period, a Schedule of Defects (if necessary) is preparedand the defects therein rectified by the Contractor.
The Final Accounts are prepared and signed off by the Contractor. the final inspection shall be arranged, and jointly carried out by the relevant parties, and the
Certificate of Making Good Defects is issued as per the Contract. The final deliverables, such as statutory declaration (or letter from the Labour Department) are
submitted prior to issuance of the Final Certificate.
Refer to Volume 11, for the process and procedures relating to the on-site management of DefectsLiability Stage.
Refer to Volume 10, chapters 18 and 19 for contract administration for defects management, andFinal Account and Final Certificate.
4.4 SPECIAL PROJECTS
Special Projects are one-off projects, initiated by the Government or by a third party, to meet aparticular need. The source of funding may be an external Funding Body, or funded through
alternative procurement strategies such as Private Finance Initiative (PFI), Build-Operate-Transferand other methods of procurement.
Examples of such special projects include: the Sg. Muda Flood Mitigation Project, SMART Tunnel,Bertam - Kepala Batas Flood Mitigation Project, etc.
The project initiation, planning and implementation procedures (including terms of the contract andcontract administration) are dependant on the particular circumstances, and are excluded from thisManual.
Nevertheless, the procedures and description set out in this manual may be used as generalguidelines, subject to the needs and circumstances of the project, and terms and conditions of thecontract.
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4.5 IMPLEMENTATION OF PROJECT: PROJECT TEAM, AND RESPONSIBILITES
4.5.1 Project Team (PT)
The DID practices the project team concept to perform the activities required to complete a project.
The Project Team Organisation is set out in Figure 4.4.
The DID Project Head (PH) is the leader of this project team, and is ultimately responsible for theexecution and delivery of a project.
During the implementation a project, the PH will rely on
the Procurement Officer (PO) to perform tender administration duties;
the Contract Administration Officer (CAO) to perform contract administration duties, and
the Superintending Officer’s Representative (SOR) and Project Supervisor (PS) to perform
construction management duties.
Where third party consultants (Consultant) are appointed, these duties are performed by theConsultant and audited by the CAO or SOR, as the case may be.
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Figure 4.4 Project Team Organisation
ProjectSupervisor
ImplementationOfficer / SOR
Project Head
Consultant(s)
Contract Administration
Officer
Design Team /Designer
ProcurementOfficer
TenderSecretariat
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Typical duties for the PH, SOR, PO, CAO, PS and other project team members are detailed below:
4.5.2 Project Head (PH)
The PH has overall responsibility and authority for entire execution of the project.
The PH is the single point of contact for all project activities from planning through project close out.
The PH may delegate responsibilities to members of his project team, including on-site constructionmanagement duties to the Superintending Officer’s Representative, but the PH remains fullyaccountable for the execution of the project within the scope, schedule, and budget parametersestablished for the project.
The duties and responsibilities of the PH includes but not limited to:
Responsibility for the project’s technical and financial directions and for ensuring external andinternal stakeholder satisfaction with project results.
Administer professional service, design and construction contracts, including involvement indesign contract negotiations. Establish initial project budgets, cost estimates, cash flow projections and master schedules. Develop and provide periodic updates (monthly or such period set by the Stakeholders) of project
schedules and budgets. Monitor project schedules and budgets to ensure financial and schedule milestones are met. Resolve public questions and concerns about the project. Co-ordinate with other Government departments and agencies and/or private utilities and
companies involved in the project. Oversee easement acquisition/utility relocation and permitting activities. Prevent or resolve problems occurring during project development and execution. Participate in the development of bidding documents and the construction contract award process
(as applicable). Analyse problems occurring during the project and take actions to ensure project goals are met. Provide regular progress reports and monthly briefings. Ensure project records and documentation are properly maintained. Select and assign projects to staff, SOR and consultants. Set schedules for interim project reviews. Supervise the quality assurance manager and safety and health officer for the project.
4.5.3 Superintending Officer’s Representative (SOR)
The PH may delegate duties or responsibilities to the SOR, or PDR for design and contracts.
The SOR will ensure that the Contractor’s work is supervised and routinely inspected. The SOR must
confirm that the Contractor complies with all required contractual, cost, schedule, safety and qualityobligations, including environmental requirements.
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4.5.4 Procurement Officer (PO)
For the purpose of this Manual, the Procurement Officer (PO) is responsible for the pre-contractadministration functions including coordination with the PH to choose a project-delivery method,selecting and appointing Consultants and carrying out exercises for selection of contractors.
The PO shall facilitate the necessary approvals from the appropriate Authorised Party.
4.5.5 Tender Secretariat (TS)
The Tender Secretariat is responsible for the preparation of the tender evaluation paper for theTender Procurement Board meeting.
4.5.6 Contract Administration Officer (CAO)
The Contract Administration Officer is responsible for all post-contract functions, including facilitatingpayment applications, tracking changes and costs, assisting the SO/PD or their Representative in the
assessment of contractor’s claims for additional time and payments, and project close out with theproject team.
The CAO shall facilitate the necessary approvals from the appropriate Authorised Party.
4.5.7 Project Supervisor (PS)
The Project Supervisor (PS) will perform day-to-day construction management activities in support of the SOR.
The PS’s responsibilities include daily supervision of the Contractor’s work, daily preparation of written reports, and facilitating communications between the Contractor and SOR.
The PS reports to the SOR.
4.5.8 Design Team or Designer (DT)
The Designer is responsible for designing the project and preparing plans, specifications andestimates and design manuals.
DID’s own engineering staff, especially on smaller design projects where a quick turn around isrequired, may perform Designer services inhouse.
Large projects requiring a full range of professional services (soils, investigation, survey, publicinvolvement, hydraulic analysis, etc.) are typically performed by the Consultant who has been
awarded a qualification-based professional services contract with the DID.
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4.5.9 Consultant
Where Consultant is appointed to carry out design works or to provide specialist services, the PHmay also appoint the Consultant as his representative on contract-related and construction-relatedmatters.
Within the limits of the delegation, the Consultant will inspect the Contractor’s work and ensure thatthe Contractor meets the required contractual, cost, schedule, safety and quality obligations.
The Consultant may be assisted by his own site staff.
4.6 PARTIES NAMED IN THE CONTRACT
Notwithstanding the roles and responsibilities of the parties implementing the project under thecontract, the execution and supervision are ultimately the responsibilities of the SO/PD and theContractor.
4.6.1 Superintending Officer (SO) / Project Director (PD)
The administration of the construction contract is the responsibility of the SO/PD duly named in thecontract.
Who may be appointed or named as the SO/PD depends on a number of factors, including:
Value of the works (please refer to section 5.3) Whether the project is undertaken at HQ or State level The location of the works.
The PH and the SO/PD need not be the same officer.
4.6.2 SO’s Representatives (SOR) / PD’S Representatives (PDR)
The supervision of the construction work is generally carried out by the SOR/PDR.
The SO/PD may delegate powers to more than one officer to perform different duties on his behalf,as follows:
Principal SO’s Representative / PD’s Representative
Overall supervision and direction of the execution of the works.
Specialist SO’s Representative / PD’s Representative
E.g. an electrical or mechanical construction manager to supervise the execution of electrical ormechanical works.
The format of letters delegations are appended under Volume 10A, Chapter 9 – ContractDocumentation.
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4.6.3 Contractor
For the purposes of this Volume 10, the Contractor refers to the general contractor on a DIDconstruction project.
The Contractor is the prime contract holder with ultimate responsibility for completion of theconstruction work.
The PH, SOR/PDR and other DID officers typically should only have direct communications with theContractor (i.e. the PH should not correspond directly with subcontractors).
For the purposes of this Volume 10, the PH’s primary point of contact with the Contractor is theContractor’s representative, as designated by the Contractor.
The PS’s primary point of contact with the Contractor is the Contractor’s site agent (or foreman).
4.7 AUTHORISED PARTY
The DID is required to comply with the procurement and payment procedures set by the Treasury.
Only such person who is duly authorised (Authorised Party) may accept, approve, certify orotherwise act on behalf of the Government, in matters of procurement or administration of contract,irregardless who the Project Head or Superintending Officer / Project Director may be.
Such Authorised Party may be:
An officer, by virtue of his office, or A board or committee duly convened and comprising the relevant officers.
Further details of the Authorised Party and the limit of authority are set out in Chapter 5 – Authority.
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART II : PRE-CONTRACT
CHAPTER 5
AUTHORITY
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Table of Contents
Table of Contents ....................................................................................................................... 5-i
List of Tables……………………………………………………………………………………………………………………….. 5-ii
5.1 INTRODUCTION ............................................................................................................. 5-1
5.2 AUTHORISED PARTY....................................................................................................... 5-1
5.3 LIMITS OF AUTHORITY................................................................................................... 5-1
5.3.1 Selection of Tenderers ....................................................................................... 5-2
5.3.2 Limit and Authority of Procurement Board for Acceptance of Tenders ................... 5-3
5.3.3 Execution of Contracts ....................................................................................... 5-4
5.3.4 Superintending Officer / Project Director and Contract Administration................... 5-5
5.3.5 Certification under the Terms of Contract............................................................ 5-6
5.3.6 Approval of Variation Order................................................................................ 5-7
5.3.7 Instruction for Variation for Special Cases ........................................................... 5-8
5.3.7 Expenditure of Provisional Sums ......................................................................... 5-9
5.3.8 Approval of Contractor’s Claims for Loss and Expense, Permitted under theContract………………………. .............................................................................……5-9
5.4 CIRCULATION OF DOCUMENTS ....................................................................................... 5-9
5.5 REFERENCES ................................................................................................................ 5-10
APPENDIX 5A Distribution of Documents for Works Funded by Federal Government[Pengedaran Dokumen-Dokumen (Kontrak Kerja) Biayaan Persekutuan] .......... 5A-1
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List of Tables
Table Description Page
Table 5.1 Selection of Tenderers 5-2
Table 5.2 Acceptance of Tenders 5-3
Table 5.3 Execution of Contracts 5-4
Table 5.4 Contract Administration 5-5
Table 5.5 Terms of Contract 5-6
Table 5.6 Approval of Variation Order 5-7
Table 5.7 Special Cases 5-8
Table 5.8 Provisional Sums 5-9Table 5.9 Loss and Expense 5-9
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5 AUTHORITY
5.1 INTRODUCTION
This chapter provides:
A brief explanation on the demarcation between administration of contract, and the authority toaccept, approve or certify on behalf of the Government.
The types and limits of authority applicable to contracts let by the DID. Circulation of documents to the relevant parties.
5.2 AUTHORISED PARTY
The DID complies with the procurement guidelines set under the current relevant TreasuryInstructions.
The person who is duly authorized (‘Authorised Party’) may accept, approve, certify or otherwise acton behalf of the Government, in matters of procurement or administration of contract, irregardlesswho the Project Head or Superintending Officer / Project Director may be.
Such Authorised Party may be:
An officer, by virtue of his office, or A board or committee duly convened and comprising the relevant officers.
The limit of authority is usually dependent on the value or estimated value of the contract.
5.3 LIMITS OF AUTHORITY
For pre-contract and post-contract procedures, all actions requiring acceptance, approval orcertification and the Party who is authorised to act on behalf of the Government / DID are set out inthe following sub-sections.
Notwithstanding these summaries, reference should be made to the latestDID circulars, Treasury Circulars and Treasury Instructions for the currentlimits of authority, or for further details.
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5.3.1 Selection of Tenderers
In general any works estimated exceeding RM200,000 or supplies which value exceeding RM200,000per annum for each item must be procured through open tenders with the exception for supplieswhere the qualified suppliers under each trade is known to be less than five (5) suppliers then
approval from the Chief Secretary of Treasury or State Financial Officer (where applicable) must beobtained before tender notice can be sent through registered letter or express delivery.
The Authorised Party for approval of list of tenderers for selective tenders or direct negotiationpurposes is as follows:
Table 5.1 Selection of Tenderers
Authorised Party Limit of Authority
Works Supplies/ Services
Ministry of Finance Exceeding RM5 million Exceeding RM 5 million
Ministry / Department Procurement Board Up to RM 5 million Up to RM 5 million
Ref : Ministry of Finance Guidelines for Tender Evaluation (January 2008 Edition).
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5.3.2 Limit and Authority of Procurement Board for Acceptance of Tenders
The limit of value and authority of the procurement board for acceptance of tenders is as follows:
Table 5.2 Acceptance of Tenders
Authorised PartyLimit of Authority
Works Supplies / Services
Ministry of Finance a) Open tender -exceeding RM 100million
b) Selective tender –exceeding RM5million
a) Open tender -exceeding RM 50million
b) Selective tender –exceeding RM5million
Ministry / Department Procurement Board a) Open tender - Up toRM 100 million
b) Selective tender – Upto RM5 million
a) Open tender - Up toRM 50 million
b) Selective tender – Upto RM5 million
Federal Procurement Board (State level) a) Open tender - Up toRM 20 million
b) Selective tender – Upto RM1 million
Not permitted toconsider and accepttender for supplies andservices at state level
Where the procurement process requires the approval from the Ministry of Finance, the TenderCommittee shall submit the Procurement Board’s recommendation to the Ministry of Finance forfurther decision. In addition if the decision is not unanimous then it must be referred to the Ministryof Finance.
Ref : Ministry of Finance Guidelines for Tender Evaluation (January 2008 Edition) and AP198.1
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5.3.3 Execution of Contracts
Section 2 of Government Contracts Act 1949 (Revision 1973) states that all contracts made inMalaysia on behalf of the Government shall, if reduced to writing, be made in the name of theGovernment of Malaysia and may be signed by a Minister or by any public officer duly authorised in
writing by a Minister, either specially in any particular case, or general for all contracts below acertain value in his department or otherwise as may be specified in the authorisation.
For the execution (signing) of any contracts, the officer authorised to sign on behalf of the DID is asfollows:
Table 5.3 Execution of Contracts
Authorised Party Limit of AuthorityWorks, Suppliers & Services
Minister of Ministry of Natural Resources andEnvironment
Exceeding RM100 million
Chief Secretary Ministry of Natural Resources andEnvironment
Not exceeding RM100 million
Deputy Chief Secretary I Ministry of Natural Resourcesand Environment
Not exceeding RM30 million
Deputy Chief Secretary II Ministry of Natural Resourcesand Environment
Head of Department at Head Quarters
Not exceeding RM 10 million
Deputy Head of Department at Head Quarters
Divisional Secretary of Administration and Finance,Ministry of Natural Resources and Environment
Not exceeding RM 5 million
Departmental Divisional Directors at Head Quarters
Departmental Directors at State Level
Not exceeding RM 1 million
Departmental Deputy Directors at State Level
Chief Assistant Secretary (Finance) of Administrationand Finance Division, Ministry of Natural Resources andEnvironment
Chief Assistant Secretary (Administration) of Administration and Finance Division, Ministry of NaturalResources and Environment
Not exceeding RM 500,000
Assistant Secretary (Finance) of Administration and Finance Division, Ministry of NaturalResources and Environment
Not exceeding RM 100,000
Ref : Minister of NRE Delegation of Power under Section 2, Government Contracts Act 1949 dated 18February 2009 and AP198.1
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5.3.4 Superintending Officer / Project Director and Contract Administration
For contract administration, the appropriate DID officers to be named as Superintending Officer (JKR Form 203 or 203A) or Project Director (JKR Form DB/T) or to exercise the relevant powers under theconditions of contract, are as follows:
Table 5.4 Contract Administration
ContractSum
SuperintendingOfficer / ProjectDirector
SO Representative / PDRepresentative
Officer(s) empowered to takeaction on behalf of the Government
/ DID in respect of**:
Supervisionby DIDofficer
SupervisionbyConsultant
LiquidatedDamages fornon-completion
Delay andExtension of
time
Determinationof theemployment of Contractor
Effects of Waror Earthquake
Arbitration Mutual
Termination
More thanRM 100.0million
Director Generalor Officernamed by theDirector General
Officernamed bythe DirectorGeneral
AppointedConsultant
Director General Director GeneralNot morethan RM100.0million
Federal Director / State Director / ProjectEngineer
FederalDirector /State
Director /ProjectEngineer
Not morethan RM25.0million
Deputy DirectorGeneral
Deputy DirectorGeneral
Not morethan RM10.0million
ProjectEngineer /DistrictEngineer
TheSuperintendingOfficer /ProjectDirector namedin the Contract
TheSuperintendingOfficer /ProjectDirector namedin the Contract
Not morethan RM500,000.00
District Engineer Engineer
**Subject Matter Form JKR 203 / 203A Form DB/T
Liquidated Damages for non-completion
Clause 40 Not applicable
Delay and Extension of time Clause 43 Clause 45
Determination of theemployment of Contractor
Clause 51 Clause 54
Effects of War or Earthquake Clause 52 Clause 55
Arbitration Clause 54 Clause 56
Mutual Termination Not applicable Clause 40
Ref: SP JPS Bil 1/2003
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5.3.5 Certification under the Terms of Contract
The DID officer who is empowered to certify (sign) or give recommendation under the terms of thecontract are set out below:
Table 5.5 Terms of Contract
Authorised Party Certificate or Recommendation
Superintending Officer / Project Director Variation Order*
Superintending Officer / Project Director Adjustment of Contract Sum
Superintending Officer / Project Director, orPrincipal SO’s Representative / Principal PD’sRepresentative
Certificate of Practical Completion
Superintending Officer / Project Director Certificate of Non-completion
Superintending Officer / Project Director, orPrincipal SO’s Representative / Principal PD’sRepresentative
Certificate of Sectional Completion
Superintending Officer / Project Director, orPrincipal SO’s Representative / Principal PD’sRepresentative
Certificate of Partial Possession
Superintending Officer / Project Director Certificate of Delay and Extension of Time
Superintending Officer / Project Director, orPrincipal SO’s Representative / Principal PD’sRepresentative
Certificate of Completion of Making Good Defects
Superintending Officer / Project Director Interim Certificate
Superintending Officer / Project Director Final Certificate
* Subject to the approval of the Variation Order Committee. Please refer to Section 5.3.7.
Ref: SP JPS Bil 1/2003
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5.3.6 Approval of Variation Order
Table 5.6 Approval of Variation Order
Authorised Party Limit of Authority(Value of Variation)
Variation Order Committeechaired by the SO or PD named in the Contract
(If the Deputy Director General is the S.O. orP.D., then the Authorised Party shall be the
Variation Order Committee chaired by theDeputy Director General).
Where the original Contract Sum is less thanRM10 million, and the aggregate value of variation works is not more than 10% of theContract Sum,
Or
Where the original Contract Sum is more thanRM10 million, and the aggregate value of variation works is not more than RM 1 million.
Variation Order Committeechaired by the Deputy Director General of DID
Where the original Contract Sum is less thanRM10 million, and the aggregate value of variation works is not more than 20% of theContract Sum,
Or
Where the original Contract Sum is more thanRM10 million, and the aggregate value of variation works is not more than RM 2 million.
Variation Order Committeechaired by the Director General of DID
Where the original Contract Sum is less thanRM20 million, and the aggregate value of variation works is not more than 30% of theContract Sum,
Or
Where the original Contract Sum is more thanRM20 million, and the aggregate value of variation is not more than RM 6 million.
Chief Secretary to the Treasury All other cases
Ref : AP202.2
Note: the officer who applies for or presents the request for Variation Order approval may not bethe chairman of the Variation Order Committee, or be a member of the Committee.
For the composition of the committee please refer to SP JPS Bil 2/2008.
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5.3.7 Instruction for Variation for Special Cases
Table 5.7 Special Cases
Authorised Party Variation Category
Superintending Officer / Project Director Instructions for Variations / Re-measurement of provisional quantities not involving addition orvariation to the original scope of works, andwhich result in reduction in contract sum
Superintending Officer / Project Director Price adjustments as approved by the Treasury
Superintending Officer / Project Director Adjustment of Prime Cost Sum, Provisional Sumand re-measurement of provisional quantities inaccordance with provisions of contract.
Variation Order Committeechaired by the SO or PD named in the Contract
Variation Order Committee chaired by DeputyDirector General
Variation Order Committee chaired by DirectorGeneral
Chief Secretary of Treasury or State Financeofficer where relevant
Re-measurement of provisional quantitieswithout addition or variation to original scope of works
a) value of price increase for the re-measurement of quantities allowed upto30% of original contract sum but notexceeding RM3 million which ever is thelowest
b) value of price increase for the re-measurement of quantities allowed upto
40% of original contract sum but notexceeding RM4.5 million which ever isthe lowest
c) value of price increase for the re-measurement of quantities allowed upto50% of original contract sum but notexceeding RM6 million which ever is thelowest
d) In all other case
Ref : SPP 7/2007 and AP 202 (31 July 2008); SP JPS Bil. 5/2008
For the composition of committee for re-measurement of provisional quantities, please refer to SPJPS Bil 5/2008.
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5.3.8 Expenditure of Provisional Sums
The Authorised Party, for approval of expenditure of Provisional Sums under any contract, is asfollows:
Table 5.8 Provisional Sums
Authorised Party Value
VO Committee at level of SO Not exceeding 1 million
VO Committee at level of Deputy DirectorGeneral
Exceeding RM1 million – RM 3 million
VO Committee at level of Director General Exceeding RM 3 million
5.3.9 Approval of Contractor’s Claims for Loss and Expense, Permitted under the
Contract
Table 5.9 Loss and Expense
Authorised Party Types of Claim
A committeechaired by Head of Department, andincludes the Legal Advisor
Loss and expense due to delay on the part of the Government, and/or due to compliance withstatutory requirements.
A committeechaired by Head of Department, and
includes the Legal Advisor
Discrepancies in or between the contractdocuments.
A committeechaired by Head of Department
Other claims permitted under the conditions of contract.
A committeechaired by Head of Department
Any other costs in connection with fees andcharges for relocation of sewerage, watersupply, electric supply, etc.
Ref : SPP 7/2007 and AP 202 (31 July 2008)
5.4 CIRCULATION OF DOCUMENTS
In the administration of the contract, pertinent documents or information such as:
Letter of Acceptance (Chapter 8) Contract documents (Chapter 9) Certificate of Adjustment of Contract Sum (Chapter 12) Extension of time (Chapter 13) Etc.
must be conveyed to various pertinent parties, who may not be directly connected to the contract.
Refer to Appendix 5A : Distribution of Documents for Works Funded by Federal Government
(Pengedaran Dokumen-dokumen (Kontrak Kerja) Biayaan Persekutuan), and ensure that copies of such documents or information are forwarded to the relevant parties.
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5.5 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars for the limits of authority.
Treasury Circular
(Surat Pekeliling Perbendaharaan)
[1] SPP Bil. 2/1999: Had Nilai Perolehan, Kuasa, Tanggungjawab Lembaga Perolehan DanJawatankuasa Sebutharga.
[2] SPP Bil. 2/2001 (Tambahan Pertama Kepada SPP Bil. 2/1999): Had Nilai Perolehan, Kuasa,Tanggungjawab Lembaga Perolehan Dan Jawatankuasa Sebutharga.
[3] SPP Bil. 11/2001 (Tambahan Kedua Kepada SPP Bil. 2/1999): Perubahan Had Nilai Dan KuasaLembaga Perolehan Agensi
[4] Bil 7 Tahun 2007: Peraturan Arahan Perubahan Kerja (Variation Order)
[5] Bahagian Perolehan Kerajaaan Ministry of Finance: Garis Panduan Penilaian Tender (Edisi Januari2008)
Treasury Instruction(Arahan Perbendaharaan)
[1] AP 198: Setuju Terima Tender[2] AP 202: Arahan Perubahan Kerja[3] AP 203: Pengiraan Nilai Arahan Perubahan Kerja
DID Circulars
(Surat Pekeliling / Edaran JPS)
[1] SPJPS.UB 1/1997: Peraturan dan pihak-pihak Berkuasa Meluluskan Pengukuran Semula KuantitiSementara
[2] (36)dlm. PPS.10/4/2 CUB Jld.3 (27/7/98): Pengedaran Dokumen-dokumen (Kontrak Kerja)Biayaan Persekutuan
[3] (37) dlm. PPS. 10/4/2 CUB Jld.3 (21/9/98): Urusan Dengan Lembaga Perolehan KementerianSumber Asli dan Alam Sekitar & Perbendaharaan Malaysia
[4] SP JPS Bil. 2/2001: Peraturan dan Pihak-Pihak Berkuasa Meluluskan Pengukuran Semula KuantitiSementara (Tambahan Pertama Kepada Surat Pekeliling JPS.UB.1/1997)
[5] SP JPS Bil. 1/2003: Perlantikan Pegawai Penguasa (P.P), Perwakilan Kuasa Pegawai Penguasa(Wakil P.P) Dan Pegawai-Pegawai Yang Diberi Kuasa (PYDK) Dalam UrusanPentadbiran Kontrak.
[6] SP JPS Bil. 2/2008: Peraturan Mengenai Arahan Perubahan Kerja Dan Pelarasan Harga BagiKontrak Kerja
[7] Minister of Natural Resources and Environment: Pemberian Kuasa Di Bawah Seksyen 2 AktaKontrak 1949 tarikh 18 Februari 2009
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 5
– Authority
APPENDIX 5A
Distribution of Documentsfor Works Funded byFederal Government
[Pengedaran Dokumen-Dokumen(Kontrak Kerja)
Biayaan Persekutuan]
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APPENDIX 5A DISTRIBUTION OF DOCUMENTS FOR WORKS FUNDED BY FEDERAL GOVERNMENT [PENGEDARAN DOKUMEN-DOKUMEN(KONTRAK KERJA) BIAYAAN PERSEKUTUAN]
Item Office Letter of
AcceptanceContract
Document
Adjustmentof Contract
Sum
Certificateof Delayand
Extensionof Time
Certificateof Non-
completion
Certificate of
Completion/Certificate of
Completion of Making Good
Defects
1. Chief Secretary,Ministry of NaturalResources andEnvironment
√ √ √ √ √ √
2. Auditor General √ √ √ √ √ √
3. Internal Audit Unit,Ministry of NaturalResources and
Environment
√
4. Director General,Board of IncomeTax
√
5. Banks/ InsuranceCompanies
√ √ √ (AR) √ (AR) √
6. Pusat KhidmatKontraktor
√ √ √ √
7. CIDB √
8. State Labour Office√
9. State PERKESO √ √
10. Contractor √√ (AR) √√ (AR) √ √ √ √
11. Divisional Director,DID HQ
√ √√ √ √ √ √
12. Director QSCD√
#√√
(original) √ √ √ √
13. * Director AdministrationService , DID HQ
√ √ √ √ √ √
14. ** Senior AccountantTreasury (State)
√ √ √ √ √ √
15. State Director/Project Engineer
√ √√ √ √ √ √
16. Consultants (if any) √ √√ √ √ √ √
17. Ministry of Finance,GovernmentProcurement
AdministrationDivision (For directnegotiated contractsonly)
√ √
Notes:√√ - Contract Documents and Plans
AR - Registered Post
* - if payment made at HQ only** - if payment made at State only# - Contract exceeding RM 1 million only
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART II : PRE-CONTRACT
CHAPTER 6
PREPARATION OF
TENDER DOCUMENTS
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Table of Contents
Table of Contents .......................................................................................................................6-i
List of Flowcharts ......................................................................................................................6-ii
6.1 INTRODUCTION ............................................................................................................. 6-2
6.2 PROCEDURES................................................................................................................. 6-2
6.3 GUIDANCE NOTES.......................................................................................................... 6-6
6.3.1 Prime Cost (P.C.) And Provisional Sums ............................................................... 6-6
6.3.2 Tender Documents And Tender Table Documents ................................................ 6-6
6.3.3 Pre-bid Documents for Design-and-Build ............................................................. 6-7
6.4 REFERENCE DOCUMENTS ............................................................................................... 6-7
6.5 REFERENCES.................................................................................................................. 6-8
APPENDIX 6A Tender Document Checklist ............................................................................ 6A-1
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
List of Flowcharts
Flowchart Description Page
Flowchart 6.1 Preparation of Tender Documents 6-1
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Flowchart Description Action By Reference
1. Estimated cost of worksqualifies it for tender process,
and instruction from PjH toproceed is received.
PT Chapter 3 – Procurement -
Overview
2. Prepare front-end sections. PO Tender Document
Checklist
3. Prepare Summary of Tender /Bills of Quantities
PO
4. Forward queries (if any) toDesign Team for comments
PO
5. Edit Summary of Tender / Billsof Quantities
PO
6. Check that document iscomplete and in proper order
PO
7. Convene Design Team / QScoordination meeting, if necessary
PO
8. Incorporate comments orchanges, and prepare finalTender Document
PO
9. Quality Audit BUBK
10. Tender Document ready forprinting and issue
PO
Flowchart 6.1 – Preparation of Tender Documents
1
2
4
5
10
6
3
7
8
9
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
6 PREPARATION OF TENDER DOCUMENTS
6.1 INTRODUCTION
This chapter provides:
The guidelines on the preparation of tender documents.
6.2 PROCEDURES
Please refer to Flowchart 6.1 – Preparation of Tender Documents.
Step Procedures / Tasks Action By
/ Reference
1 Generally
The tender documents should contain accurate informationand definitive scope of works.
This minimises ambiguity, and reduces the need for variationsduring construction stage. This may also reduce the risks of disputes arising from discrepancies in or between thedocuments.
For information
(a) Ascertain that the estimated cost of works qualifies it for tenderprocess
For tender, the estimated cost of works is morethan RM200,000.
If less than RM200,000 – refer Guidelines onPreparation for Quotation Document
(b) Ascertain the procurement route agreed
Conventional (with quantities)
Conventional (without quantities)
Design and Build
Special project.
(c) Commence preparation of tender documents upon receiptof instruction to proceed from the Project Head
Action By:PT
AP 171 &
AP 181
See Chapter 3 – Procurement -
Overview
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Step Procedures / Tasks Action By
/ Reference
2 Prepare Front End Sections
(a) Collate and prepare the documents required for the Tender
Document in accordance with the DID requirements andstandardized format. Ensure that the documents:
Clearly and concisely defined the works to beexecuted.
Are consistent with one another and free of ambiguity. Have included and highlighted all the bye-laws and
Authorities requirements. Comply with the latest policies and circulars.
(b) Draft the tender documents from the standard DIDdocuments.
(c) Prepare/compile specifications for the Tender Document.
(d) Prepare Notice of Tender and/or Letter of Invitation toTenderers, for insertion into the tender document: Pleaserefer Chapter 7 [Invitation and Receipt of Tender].
(e) Use the Tender Document Checklist as guidance.
(f) Agree with the Design Team
Programme for receipt of information, request for
progressive release of drawings System of numbering drawings Numbers of sets required Revision notation Items to be covered by Prime Cost or Provisional
Sums.
(g) Obtain/register the tender/contract number, and insert onthe cover page. Ensure that the correct format/code isused, with reference to:
Federal/State funded project The state in which the project is carried out Code for types of works / Division Running Number Year
e.g. “JPS/P/J/S/1/99” for Federal funded project,administered in Johor for drainage works/Division, beingthe first tender for year 1999. Re-tendered works uses theold tender number, with the words “Tawaran Semula” appended at the end. Note that sub-contracts shall followthe main contract number.
Action By:Ir/Sr
Refer Sections
6.5 & 6.6
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Step Procedures / Tasks Action By
/ Reference
2a Design and Built Pre-bid Documents
(a) For design-and-build projects, the Pre-bid documents are
documents prepared in anticipation of contractor’sproposal (or ‘bid’).
It includes the Government’s needs statement (orrequirements). The Contractor’s proposal must complywith the requirements set out in the Pre-bid Document.
(b) Collate and prepare the Pre-bid Documents in accordancewith the DID requirements and standardized format.Ensure that:
The Government’s Needs Statement clearly identifies
the design criteria including performance criteria (andspecifications, if applicable) for the works, and thepurposes of the works.
The Pre-bid Documents are consistent with one anotherand free of ambiguity.
Comply with the latest policies and circulars.
(c) Draft the tender documents from the standard DIDdocuments.
(d) Prepare Notice of Tender and/or Letter of Invitation toTenderers, for insertion into the tender document: Pleaserefer Chapter 7 [Invitation and Receipt of Tender].
For information
Action By:PO
3, 4 & 5 Design Team Coordination Meeting
Prepare the Bills of Quantities / Summary of Tender – referTender Document Checklist.
Forward queries, if any, to the Design Team for comments orclarification.
Incorporate all comments and/or clarification, as appropriate.
The completed Bills / Summary should be edited and checkedby a senior QS/Engr.
Action By:PO
6 Check that Document is Complete and In Proper Order
Check through the documents, and ensure that it is completeand in proper order.
Cross references, if any, should be correctly referred.
Action By:PO
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Step Procedures / Tasks Action By
/ Reference
7 Convene Design Team And Ir/Sr Coordination Meeting, If Necessary
If necessary, arrange coordination meeting between DesignTeam and PO, to answer queries on the drawings and/orspecifications, or give comments and clarifications on thetender document.
Action By:PO
8 Incorporate comments or changes and prepares final TenderDocument
Incorporate all comments or changes to the tender document.
Action By:PO
9 Quality Audit
Forward a full set of the finalised Tender Document, together
with the Tender Document Checklist to the BUBK for qualityaudit.
Action By:PO /BUBK
10 Tender Document Ready For Printing And Issue To Tenderers
Arrange for the printing the required number of sets of theTender document.
Arrange for the display of the Tender Table Document.
Issue invitation to tenderers : Please refer to Chapter 7[Invitation and Receipt of Tender].
Action By:PO
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
6.3 GUIDANCE NOTES
6.3.1 Prime Cost (P.C.) And Provisional Sums
“Prime Costs Sum” or “P.C. Sum”, and "Provisional Sum" may be included in the Bills of Quantities, or
Summary of Tender.
“Prime Costs Sum” or “P.C. Sum” is an amount included in a bill of quantities to cover a particular bitof work or supply of materials to be carried out by a nominated sub-contractor or a supplier.
o These are usually specialist works or supplies.
o The Bills of Quantities or Summary of Tender should allow the Contractor to price for the ‘profit and attendance’ associated with the works or supplies.
o Where the Contractor is capable of carrying out such specialist works or supplies, the SO isempowered to accept the Contractor’s tender for such works or supplies. The Contractor’s
tender is deemed to include the profit and attendance, and no further profit and attendancewill be paid.
"Provisional Sum" means a sum included and so designated in the Contract as a specific allocationfor the execution of work or the supply of goods materials or services which may be used in whole orin part or not at all at the direction and discretion of the SO.
o Allow for the Contractor’s profit margin in the Provisional Sum.
o At the SO’s discretion, works or supplies to be executed or supplied under Provisional Sumsmay be treated as allowed under P.C. Sums.
As far as possible, provide a reasonably accurate amount for the P.C. Sum or Provisional Sum.
Please also refer to Chapter 20 [Prime Cost and Provisional Sums].
6.3.2 Tender Documents And Tender Table Documents for Conventional Contracts
The Tender Documents and Tender Table Document comprise the documents in the following order:
Notice of Tender / Letter of invitation to tenderers / Letter of Intent (whichever is applicable) Check List of submission of tenders Instructions to Tenderers & Conditions of Tendering Form of Contract
o Based on Quantities – use Form JKR 203A
o Based on Drawings and Specifications – use Form JKR 203 Special Provisions to Conditions of Contract Form of Tender
o Based on Quantities – use Form JKR 203Bo Based on Drawings and Specifications – use Form JKR 203C
Letter of Acceptance (JKR 203D) Specifications Preambles Bills of Quantities, OR Summary of Tender and Schedule of Rates. Drawings Form of Guarantees for Performance Bond/Advance Payment Informative Document
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
6.3.3 Pre-bid Documents for Design-and-Build Contract
The Pre-Bid Documents comprise the documents in the following order:
Notice of Tender / Letter of invitation to tenderers / Letter of Intent (whichever is applicable) Instructions to Tenderers & Conditions of Tendering Form of Contract – PWD Form DB/T Form of Tender Letter of Acceptance The Government’s Requirements (Needs Statement) Form of Guarantees for Performance Bond/Advance Payment Informative Document
6.4 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
Tender Document Covers
Table of Contents
Notice of Tender
Letter of Invitation to Tenderers
Checklist for Submission of Tender for Use by Tenderers (Senarai Semakan MengemukakanTender Untuk Kegunaan Pentender)
Instructions to Tenders
Amendments to Form PWD 203
Amendments to Form PWD 203A
Special Provisions to Conditions of Contract
Form of Tender & Conditions of Tendering JKR 203B (for JKR 203A)
Form of Tender & Conditions of Tendering JKR 203C (for JKR 203)
Letter of Acceptance JKR 203D
Sample Format for Bills of Quantities
Form of Guarantee for Performance Bond
Form of Guarantee for Advance Payment Bond
Sample Drawings List
Informative Documents
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
6.5 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on preparation of tender documents.
Treasury Circular
(Surat Pekeliling Perbendaharaan)
[1] Bil 13 Tahun 1999: Garis Panduan Penggunaan Khidmat Pengangkutan dan KemudahanPeralatan Untuk Menguruskan Projek Melalui Kontrak Kerja
[2] Bil 7 Tahun 2002: Penggunaan Bahan/Barangan/Perkhidmatan Tempatan Dalam PerolehanKerajaan
[3] Bil 5 Tahun 2007: Tatacara Pengurusan Perolehan Kerajaan Secara Tender
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPT 3/1987: Peruntukan "Contingency Sum" Dalam Dokumen Tender
[2] SPJPS.CUB 1/1992: Pindaan kepada Borang Kontrak PWD 203 (revised 10/83), PWD 203A (revised 10/83), JKR 203B-Pin. 1/82, JKR 203C- Pin. 1/82 dan JKR 203D- Pin. 1/82.
[3] SPJPS.UB 2/94: Format Muka Hadapan dan Pemberian Nombor Kepada Dokumen Tender/Kontrak.
[4] Tambahan Pertama SPJPS.UB 2/94: Tambahan Pertama Kepada Surat Pekeliling JPS.UB 2/94.
[5] SPJPS.UB 4/1994: Garispanduan Menetapkan Amaun Denda Gantirugi Tertentu dan Ditetapkan.
[6] SPJPS 3/1995: Peraturan Penyedian Dokumen Tender dan Kontrak
[7] SPJPS.Bil. 4/1999: Format Muka Hadapan dan Pemberian Nombor Kepada DokumenTender/Kontrak
[8] SPJPS Bil. 5/2000: Peruntukan Baru Dalam Dokumen/Tender Dan Pindaan-Pindaan KepadaBorang Kontrak JKR 203/203A, Borang Tender Dan Surat Setujuterima Tender.
[9] SPJPS 1/2001: Garispanduan Penggunaan Khidmat Pegangkutan Dan Kemudahan PeralatanUntuk Pengurusan Projek Melalui Kontrak Kerja.
[10] SPJPS Bil. 1/2002: Penerimaan Jaminan Syarikat Kewangan Berlesen Dan Insurans Bagi BonPelaksanaan Serta Bayaran Wang Pendahuluan. (Perlaksanaan Surat Edaran PerbendaharaanBertarikh 4 Februari 2001)
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 6
– Preparation of Tender Documents
APPENDIX 6A
Tender Document Checklist
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
APPENDIX 6A TENDER DOCUMENT CHECKLIST
PROJECTTITLE
File Ref.:
Estimate Contract Sum: Allocation/ Funder:
Tender Type:
Action by Name of Officer Send Date Receipt
DateCompletion
Date
PO 1
PO 2
QA 2
Item No. Description1 PO1 PO2 QA 2 Comments
Tick () after checking
1.0 Cover Page Format andregistration of Tender Nos.
The correct procedure isadopted.
2.0 Notice of Tender
2.1 Correct Head and Subhead Ref.: SPP 16/1993
2.2 Correct class of Contractor.
2.3 State the type of companies whichare eligible to participate, base onthe estimated value of the tender
1. Ref.: SPP 5/2007 –Eligibility of Contractors.3
2.4 To state if tender is only forBumiputera Contractors.
2.5 Correct place of buying tender.
2.6 Amount of documentation fee4 andin whose name to be made, isstated.
2.7 Site visit – date, time & placestated.To state if compulsory
2.8 Date, time and place for closing of tender is stated.
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
3.0 Instructions to Tenderers
3.1 Where and when tender closes.
3.2 Amount and other articulars of Tender Deposit (for InternationalContracts only)
3.3 Include clause on informationregarding tenderer’s Financial andTechnical Capacity if tender is>RM1.0m.
Ref.: SP JPS. UB.3/1994
3.4 If funded by international body,ensure that their guidelines for
procurement are complied with.
3.5 Include clause regardingcorrection of errors forinternationally funded tenders.
4.0 Form of Contract
4.1 Use correct form.
4.2 Articles of Agreement
The following to be filled in:
1 Paragraph 1
(i) Name of Government. For Federal Projects -Government of Malaysia.
For State Projects- Name of relevantState.
(ii) Description of intendedWorks.
(iii) Drawing nos/as stated inlist of drawings.
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
4.2(Cont’d)
4.2.2 Clause 2(e)
Special Provisions to
Conditions of Contract.(i) Advance Payment clause(ii) Variation of Price clause(iii) Performance Bond in the
Form of PerformanceGuarantee Sum
(iv) Performance Bond in theForm of PerformanceGuarantee Sum
Choose relevant one only
4.2.3 Clause 2(I) – New Clause
Amendments to PWD Forms.
4.3 Conditions of Contract
The following to be filled in:
4.3.1 Clause 1(a)(i)
Same as item 4.2.2 and 4.2.3
4.3.2 Clause 1(a)(iv)
Check designation of S.O. iscorrect.
Ref.: SP JPS Bil.1/2003
4.3.3 Clause 26(d) (203A only)
Delete this clause if funded byInternational body.
4.4 Appendix to Conditions of Contract
The following to be filled in:
4.4.1 Clause 3(a)(i)Clauses 40 and 43 andClauses 51, 52 and 54 aredesignated to the correctOfficers.
Ref.: SP JPS Bil.1/2003
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
4.4
(Cont’d)
4.4.2 Clause 3(a)(ii)
Powers to approve Variations
in accordance with latestTreasury and JPS circulars
Ref.: AP202.2
4.4.3 Clause 33
Minimum insurance coverageis sufficient5
4.4.4 Clause 33(a) and 36(b)
Amount of excess – Nil
4.4.5 Clause 34
Not used.
4.4.6 Clause 36
Insert the following
‘Total Amount Insured’
... ... ... RM ...............
4.4.7 Clause 38(b)
Date for Possession – ‘To beDetermined’.
4.4.8 Clause 40
Check if the rate of Liquidated and Ascertained
Damages is reasonable6.
4.4.9 Clause 41
Sectional Completion- To be filled if required.
4.4.10 Clause 45
Defects Liability Period in
accordance with Arahan
Perbendaharaan 200.5(a).7
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
4.4(Cont’d)
4.4.11 Clause 47(a)
(i) Value of work done
before First InterimCertificate will be issued5% of Builder’s work orRM100,000 whichever islesser.
(ii) Value of work donebefore each subsequentinterim certificate will beissued – 15% of averagemonthly value of Builder’s Work or ½ of the first interim
payment, whichever islesser.
4.4.12 Period for honouringpayment
Sufficient period to bestated but not lessthan 30 days.
5.0 Special Provisions to Conditionsof Contract
5.1 Advance Payment
5.1.1 Use correct SpecialProvision.
5.2 Variation Of Price
5.2.1 Use correct Special Provision / forms.
5.2.2 Quantity of steel bars andcement are stated inLampiran……..... if required
for the works.
5.2.3 Forms for estimation of diesel consumption & bitumen are included.
5.2.4 Complete the forms, andenter the relevant information
Ref.: SPP 3/2008
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Item No. Description1 PO1 PO2 QA 2 Comments
5.3 Performance Bond in the Form of Performance Guarantee Sum
5.3.1 Use correct SpecialProvision.
5.4 Restriction and Procedure on Useof Imported Good/Materials
5.4.1 Use correct SpecialProvision.
5.5 Amendments to Standard PWDforms
Use correct amendments.
6.0 Form of Tender
6.1 Use the correct form.
6.2 The following are filled in:-
6.2.1 Title of tender
6.2.2 List of drawings includingchecking the number of drawings against the List of Drawings.
6.2.3 Completion period (fixed byDepartment).
Ensure period of completionfixed by the Department isreasonable, taking intoaccount factors like urgency,complexity and rainyperiods.
6.2.4 Prime Cost or ProvisionalSums if applicable.
6.3 Tender validity period is amended. 90 days forconventional contracts.180 days for DBcontracts.
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
9.0 Preamble
9.1 To check the unit of measurement
as stated in the preamble isconsistent with the measurementin the Bills for the various items.
9.2 The method of measurement isstated.
9.3 The method of measurement doesnot give rise to unnecessary orimpractical maintenance of siterecords.
9.4 The general composition of theunit rate is stated.
9.5 No duplication in the measurementof items.
10.0 Bill of Quantities
10.1 A general look at the quantities toensure no obvious mistakes.
10.2 All necessary dimensions are given
10.3 All necessary items are measured. No ‘Rate Only’ items.(Items withoutquantities).
10.4 P.C. Sum – to include item forProfit (%) and attendance (LumpSum).
No ‘Contingency Sum’ items.
10.5 Amounts for P.C and ProvisionalSums stated in ‘Amount’ column.
10.6 Item descriptions are concise,consistent and accurate.
10.7 Item description to correspond todrawings and/or specification.
10.8 Cross References and Specificationclause Nos. correct.
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
10.9 All sections of the Bill of Quantitiesare carried to the Summary.
10.10 Summary page provided.
11.0 Summary of Tender (For ContractBased on Form JKR203)
11.1 For Lump Sum items, statementon quantities should be avoided,otherwise ensure consistency withthose stated in specifications anddrawings.
12.0 Drawings
12.1 Drawings must be clear and up todate
12.2 Drawing Nos. tally with list of drawings.
12.3 Drawings for works based onLump Sum tender must becomplete and scope/extent of works are coloured if necessary
13.0 Form of Guarantees forPerformanceBond/Advance Payment
Ref.: SPP 5/2007
13.1 Use correct form.
13.2 Latest list of Approved Banks & Insurance Companies attached
14.0 Informative Documents Ref.: SP JPS 3/1994
14.1 All standard forms areincorporated
14.2 Form BA (Bank/FinancialInstitution Report) attached, notbound.
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
Item No. Description1 PO1 PO2 QA 2 Comments
15.0 General
15.1 All tender documents must be
carefully prepared and completeso as to give effect to theexpressed requirements of theDepartment.
15.2 The work to be executed must beclearly and concisely defined andspecified, consistent with oneanother and free of ambiguity.
15.3 Documents must be free of
inconsistencies and discrepanciesbetween the various sections andthe drawings.
15.4 Ensure that all bye-laws and Authorities requirements areincluded and highlighted in thetender documents:
15.5 Complies with the latest policiesand circulars
Signature of Checking OfficerDate of Completion of Task:
Signature of Verifying OfficerDate of Completion of Task:
Signature of Quality AuditorDate of Completion of Task:
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
1ENDNOTE:
1 This Checklist may be adapted for the Design and Build / Turnkey Contract, with relevantchanges to the Clause reference.
2 Quality Audit; If Relevant.
3 Estimated Tender Value, and Eligibility of Contractor to Register: SPP 5/2007
Estimated Tender Value Eligibility
< RM 30 million (a)
RM30 – RM50 million (a) dan (b)
> RM50 million (a), (b) or (c)
Classification / Eligibility to register
(a) Local company wholly (100%) owned by Malaysian citizens.
(b) Local company listed on the Bursa Malaysia, that is, a company incorporated in Malaysiaby Malaysian citizens with condition that no foreign shareholder may hold more than30% of the shares, and the board of directors, management and staff are wholly(100%) Malaysian citizens.
(c) Joint venture company incorporated in Malaysia (whether or not listed on the KLSE),
with the condition that foreign equities do not exceed forty nine percent (49%), andmajority members of the Board of Directors, management and staff and Malaysiancitizens.
4 Documentation fee & Drawings
Documents Drawings
A4 @ RM 0.35 = A3 @ RM0.70 =
A3 @ RM 0.70 = A2 @ RM3.50 =
A1 @ RM6.50 =
A @ RM8.00 =
Total = Total =
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Chapter 6 – PREPARATION OF TENDER DOCUMENTS
ENDNOTE: (Cont’d)
5 Minimum insurance coverage for third party (public liability) insurance. The followingamounts may be used as a guide:
Contract Sum limits of liability a.o.a. for Unlimited
Number of Accidents
Not exceeding RM 50,000 RM10,000
RM 50,001 to RM 100,000 RM25,000
RM 100,001 to RM 200,000 RM50,000
RM 200,001 to RM 500,000 RM100,000
RM 500,001 to RM 5.0 million RM200,000
RM 5.0 million to RM 20.0 million RM500,000
RM 20.0 million to RM 50.0 million RM1.0 million
Exceeding RM 50.0 million RM2.0 million
6 Liquidated and Ascertained Damages at the rate of : [(BLR*/365)% x Contract Sum] perday. *BLR = Base Lending Rate
7 Guideline for Defects Liability Period:
Contract Sum Defects Liability Period
RM20,000 – RM200,000 6 months
> RM200,000 12 months
Design and Build/ Turnkey 24 months
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART II : PRE-CONTRACT
CHAPTER 7
INVITATION AND
RECEIPT OF TENDER
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Table of Contents
Table of Contents .......................................................................................................................7-i
List of Flowcharts ..................................................................................................................... 7-ii
7.1 INTRODUCTION.......................................................................................................... 7-3
7.2 PROCEDURES ............................................................................................................. 7-3
7.3 REFERENCE DOCUMENTS.......................................................................................... 7-10
7.4 REFERENCES ............................................................................................................ 7-10
APPENDIX 7A Checklist for Tender Opening Committee (Senarai Semakan OlehJawatankuasa Pembuka Tender)…………………..……………………………………………. 7A-1
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
List of Flowcharts
Flowchart Description Page
Flowchart 7.1 Flowchart – Invitation and Receipt of Tender (Open / Selective) 7-1
Flowchart 7.2 Flowchart – Pre-Qualification of Contractors 7-2
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Flowchart Description Action By Reference
1. Applicable for Open &
Selective tendering.
2. Is it open tender?
- See Chapter 3
-
3. Selection of Tenderers by Authorised Party?
PO
4. Select Tenderers PO
5. Undertake Pre-Qualification of Tenders
Various parties Refer to Flowchart 7.2
6. Is the List of Tenderersapproved?
ProcurementBoard / MoF
See Chapter 5
- Authority
7. Either Re-select tenderers, or Proceed with open tender
process
8A. Prepare and issue Noticeof Tender (Open)
PO
8B Prepare and issue Letterof Invitation (Selective)
PO
9. Sale of / Issue TenderDocument
PO
10. I ssue Addendum (if any) PO
11. Prepare Tender estimates PO
12. Convening of TenderOpening Committee
BUBK
13. Closing / Receipt of tender BUBK/ TenderOpening
Committee
14. Tender evaluation See Chapter 8
Flowchart 7.1 – Invitation and Receipt of Tender (Open / Selective)
Yes
No
Open Selective
1
14
8A
9
10
2
6
11
12
13
7
3
4 5
8B
No Yes
Yes
No
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Flowchart Description Action By Reference
5a. Ascertain the criteria forselection of contractors
PT / PO From Flowchart
7.1, step 3
5b. Prepare and issue Noticeof Tender for Pre-qualification
PO
5c. Receive submissions fromcontractors.
PO
5d. Evaluate the submissionfrom contractors.
EvaluationOfficer
5e. Prepare Pre-Q evaluationreport (Kertas laporanpenilaian)
PO
5f. Endorsement of Pre-Q
Evaluation Report
Evaluation
Committee
5g. Approval of Pre-QEvaluation Report
DG
5h. Submit Pre-Q evaluationreport to ProcurementBoard for approval
BUBK
5i. Decision and approval ProcurementBoard
5j. Notify the unsuccessfulcontractors
PO Return to
Flowchart 7.1,step 6
Flowchart 7.2 – Pre-Qualification of Contractors
5a
5b
5c
5d
5e
5j
5f
5g
5h
5i
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
7 INVITATION AND RECEIPT OF TENDER
7.1 INTRODUCTION
This chapter provides:
The guidelines on the invitation, receipt and opening of tenders.
7.2 PROCEDURES
Please refer to Flowchart 7.1 – Invitation and Receipt of Tender (Open/Selective).
Step Procedures / Tasks Action By
/ Reference
1 & 2 Determine procurement procedure adopted
Determine procurement procedure to be adopted :
Open tender Selective tender Negotiation Quotation
The procedures in Chapter 7 to Open and Selective Tenderingonly.
Refer Chapter 3 on the description of the procurementprocedures.
For information
3 Selective Tender
Owing to the specialist nature and complexity of requirementsof certain projects, it may be desirable to invite a tender fromselected tenderers.
Such special requirement may include:
Complexity of nature of works
Urgency Limited pool of specialist contractors Special safety and/or environmental requirements National security.
Action By : PO
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Step Procedures / Tasks Action By
/ Reference
4 List of Tenderers selected by Authorised Party
This method usually applied where there is insufficient time toundertake a pre-qualification exercise.
The tenderers are selected from PKK’s (Pusat KhidmatKontraktor) database of contractors with good track records.
The selection of tenderers is based on:
Requirement of specialist skills or knowledge, Safety, and Urgency.
The List of Tenderers shall be proposed by the Project Head /Project Team.
The list shall be submitted, through BUBK, to DG for approvalprior to submission to the Tender Procurement Board atMinistry/MoF.
Action By : PO
5 Pre-Qualification - Generally
The purpose of the pre-qualification exercise is to ensurecontractors who are suitably qualified are invited to tender.
Generally, the tenders are assessed on:
General reputation of the tenderer. Capability, based on management, personnel, number
of technical staff Track records (and recent work experience) Available capacity in relation to the current workload. Financial stability and record. Other relevant criteria.
Refer to Flowchart 7.2 – Pre-
Qualification of Contractors
5a Ascertain the Criteria for Selection of Contractors
Ascertain and agree with the Project Team the criteria for
selection of contractors.
For selection under Procurement Board, at least 10 Bumiputracontractors must be included.
Refer to current DID/Treasury Circulars on selection of contractors.
Action By : PT/PO
Refer SPP 5/2007
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Step Procedures / Tasks Action By
/ Reference
5b Prepare and issue Notice of Tender for Pre-Qualification
Ensure that the details are correctly filled in the Notice.
The Notice must be:
State the qualifications and other special requirements,required of the tenderers.
Be published in at least 1 national daily newspapers (inBahasa Malaysia).
Published at relevant websites, e.g. DID website, MyGovPortal (www.gov.my) and CIDB website.
Action By : PO
5c Receive Pre-Qualification (Pre-Q) Submissions
The closing date, time and office where the Pre-Q submissionsis received, is stated in the Notice of Tender for Pre-Q.
Submissions shall be opened by an Opening Committee (seeTender Opening Committee, Chapter 7).
Late submissions must be rejected without opening.
Forward the submissions received to the Evaluation Officer.
Action By : PO
Action By : BUBK
5d Evaluate Pre-Qualification (Pre-Q) Submissions
The Evaluation Officer will evaluate the submissions received,based on the pre-agreed criteria (see Step 5a, above).
Action By :Evaluation Officer
5e Pre-Qualification (Pre-Q) Evaluation Report
Prepare the Pre-Q Evaluation Report (Kertas Laporan Penilaian)in the approved format, with list of qualifying contractors, forsubmission to the Tender Procurement Board.
Action By :Evaluation Officer
5f & 5g Endorsement & Approval of Pre-Q Evaluation Report
The Pre-Q Evaluation Report shall be submitted to theEvaluation Committee for review and endorsement.
Submit recommendations to the Director General, throughBUBK, for the DG’s approval prior to submission to the TenderProcurement Board at Ministry.
Action By :Evaluation Officer
Action By : BUBK
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Step Procedures / Tasks Action By
/ Reference
5h & 5i Submission to the Procurement Board for Decision
Present the Pre-Q Evaluation Report to the Procurement Boardfor decision.
Prepare the list of approved or short-listed contractors.
Action By : PO /Procurement Board
Action By : PO
5j Notify Unsuccessful Contractors
Notify the contractors who were not approved or short-listed.
Action By : PO
6 & 7 List of Approved Contractors
Only the approved contractors will be invited to tender.
If the short-listed contractors is not approved, then the TenderProcurement Board may either decide to:
• Re-select tenderers, or• Proceed with open tender process
For information
8A Notice of Tender (Open Tender)
For open tenders, prepare Notice of Tender. Ensure that thedetails are correctly filled in.
The Tender Notice must be:
Be published in at least 1 national daily newspapers (inBahasa Malaysia).
Published at relevant websites, e.g. DID website, MyGovPortal (www.gov.my) and CIDB website.
Action by: PO
Refer alsoSPP 5/2007
8B Letter of Invitation (Selective Tender)
For selective tendering, issue Letter of Invitation to the listedtenderers. Ensure that the details are correctly filled in.
Action by: PO
Refer alsoSPP 5/2007
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Step Procedures / Tasks Action By
/ Reference
9 Sale of / Issue Tender Document
Sale of document shall be made during office hours through outthe tender period
Check that
The person collecting the tender documents isauthorized to do so.
The contractor’s registration(s) are still valid.
The Contractor’s details are correctly and completelyentered onto the Form of Tender, and in the
information box stamped onto the front cover of theTender Documents.
Where the contractor’s registration(s) had expired, the sale maybe carried out if the contractor signed and returned theconditional letter for sale of the tender document, stating thatthe tender will not be accepted if the contractor fails to renewhis registration(s) prior to the tender closing date.
The proceeds from the sale of tender documents shall becredited to the revenue.
Tender deposits (where applicable) shall be credited to “security
deposit” account, for eventual refund to the tenderers.
Minimum Tender Period
The tender period shall be as follows:
Conventional tenders: at least 21 days from
o the 1st day of sale of tender documents isavailable, as notified in the Tender Notice, or
o 21 days from the site visitwhichever is the later.
Design and build tender: at least 45 days from the 1st
day of sale of tender documents [This is pendingapproval from top management] is available, as notifiedin the Tender Notice.
Action by: PO
Refer: SPP 5/2007,pages 17 & 18
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Step Procedures / Tasks Action By
/ Reference
10 Issue Addendum (if any)
Addendum, if necessary, is prepared by the Engr/QS.
Addendum must be issued to all tenders at least 1 week beforethe closing of tender.
The Tender Addendum together with the instructions, listing thepage numbers issued and substitution to be made.
Action by:Engr/QS
11 Prepare Tender estimates
Prepare the tender estimates.
The tender estimate shall be deposited into the tender box prior
to the tender opening date and time, in accordance with theTender Notice.
Action by: Engr/QS
Action by: BUBK
Action by: Engr/QS
12 Appointment of Tender Opening Committee
The Director General shall appoint the Tender OpeningCommittee.
The Tender Secretariat shall facilitate the calling of the TenderOpening Committee, informing them of the closing date, timeand office where tender is received and to be opened.
Action by: DG
Action by: TS
13 Closing / Receipt of tender
The closing date, time and office where tender is received isstated in the Tender Notice and/or Letter of Invitation.
Late tenders must be rejected without opening.
Action by: TS/
Tender OpeningCommittee
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
Step Procedures / Tasks Action By
/ Reference
13(Cont’d)
Closing / Receipt of tender
Opening of tenders & Tender Opening Report
Prepare the Tender Schedule.
The tenders must be collected from the tender box, and alltenders (including the departmental tender estimates) beopened in the presence of the Tender Opening Committee.
Number each tender and enter the details for each tender ontothe Tender Schedule, in the order which the tender is opened.
For public tender opening, read aloud and check that the details
are entered correctly. Ensure that the Tender Schedule iscomplete and is signed by all relevant officers.
A copy of the completed Tender Schedule must be displayed atthe office where the tender was closed.
Forward the tender documents received and the completedTender Schedule to the office where the tender was called forevaluation.
Action by: TS/Tender Opening
committee
14 Tender evaluation
See Chapter 8 – Tender Evaluation and Acceptance
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
7.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
Notice of Tender Letter of Invitation to Tenderers Sample stamp (chop) for ‘Maklumat Pendaftaran Kontraktor’ Conditional Letter for sale of tender document Jadual Tender
7.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the calling and receipt of tenders.
Treasury Circular
(Surat Pekeliling Perbendaharaan)
[1] Bil 5 Tahun 2007: Tatacara Penguruasan Perolehan Kerajaan Secara Tender
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPT.CUB 1/1989: Penyediaan Anggaran Jabatan Mengenai Sesuatu Tender
[2] SP JPS. UB 1/1993: Garispanduan Mengenai Pengurusan Tender
[3] SP JPS.UB 3/1993 : Surat Pemberitahuan Penerimaan Tender
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 7
– Invitation and Receipt of Tender
APPENDIX 7A
Checklist forTender Opening Committee
(Senarai Semakan OlehJawatankuasa Pembuka Tender)
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
APPENDIX 7A CHECKLIST FOR TENDER OPENING COMMITTEE (SENARAISEMAKAN OLEH JAWATANKUASA PEMBUKA TENDER)
No.
Tender
TAJUK PROJEK
Tarikh Tender Ditutup: Jenis Tender: Kelas/Kepala/Sub-Kepalayang ditetapkan:
Haribulan:
Jam:
BIL. KETERANGAN JKPT* ULASAN
1.0 Peti tawaran dibuka secepat mungkin selepastender ditutup.
Tandakan ()selepas semakan
2.0 Semak keseluruhan dokumen yang dikemukakan(submission) dan pastikan ianya mengikut peraturanyang sepatutnya.
Catatkan sebarang pemerhatian di
Jadual Tender .
3.0 Beri nombor bersiri kepada setiap tawaran yangditerima. Catatkan di kulit muka hadapan dokumen,nombor siri pentender serta turunkan tandatangandan tarikh pembukaan.
Catatkan sebarang pemerhatian di
Jadual Tender .
3.1 Setiap dokumen terasing yang dikemukakan olehseseorang pentender hendaklah seboleh-bolehnyadikepilkan menjadi satu atau paling kurang yangmungkin. Catatkan nombor siri pentender bagisetiap dokumen yang terasing dan turunkantandatangan ringkas (initial).
3.2 Pastikan juga pentender tidak membuka penjilidanasal dokumen tender. Sebarang dokumen/maklumattambahan hendaklah dikemukakan berasingan daridokumen tender asal.
4.0 Semak Borang Tender: Catatkan sebarangpemerhatian diJadual Tender.
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
BIL. KETERANGAN JKPT* ULASAN
4.2 Pastikan syarikat yang mengemukakan tenderadalah sama dengan syarikat yang membeli
dokumen tender.
4.3 Pastikan pentender melengkapkan keseluruhanBorang Tender.
4.4 Pastikan harga tawaran di Borang Tender samadengan di `Grand Summary'.
4.5 Pastikan harga tawaran yang di catatkan di dalamangka sama dengan yang dicatatkan di dalamperkataan.
Pemerhatian:
(i) Sekiranya pentender tidak menandatangani Borang Tender, jangan catatkan harganya di ruangan harga kerana tendernya tidak akan dipertimbangkan. Walau bagimanapun, catatan boleh dibuat di akhir Jadual.
(ii) Sekiranya terdapat perbezaan harga tawarandi dalam bentuk angka dan perkataan, padaumumnya harga tender yang diambil adalah
yang di dalam perkataan, kecuali jika terdapatkesilapan yang ketara pada harga di dalamperkataan, yang mana harga dalam angkabolehlah diambil (setelah dibandingkan denganharga di `Grand Summary').
5.0 Semak samada terdapat surat-surat pengesahanbank di dalam sampul surat yang berlakridisertakan bersama. Jika ada, buka sampul-sampul surat berkenaan dan catatkan nombor siri pentender serta turunkan tandatangan.Stapelkan pada dokumen tender berkenaan.
Catatkan di Jadual tender yang pentender ada mengemukakan surat pengesahan bank di dalam
sampul surat berlakri dan telah di buka oleh Jawatankuasa.Nyatakan juga bilangan surat bank yang diterima.
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Chapter 7 – INVITATION AND RECEIPT OF TENDER
BIL. KETERANGAN JKPT* ULASAN
6.0 Turunkan tandatangan ringkas di:
(i) semua muka surat di Borang Tender
(ii) `Grand Summary' di Senarai Kuantiti dan
(iii) setiap kesilapan atau pertindihan tulisan diBorang Tender dan Senarai Kuantiti.
7.0 Buka Anggaran Jabatan dan turunkan tandatanganserta catatkan tarikh.
8.0 Semua semakan dan tindakan di atas hendaklah
saling disemak oleh Ahli Jawatankuasa untuk mempastikan tiada kesilapan berlaku.
9.0 Peraturan Tambahan Untuk TenderBekalan/Perkhidmatan dan `Design and Build'
Catatkan semua pemerhatian di atas di Jadual Tender.
9.1 Pastikan dokumen tawaran harga dan tawaranteknikal dikemukakan dalam dua (2)sampul surat yang berasingan.
9.2 Pastikan nama pentender tidak tercatat di dalamdokumen penentuan teknikal.Sekiranya terdapat nama/tanda syarikat dalamdokumen teknikal, pastikan identititersebut dipadamkan.
9.3 Catatkan nombor siri pentender di dokumentawaran harga dan tawaran teknikal.
Tandatangan Jawatankuasa Membuka Tender Tandatangan Jawatankuasa Membuka Tender
*Jawatankuasa Pembuka Tender
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART II : PRE-CONTRACT
CHAPTER 8
TENDER EVALUATION AND
ACCEPTANCE
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
Table of Contents
Table of Contents .......................................................................................................................8-i
List of Flowcharts ......................................................................................................................8-ii
8.1 INTRODUCTION ............................................................................................................. 8-2
8.2 PROCEDURES................................................................................................................. 8-2
8.3 REFERENCE DOCUMENTS ............................................................................................... 8-5
8.4 REFERENCES.................................................................................................................. 8-5
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
List of Flowcharts
Flowchart Description Page
Flowchart 8.1 Tender Evaluation and Acceptance 8-1
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
Flowchart Description Action By Reference
1. Selection and appointmentof Evaluation Officer(s) PH
2. Tender Evaluation EvaluationOfficer(s)
3. Tender Clarification, if required
EvaluationOfficer(s)
SPP 5/2007
4. Prepare Tender EvaluationReport (Kertas TaklimatTender)
PO /Evaluationofficer(s)
5. Endorsement by TenderEvaluation Committee
6. Presentation of TenderEvaluation Report / TenderRecommendation toProcurement Board /
MoF
TS
7. Unconditional approval? ProcurementBoard / MoF
8. Issue Letter of Intent PO
9. Comply with conditions PH/PO
10. I ssue Letter of Acceptance PO
Flowchart 8.1 – Tender Evaluation and Acceptance
1
3
6
10
2
4
8
9
7No
Yes
5
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
8 TENDER EVALUATION AND ACCEPTANCE
8.1 INTRODUCTION
This chapter provides:
The guidelines on the evaluation and acceptance of tender.
8.2 PROCEDURES
Please refer to Flowchart 8.1 – Tender Evaluation and Acceptance.
Item Procedures / Tasks Action By
/ Reference
1 Selection And Appointment of Evaluation Officer(s)
The Project Head shall assign the Evaluation Officer(s).
The Evaluation Officer(s) cannot be a member of the TenderOpening Committee.
Action by: PH
2 Tender Evaluation
Refer to the latest Treasury / DID guidelines on TenderEvaluation process.
Tender evaluation report should be completed within 30 days
from the receipt of the tender documents.
All information pertaining to tender evaluation to be treated asconfidential.
Action by: EvaluationOfficer
3 Tender Clarification
If tender clarification (of the tender(s) received) is required bythe Evaluation Officer:
Prior written permission of the chairman of the TenderProcurement Board must be obtained.
The clarification process is conducted by the TenderSecretariat
No communication is allowed between any EvaluationOfficer and any tenderer unless written permission isgiven by the chairman of the Tender ProcurementBoard.
Action by: TenderSecretariat
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
Item Procedures / Tasks Action By
/ Reference
4 & 4A Tender Evaluation Report
The Evaluation Officer(s) shall prepare the Tender Evaluation
Report (Kertas Taklimat Tender) in the approved format.
The Tender Evaluation Report shall be submitted to the TenderEvaluation Committee for review and endorsement.
Design and Build
For Design and Build contracts, the tender evaluation shall bedivided into 2 stages; technical evaluation and financialevaluation.
Action by:Evaluation Officer(s)
The Tender Evaluation Committee
is appointed by the DG, in accordance
with the Treasury
Instruction (AP 191 & 192).
5 Tender Recommendation
Tender Evaluation Committee shall make necessaryrecommendations to the Director General, through BUBK, forthe DG’s approval prior to submission to the TenderProcurement Board at Ministry.
BUBK shall submit the approved report to the TenderSecretariat at Ministry for tabling at the Tender ProcurementBoard.
The Tender Secretariat shall be responsible for convening theTender Procurement Board.
The Evaluation Officer shall present the Tender EvaluationReport to the Tender Procurement Board for decision.
The composition of the Tender Procurement Board shall be inaccordance with the value of the tender/contract and the limitof authority (see Chapter 5 - Authority).
Action by: TenderEvaluation Committee
Action by:BUBK
Action by:Tender Secretariat /Tender Procurement
Board
6 Approval
The Tender Procurement Board may approve the tender, withor without condition.
7 Letter of Intent
Where the approval of the Tender Procurement Board isconditional, then a Letter of Intent must be issued pendingnegotiation with the approved tenderer.
The Letter of Intent shall be in the approved format.
Complete and check that the information on the Letter of Intent is correct.
The Letter of Intent ought to be signed by an authorizedofficer.
Action by: PO
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
Item Procedures / Tasks Action By
/ Reference
8 Negotiations
The Project Head shall conduct the negotiations with the
approved tenderer, with the assistance of the ProcurementOfficer.
Inform the Tender Procurement Board or Treasury (as the casemay be) of the results of the negotiations, and for finalapproval, if required.
Action by: PH / PO
9 Letter of Acceptance
Check that approval of the Tender Procurement Board is given.
Confirm that the funds / budget is available.
Prepare the Letter of Acceptance, using the currentform/format.
Complete and check that the information on the Letter of Acceptance, and Notification of Acceptance of Tender, arecorrect, i.e.
The name and address are correct Project title The accepted Contract Sum Amount for Performance Bond
Amount for Advance Payment Amount of coverage for insurances Period of insurance coverage Date of Possession of Site Completion Period and Date for Completion Defects Liability Period Name of SO/PD Name of officer-in-charge / contact person
The Letter of Acceptance must be signed by an authorizedofficer (see Chapter 5 - Authority).
Send the Notification of Acceptance of Tender, and Letter of Acceptance by registered post to Contractor, and copies to therelevant parties.
Action by: PO
See also chapter 5
Appendix–
Distribution List
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
8.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
Format Laporan Pernilaian Tender Kerja
Contoh Kertas Talimat Tender Kerja
Contoh Kertas Keputusan Tender Kerja
Contoh Surat Niat / Letter of Intent
Letter of Notification of Tender (Pemberitahuan Penerimaan Tender)
Letter of Acceptance – JKR 203D
Contoh Surat Pengesahan Budget
Garispanduan - Tugas Jawatan Kuasa Pernilaian
Garispanduan Pernilaian Tender Kerja
8.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the calling and receipt of tenders.
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 5 Tahun 2007: Tatacara Penguruasan Perolehan Kerajaan Secara Tender
[2] S/K.KEW/PK/PP/1100/00000010/31 Jld.23 SK.7(20), dated 21 March 2008: Garis PanduanPenilaian Tender
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPS.UB 3/1994: Peraturan Penilaian Tender Kerja
[2] SP JPS.UB 2/1995: Penyediaan Laporan Penilaian Tender
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Chapter 8 – ENDER EVALUATION AND ACCEPTANCE
(This page is deliberately left blank)
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 9
CONTRACT DOCUMENTATION
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Chapter 9 – CONTRACT DOCUMENTATION
Table of Contents
Table of Contents .......................................................................................................................9-i
List of Flowcharts ......................................................................................................................9-ii
9.1 INTRODUCTION ............................................................................................................. 9-2
9.2 PROCEDURES................................................................................................................. 9-2
9.3 REFERENCE DOCUMENTS ............................................................................................... 9-8
9.4 REFERENCES.................................................................................................................. 9-8
APPENDIX 9A Checklist for Preparation of Contract Documents (Senarai Semakan PenyediaanDokumen Kontrak)………………………………..………………………………………………….. 9A-1
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Chapter 9 – CONTRACT DOCUMENTATION
List of Flowcharts
Flowchart Description Page
Flowchart 9.1 Contract Documentation 9-1
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Chapter 9 – CONTRACT DOCUMENTATION
Flowchart Description Action By Reference
1. Letter of Acceptance isissued
-
2. Compile the ContractDocuments.
CAO
Refer: Contract
Document-
ation Checklist
3. Check that each documentis complete, correct andcompliant.
CAO
4. Quality Audit CAO/BUBK*
5. Correctly mark the ‘Original’ and ‘Duplicate’ documents
CAO
6. Signing of ContractDocument
CAO
7. Stamping of documents CAO
8. Distribute the ContractDocuments
CAO
*Where the Contract is signed at the DID Headquarters or Ministry, the documents shall be auditedby BUBK
Flowchart 9.1 – Contract Documentation
1
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Chapter 9 – CONTRACT DOCUMENTATION
9 CONTRACT DOCUMENTATION
9.1 INTRODUCTION
This chapter provides:
The guidelines on the compilation and preparation of the Contract Documents for signing anddistribution to the relevant parties.
9.2 PROCEDURES
Please refer to Flowchart 9.1 – Contract Documentation.
Step Procedures / Tasks Action By
/ Reference
1 Letter of Acceptance is issued
Upon issuance of the Letter of Acceptance, the contractor mustsubmit the required documents and information stated in theLetter of Acceptance for verification by CAO.
Letter of Delegation of Power
Upon the issuance of the Letter of Acceptance, issue thenecessary letters of delegation of power.
Ensure that the following documents, as may be required bythe Letter of Acceptance of Tender, are submitted by theContractor:
Performance Bond (where ‘Performance GuaranteeSum’ is not used)
Insurance policies together with original receipts Details of SOCSO Advance payment bond (if Advance Payment is applied
by the Contractor and permitted under the Contract).
For information
Action by : SO
Action by : CAO
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Chapter 9 – CONTRACT DOCUMENTATION
Step Procedures / Tasks Action By
/ Reference
Check that the information on the Performance Bond (where ‘Performance Guarantee Sum’ is not used) is in order:
Parties Contract number and references Validity period (dates) All other information are correctly inserted Issued by a bank or insurance company approved by
Bank Negara Verification from the bank is attached.*
*Write to issuing bank and request for verification.
Check that the information on the relevant insurance policiesare in order :
Parties Validity period (dates) Contract references and amounts insured Excess clauses, if any Relevant endorsements
Action by : CAO
2 Compile the Contract Documents
The Contract Documents are compiled and bound as soon as ispracticable after the issuance of the Letter of Acceptance, butno later than 4 months after the issuance of the Letter of
Acceptance.
Refer to the Contract Documentation Checklist (SenaraiSemakan Penyediaan Dokumen Kontrak)
Using the accepted Tenderer’s tender document, compile thedocuments for contract binding in the format and order set outin the Tender Table Document (refer Chapter 6).
Design and Build Contract Documents
For design and build contracts, Step 2 and Step 8 shall becarried out by the Contractor.
The design and build contract documents shall be compiledby the Contractor.
The certified true copy of the Performance Bond andInsurance Policies shall be inserted into the ContractDocuments.
Action by : CAO
Refer: Contract Documentation
Checklist
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Chapter 9 – CONTRACT DOCUMENTATION
Step Procedures / Tasks Action By
/ Reference
2a Contract Front Cover
Ensure that the
cover is in accordance with DID’s approved format;
title (of project, etc), Contract Number and names arein accordance with the Letter of Acceptance.
Action by : CAO
2b Contents
Generally,
the contents and order of the Contract Documents isbased on the Tender Table Document, and
the Contract Documents contains the acceptedTenderer’s tender documents.
Ensure that:
Variation of Price schedules are completed, and thequantities inserted.
Check for irregularities. Make correction if necessaryand as agreed by contractor.
All information are correctly entered in the Appendix tothe Conditions of Contract.
Ensure that all other pertinent information is correctly enteredor inserted in the contract forms and other documents.
Ensure that all superseded information are marked as such.
Action by : CAO
2c Numerical checks, Corrections and Rationalisation of Rates
Check for arithmetical errors. Arithmetical errors in the Billsof Quantities or the Summary of Tender must be corrected.
Check the rates and prices for reasonableness andconsistencies. Check the distribution of prices to prevent
“front loading”. Carry out “rationalisation” of the rates andprices as necessary.
Where rationalization of rates had been carried out, thesechanges must be agreed by the Contractor.
Action by : CAO
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Chapter 9 – CONTRACT DOCUMENTATION
Step Procedures / Tasks Action By
/ Reference
Both the Authorised Party and the Contractor must initialnext to all corrections, or changes due to rationalisation, of rates and prices.
The letters to and from the Contractor, amending orconfirming the original tender or affecting the Contract inany way, shall be included in the Contract Document(arranged in date order with the latest letter first, andinserted these after Letter of Acceptance)
Action by : CAO
2d Contract Documentation Checklist
The Checklist must be ticked (checked) and initialed by thecompiler, and together with the compiled documents shall beforwarded to the checker for checking and verification.
Action by : CAO
3 Check the compiled Contract Document
Refer to the Contract Documentation Checklist
Check every document and ensure they are complete, correctand compliant.
The checker initial against each checked item.
Action by : CAO
Refer: Contract Documentation
Checklist
4 Quality Audit
The Quality Auditor shall check that the documents are in
order and free from errors.
Where the Contract is signed at the DID Headquarters, thedocuments shall be audited by BUBK.
Action by : CAO /BUBK
5 Correctly mark the ‘Original’ and ‘Duplicate’ documents.
Identify the original Contract Document and correctly print orchop/stamp the words “Original” or “Duplicate” on the cover of the Contract Documents.
Copy documents must be certified as true copy by the Authorised Party (Kumpulan Pengurusan Profesional).
Action by : CAO
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Chapter 9 – CONTRACT DOCUMENTATION
Step Procedures / Tasks Action By
/ Reference
6 Signing of Contract Document
The Contract shall be signed by the officer duly authorised tosign the contract (‘Authorised Party’) , based on the value of the contract (refer Chapter 5 - Authority).
Arrange for the Original Contract Document to be signed bythe Authorised Party and the Contractor
The Contractor’s representative for signing of contract mustfurnish a certified copy of the company resolution (or otherdocumentary evidence) to prove that he is authorized to signthe Contract Document on behalf of the Contractor.
The following documents must be signed by both Parties:
Articles of Agreement Form of Tender Letter of Acceptance List Contract Drawings
Where corrections were made due to arithmetical errors, orrationalisation of rates had been carried out, the changes mustbe initialed by both the Authorised Party and the Contractor.
The following documents must also be signed by Contractor:
Schedules of Rates
Stamp all drawings as “Contract Drawings”.
Drawings
Drawings prepared in-house shall be signed by relevant officer.If drawings by Consultant, to be signed by RegisteredEngineer, Registered Architect and accepted by Director of Division/State [To be confirmed by BUBK]
Design and Build Contract - Drawings
All contract drawings must be signed and endorsed by aRegistered Engineer, Registered Architect etc, who preparedthe design.
Action by : CAO
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Chapter 9 – CONTRACT DOCUMENTATION
Step Procedures / Tasks Action By
/ Reference
7 Stamping of Contract Documents
Arrange for the stamping of the Contract Documents (originaland duplicate only).
The stamp must be affixed to the first page of the Articles of Agreement.
The costs for stamping shall be borne by the Contractor.
Exemption of Stamp Duty – Forms JKR 203/203A
In the alternative to stamping of Contract Documents, the CAOmay apply for exemption of stamp duty under Section 35 of the Stamp Act 1949 (Act 378).
The exemption endorsement must be affixed to the first pageof the Articles of Agreement (original and duplicate only).
Design and Build Contracts
The Contractor shall be responsible for both the costs of andarranging for the stamping of the Design and Build ContractDocument.
Action by :CAO
Refer JPS letter ref:
(60)dlm.PPS.10/4/2 BUB Jld. 4 bth.
2.10.2007
8 Distribute Contract Documents
Issue and distribute the Contract Document to the relevantparties. Distribute the copies in accordance with theDistribution List set out in Appendix 5A.
The original Contract Document for project of value more thanRM3 million shall be kept at BUBK. For other projects, theoriginal Contract Document is retained and kept by the Division
/ State which implements the project.
The Performance Bond shall be retained and keep safe at thedivision/state office which issued the Letter of Acceptance.
Unless there is any unresolved dispute between the
Government and the Contractor, the Contract Document mustbe retained for 7 years after the issuance of the FinalCertificate.
If the is any unresolved dispute between the Government andthe Contractor, then the Contract Documents (and alldocuments in connection with the project) must be retaineduntil the dispute is resolved, or otherwise as instructed by the
Attorney General Office.
Action by : CAO
Refer: Chapter 5,
Appendix 5A –
Distribution List
For information
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Chapter 9 – CONTRACT DOCUMENTATION
9.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
Sample Contract Document Cover
Sample Contents Page
Surat Perwakilan Kuasa (Kepada wakil P.P. Kerja Utama Untuk Penyeliaan dan ArahanKeseluruhan Kerja)
Pemberitahu Perwakilan Kuasa (bagi Wakil P.P. Kerja Utama)
Surat Perwakilan Kuasa (Kepada Wakil P.P. Pakar untuk Penyeliaan Kerja Tertentu)
Pemberitahu Perwakilan Kuasa (bagi Wakil P.P. Pakar)
9.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the contract documentation.
Treasury Circular(Surat Pekeliling Perbendaharaan)
Nil
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS.UB 1/1995: Perlantikan Pegawai Penguasa, Perwakilan Kuasa Pegawai Penguasa danPegawai-Pegawai Yang diberi Kuasa Dalam Urusan Pentadbiran Kontrak.
[2] SPJPS.UB 3/1995: Peraturan Penyediaan Dokumen Tender dan Kontrak
[3] (36)dlm. PPS.10/4/2 CUB Jld.3 (27/7/98): Pengedaran Dokumen-dokumen (Kontrak Kerja)Biayaan Persekutuan
[4] SP JPS Bil. 1/2003: Perlantikan Pegawai Penguasa (P.P), Perwakilan Kuasa Pegawai Penguasa(Wakil P.P) Dan Pegawai-Pegawai Yang Diberi Kuasa (PYDK) Dalam Urusan Pentadbiran Kontrak.(Tambahan kepada Surat pekeliling SPJPS.UB 1/1995)
[5] ( 60 )dlm. PPS 10/4/2 BUB Jld 4 2 Oktober 2007: Duti Setem Bagi Dokumen Kontrak
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 9
– Contract Documentation
APPENDIX 9A
Checklist forPreparation of
Contract Documents
(Senarai Semakan PenyediaanDokumen Kontrak)
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Chapter 9 – CONTRACT DOCUMENTATION
APPENDIX 9A CHECKLIST FOR PREPARATION OF CONTRACT DOCUMENTS(SENARAI SEMAKAN PENYEDIAAN DOKUMEN KONTRAK)
TAJUK
PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1.0 PENGENALAN
Secara amnya setiap Dokumen Kontrak mestilah lengkap dan teratur sertamengandungi semua Dokumensebagaimana yang terkandung di dalamDokumen Meja Tender. Secara khususDokumen Kontrak mestilahmengandungi Dokumen TenderPentender yang disetujuterima olehLembaga Perolehan.
Dokumen Kontrak hendaklah disediakandengan kadar segera selepas SuratSetujuterima Tender yang Asalditandatangani oleh Kontraktor dansaksi beliau. Insuran-insuran besertaresit-resit resmi pembayaran Premiuminsuran-insuran tersebut. No.KodPERKESO, GerentiBank/Insuran/Syarikat Kewangan untuk Bon perlaksanaan, GerentiBank/Insuran/Syarikat Kewangan untuk Bayaran Pendahuluan (Jika Kontraktormemohon untuk mendapatkan WangPendahuluan) yang Asal dikembalikan.
Tandakan
() selepassemakan
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Chapter 9 – CONTRACT DOCUMENTATION
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
2.0 MUKA HADAPAN (KULIT)
2.1 Warna hendaklah warna kuning cair
2.2 Isikan maklumat-maklumat berikutpada muka hadapan Dokumen Kontrak
ASAL atau SALINAN, Cop Perkataan ASAL pada muka hadapan Dokumenyang asal dan Cop perkataan SALINANpada tiap-tiap muka hadapan salinan-salinan Dokumen Kontrak. Salinanmestilah diakui sah dan ditandatanganioleh pegawai dari Kumpulan
Pengurusan dan Profesional.
(a) Logo Kerajaan Malaysia.
(b) Nama Kerajaan Malaysia.
(c) Nama Jabatan Pengairan dan SaliranMalaysia.
(d) Perkataan Dokumen Kontrak.
(e) Tajuk projek mestilah sama sepertidengan tajuk kerja yang terkandung didalam Surat Setujuterima Tender.
(f) Nombor Kontrak.
(g) Jilid dan Seksyen Dokumen Kontrak.
(h) Logo JPS
- Di sebelah bawah ‘Logo JPS’ catitkan Bulan dan Tahun DokumenKontrak disediakan.
- Di sebelah kanan bertentangandengan ‘Logo JPS’ catitkan :-
KETUA PENGARAHJABATAN PENGAIRAN DANSALIRAN MALAYSIA JALAN SULTAN SALAHUDDIN,50626 KUALA LUMPUR
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Chapter 9 – CONTRACT DOCUMENTATION
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
3.0 ISI KANDUNGAN DOKUMEN KONTRAK
3.1 ARAHAN KEPADA PENTENDER.
Sebagaimana terkandung di dalamDokumen Meja Tender.
3.2 BORANG TENDER :
3.2.1 Pastikan Borang Tender Asaldigunakan.
3.2.2 Maklumat-maklumat yang perlu
disemak dan yang perlu diisi.
Muka Surat 1
(a) Isikan Nombor Kontrak.
(b) Isikan tarikh Kontrak ditandatanganioleh Pegawai yang diberi kuasamenandatangani kontrak.
(c) Pastikan Cop Syarikat, TandatanganKontraktor dan Saksi, beserta nama danalamat dicop dan diisi oleh Kontraktorpada ruang yang disediakan.
(d) Pastikan Cop Pegawai yang diberi kuasamenandatangani Kontrak dan saksibeserta nama dan alamat dicop dandiisi pada ruang yang disediakan.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.3 SURAT SETUJUTERIMA TENDER –Borang JKR 203D
3.3.1 Pastikan Borang Surat Setujuterima Asal digunakan.
3.3.2 Maklumat-maklumat yang perlu diisi.
Muka Surat 1.
(a) Isikan Nombor Kontrak.
(b) Isikan tarikh Kontrak ditandatanganioleh Pegawaiyang diberikuasa menandatanganikontrak.
(c) Pastikan Cop Syarikat, TandatanganKontraktor dan Saksi, beserta nama danalamat dicop dan diisi oleh Kontraktorpada ruang yang disediakan.
(d) Pastikan Cop Pegawai yang diberi kuasamenandatangani Kontrak dan saksibeserta nama dan alamat dicop dandiisi pada ruang yang disediakan.
3.4 SYARAT-SYARAT KONTRAK :
Maklumat-maklumat yang perlu diisi
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK : (Samb.)
Muka Surat 1
(a) Nombor Kontrak, Kepala dan PecahanKepala peruntukan.
(b) Nama Kerajaan Malaysia.
(c) Nama Kontraktor dan alamat, samaseperti yang terkandung di dalam SuratSetujuterima Tender.
(d) Nama projek, sama seperti yangterkandung di dalam Surat SetujuterimaTender.
(e) Senarai Lukisan, sama seperti yangterkandung di dalam Dokumen MejaTender.
Muka Surat 2.
(a) Para 2(d)
Tambahkan perkataan Addenda No. 1selepas Syarat-syarat Kontrak samaseperti yang terkandung di dalamDokumen Meja Tender.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK : (Samb.)
Muka Surat 2. (Samb.)
(b) Para 2(e)
Peruntukan Khas Syarat-syarat Kontrak
(i) Perubahan Harga Bahan-BahanBinaan.
(ii) Bayaran Pendahuluan(iii) Restriction and Procedure on use
of Imported Goods.(iv) Bon Perlaksanaan dalam bentuk
Wang Jaminan Perlaksanaan.
(c) Para 4
Harga Kontrak diisi dalam perkataandan nilai mestilah sama seperti yangterkandung di dalam Surat SetujuterimaTender.
Muka Surat 3.
(a) Pastikan Cop Syarikat, TandatanganKontraktor dan Saksi, beserta nama danalamat dicop dan diisi oleh Kontraktorpada ruang yang disediakan danpastikan pegawai yang tandatanganbagi pihak kontraktor hendaklah yangdiberi kuasa menandatangani Kontrak.
(b) Pastikan Cop Pegawai yang diberi kuasamenandatangani Kontrak dan saksi
beserta nama dan alamat dicop dandiisi pada ruang yang disediakan.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK : (Samb.)
Muka Surat 4.
(a) Fasal 1(a)( i )
Sama seperti di para 2(d), 2(e) dan2(h) di Muka Surat 2 Syarat-syaratKontrak.
(b) Fasal 1(a)(iv)
Nama Jawatan Pegawai Penguasa yangdiberi kuasa mengikut had kewanganyang ditetapkan di bawah SP JPS Bil.1/2003 – Perlantikan Pegawai Penguasa(P.P.), Perwakilan Kuasa PegawaiPenguasa (Wakil P.P.) Dan Pegawai-Pegawai Yang Diberi Kuasa (PYDK)Dalam Urusan Pentadbiran Kontrak.
LAMPIRAN KEPADA SYARAT-SYARATKONTRAK.
Muka Surat 30.
(a) Fasal 3(a)(i)
Nama Pegawai yang diberi kuasa untuk bertindak bagi pihak kerajaan mengenaiFasal 40, Fasal 43, Fasal 51, fasal 52dan Fasal 54 sama seperti yang telahditentukan mengikut had kewanganyang ditetapkan di bawah SP JPS1/2003.
(b) Fasal 3(a)(ii)
Nama pegawai yang berkuasa untuk meluluskan perubahan mengikut had-had seperti yang telah ditentukan didalam Dokumen Meja Tender. Untuk mendapatkan maklumat yang lebih
jelas lagi sila Rujuk kepada S.PPerbendaharaan Bil. 7/2007, ‘Peraturan
Arahan Perubahan Kerja
(Variation Order)
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK : (Samb.)
Muka Surat 31.
Fasal 11(d)
Isikan tarikh tender ditutup.
(b) Fasal 33
(i) Jumlah minimum Liabiliti Awam iabergantung kepada jumlah harga
Kontrak dan diisi dalam bentuk nilai seperti yang telah ditentukandi dalam Dokumen Meja Tender.
(ii) No. Polisi dan nama SyarikatInsuran.
(iii) Tempoh Insuran termasuk tempohkontrak dicampur tempohtanggungan kecacatan dicampur 3Bulan 14 Hari.
(c) Fasal 33(a)
Amaun Fasal lebihan hendaklah diisi jika ada.
(d) Fasal 35
Isikan No. Pendaftaran Skim PERKESO.
(e) Fasal 36
(i) Jumlah harga kontrak, isikandengan perkataan ‘tiada’ jikaProjek baru.
(ii) No. Polisi dan Nama SyarikatInsuran.
(iii) Tempoh Insuran, isikan tempohkontrak sahaja.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK (Samb.)
Maklumat-maklumat yang perlu diisi(Samb.)
LAMPIRAN KEPADA SYARAT-SYARATKONTRAK (Samb.)
Muka Surat 31. (Samb.)
(f) Fasal 36(b)
Amaun Fasal lebihan hendaklah diisi jika ada.
(g) Fasal 37
(i) Jumlah amaun untuk BonPerlaksanaan iaitu 5% dari hargakontrak seperti yang telahditentukan di dalam Dokumen Mejatender dan diisi dalam bentuk nilai.
(ii) No. GerentiBank/Insuran/SyarikatKewangan, jika Kontraktor memilih Bon Perlaksanaandalam bentuk gerentiBank/Insuran/SyarikatKewangan.
(h) Fasal 38(b)
Isikan tarikh milik tapak.
(i) Fasal 39
Isikan tarikh siap bagi kesemua kerja.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK (Samb.)
Maklumat-maklumat yang perlu diisi(Samb.)
LAMPIRAN KEPADA SYARAT-SYARATKONTRAK (Samb.)
Muka Surat 31. (Samb.)
(j) Fasal 40
Isikan Ganti rugi tertentu dan ganti rugiditetapkan berasaskan Dokumen MejaTender, dalam bentuk nilai RM,memundarkan kepada puluh yangterdekat.
Muka Surat Terakhir
(a) Fasal 41
Isikan maklumat-maklumat berikut didalam jadual jika terdapat penyiapanbangunan yang hendak diserahkankepada pemilik mengikut bahagian-bahagian seperti yang telah ditentukandi dalam Dokumen Meja Tender.
(i) Nama seksyen atau bahagian.
(ii) Tarikh Milik (Fasal 38(c))
(iii) Tarikh Siap
(iv) Ganti rugi tertentu dan ganti rugiditetapkan.
(b) Fasal 45
Isikan tempoh tangungan kecacatansama seperti terkandung di dalamDokumen Meja Tender.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.4 SYARAT-SYARAT KONTRAK (Samb.)
Maklumat-maklumat yang perlu diisi(Samb.)
LAMPIRAN KEPADA SYARAT-SYARATKONTRAK (Samb.)
Muka Surat Terakhir (Samb.)
(c) Fasal 47(a)
(i) Nilai kerja yang perludilaksanakan termasuk bahan-
bahan dan barang-barang yangperlu diserah- hantar sebelumperakuan Interim Pertamadikeluarkan iaitu tidak kurangdari 5% Harga Kontrak Asal atauRM100,000, yang mana lebihkurang (Rujuk dokumen tender).
(d) Fasal 47(a)
(ii) Nilai kerja yang perlu
dilaksanakan termasuk bahan-bahan dan barang-barang yangperlu diserah-hantar sebelumtiap-tiap Perakuan Interimkemudiannya dikeluarkan iaitutidak kurang dari RM1,000.00.
(follow checklist payment)
(c) Fasal 47(d)
Tempoh menunaikan perakuan bayaraninterim isikan 30 Hari (Rujuk dokumen
tender).
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.5 ADDENDA KEPADA SYARAT-SYARAT
KONTRAK
(i) Masukkan Addenda No. 1
Pada Borang Pengesahan Addenda.Maklumat-maklumat yang perlu diisi:-
(a) Nombor-nombor dan jumlah mukasurat Adenda-addenda tersebut.
(b) Pastikan Cop Syarikat, TandatanganKontraktor dan Saksi, beserta nama danalamat dicop dan diisi oleh Kontraktorpada ruang yang disediakan pada mukahadapan Addenda tersebut.
(c) Pastikan Cop Pegawai yang diberi kuasamenandatangani Kontrak dan saksibeserta nama dan alamat dicop dandiisi pada ruang yang disediakan padamuka hadapan Addenda tersebut.
3.6 PERUNTKAN KHAS KEPADA SYARAT-SYARAT KONTRAK
(i) Syarat-syarat Kontrak – PerubahanHarga ke atas Bahan-bahanBinaan.
(ii) Sertakan Senarai Bangunan,Kategori yang berkaitan, FaktorPulangan dan Index Asas untuk tujuan Pelarasan Perubahan Harga
menurut Peruntukan Khas Syarat-syarat Kontrak.
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.6 PERUNTKAN KHAS KEPADA SYARAT-
SYARAT KONTRAK (Samb.)
Isikan Index Asas mengikut Jenis danKategori- Kategori Bangunan untuk kawasan yang telah ditetapkan.
Index Asas diambil berdasarkan BulanTender ditutup, Index Kos Bangunandiperolehi dari Jabatan PerangkaanMalaysia yang dikeluarkan dari bulan kebulan.
(iii) Syarat-syarat Kontrak – BayaranWang Pendahuluan.
(iv) ‘Restriction procedure on use of imported goods and List of government multimodal transportoperator’
(v) Bon Perlaksanaan dalam bentuk Wang Jaminan Perlaksanaan.
3.7 SPESIFIKASI PIAWAI
(a) Masukkan Spesifikasi Piawai Kerja-kerja Bangunan sama seperti yangterkandung di dalam Dokumen MejaTender.
(b) Masukkan Spesifikasi Piawai Kerja-kerjaMekanikal dan Elektrikal sekiranyaprojek dipanggil secara Pakej samaseperti yang terkandung di dalamDokumen Meja Tender.
(c) Masukan Spesifikasi bagi KawalanKualiti Alam Persekitaran dan KawalanHakisan dan Mendapan.
3.8 SPESIFIKASI ADDENDA
(a) Masukkan Spesifikasi Addenda samaseperti yang terkandung di dalamDokumen Meja Tender.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.8 SPESIFIKASI ADDENDA (Samb.)
Pada Borang Pengesahan Spesifikasi Addenda
Maklumat-maklumat yang perlu diisi:-
(i) Nama projek, sama seperti yangterkandung di dalam SuratSetujuterima Tender.
(ii) Nombor Kontrak.
(iii) Tarikh Kontrak iaitu Tarikh semasaKontrak ditandatangani olehPegawai yang diberikuasamenandatangani Kontrak.
(iv) Jumlah Mukasurat Spesifikasi Addenda.
(v) Pastikan Cop Syarikat,Tandatangan Kontraktor dan Saksi,beserta nama dan alamat dicopdan diisi oleh Kontraktor padaruang yang disediakan.
(iv) Pastikan Cop Pegawai yang diberikuasa menandatangani Kontrak dan saksi beserta nama dan alamatdicop dan diisi pada ruang yangdisediakan.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.9 PENGUKURAN DAN FAKTOR
MENGHARGAKAN SENARAI KUANTITI(PREAMBLE) – Bagi Kontrak BerasaskanSenarai Kuantiti
(a) Masukkan Pengukuran dan FaktorMenghargakan Senarai Kuantiti samaseperti yang terkandung didalam Dokumen Meja Tender.
3.10 SENARAI KUANTITI – Kontrak Berasaskan Senarai Kuantiti
(a) Ringkasan Tender.
(i) Setiap nilai Kerja-kerja yang diisiharga di dalam ringkasan Tenderoleh Kontraktor perlu diselaraskandan mestilah sama nilainya dengannilai terkumpul Kerja-kerja Awalan,nilai-nilai terkumpul Kerja-kerjayang Berkenaan, Kerja-KerjaCerucuk (jika ada), Wang KosPrima dan Wang Peruntukan
Sementara yang telahpun disemak,diselaras dan diseragam kadar-kadar harganya terlebih dahulu.
(ii) Jika perbezaan kesilapankeseluruhan perkiraan itu BesarJumlahnya, Pelarasan peratusanperlu dibuat iaitu denganmenjumlahkan nilai terkumpulkerja- kerja di ringkasan Tender,sekiranya jumlah yang disemak
melebihi dari Harga Tender,Pelarasan peratusannya adalahKurangan, sekiranya jumlah yangdisemak kurang dari Harga Tender,Pelarasan Peratusannya adalahTambahan, di mana pelarasandibuat dengan tidak menjejaskanHarga Tender.
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.10 SENARAI KUANTITI (Samb.)
(a) Ringkasan Tender (Samb.)
(iii) Jika perbezaan kesilapankeseluruhan perkiraan itu kecil
jumlahnya memadailah nilai Kerja-kerja tersebut diselaraskan dengandiagih-agihkan di mana perlu padaitem-item Kerja Awalan ataudiselaraskan dengan diagih-agihkan atau diseragamkan keitem-item Kerja-kerja Berkenaanlain dengan tidak menjejaskan
Harga Tender.
(iv) Jumlah terkumpul nilai kerjakeseluruhan yang diisi olehPentender untuk dibawa ke BorangTender mestilah sama jumlahharga Tender yang dipersetujuioleh Lembaga Perolehan.
(v) Setiap kesilapan pengiraanmestilah diperbetulkan terlebihdahulu dan hendaklah dipersetujuioleh Kontraktor. Kontraktormestilah menurunkan tandatanganringkas pada tempat-tempatpengiraan yang telah diperbetulkanbersama-sama dengan pegawaiyang diberi kuasa bagi pihak kerajaan.
(b) Kerja Awalan.
(i) Setiap item-item Kerja Awalanyang diisi harga oleh Kontraktor
pastikan ia adalah perlu. Semakharga-harga tersebut untukmemastikan kemunasabahanharganya. Sekiranya terdapatkadar-kadar harga yang tidakmunasabah ia hendaklahdiselaraskan denganmengagihkannya pada Item-itemlain pada kerja-kerja Awalan ataudiselaraskan denganengagihkannya ke bahagiankerja-kerja lain.
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Chapter 9 – CONTRACT DOCUMENTATION
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.10 SENARAI KUANTITI (Samb.)
(b) Kerja Awalan (Samb.)
(ii) Setelah Item-item kerja-Kerja Awalan diselaraskan ataudiperbetulkan hendaklahdipersetujui oleh Kontraktor.Kontraktor mestilah menurunkantandatangan ringkas pada tempat-tempat pengiraan yang telahdiperbetulkan bersama-samadengan pegawai yang diberi kuasabagi pihak kerajaan.
(iii) Jumlah terkumpul nilai keseluruhanKerja-Kerja Awalan yang telahdiselaraskan hendaklah dibawa keRingkasan Tender.
Lampiran Kepada Kerja-kerja Awalan
Kadar kerja harian dan Jumlah Kadar Harga Harian untuk Loji dan Buruh.Pastikan Kadar Harga Upah Lojisehari dan Kadar Harga Upah Buruhsehari diisidengan Kadar Harga yangmunasabah oleh Kontraktor. Jikaterdapat Kadar-kadar harga yangdidapati tidak munasabah ia mestilahdiselaraskan terlebih dahulu danKontraktor mestilah menurunkantandatangan ringkas pada kadar-kadar Harga yang diselaraskan.Kadar Harga tersebut kemudiannyamestilah ditandatangani olehPegawai Penguasa atau Wakil atauPMK sebagai tanda kadar-kadarHarga diterima.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.10 SENARAI KUANTITI (Samb.)
(c) Kerja-kerja yang Berkenaan, dan Kerja-kerja Cerucuk (jika ada)
(i) Kadar-kadar Harga setiap unitItem-item Kerja-kerja Berkenaandan Kerja-kerja Cerucuk (jika ada)dan jumlah yang diisi harga olehKontraktor perlu disemak untuk memastikan kemunasabahanharganya. Ia disemak berpandukanharga pasaran semasa. Sekiranyaterdapat kadar-kadar harga yangtidak munasabah, tidak seragam,kesilapan pengiraan, kadar-kadarharga tersebut perlu diselaraskandan diseragamkan pada itemitemkerja lain yang sama cara kerjanyatermasuk memperbetulkan jumlahpengiraannya.
(ii) Setelah Item-item Kerja-Kerjatersebut diselaraskan ataudiperbetulkan hendaklahdipersetujui oleh Kontraktor.Kontraktor mestilah menurunkantandatangan ringkas pada tempat-tempat pengiraan yang telahdiperbetulkan bersama-samadengan pegawai yang diberi kuasabagi pihak kerajaan.
(iii) Jumlah terkumpul nilai keseluruhanKerja-Kerja tersebut yang telahdiselaraskan hendaklah dibawa keRingkasan Tender.
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3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.10 SENARAI KUANTITI (Samb.)
(d) Wang Kos Prima dan Wang PeruntukanSementera.
(i) Setiap Item-item Wang Kos Primadan Wang Peruntukan Sementarayang diisi harga oleh Kontraktorperlu disemak. Sekiranya terdapatkesilapan ia perlu diselaraskan dandiperbetulkan.
(ii) Setelah Item-item Kerja-Kerjatersebut diselaraskan ataudiperbetulkan hendaklahdipersetujui oleh Kontraktor.Kontraktor mestilah menurunkantandatangan ringkas pada tempat-tempat pengiraan yang telahdiperbetulkan bersama-samadengan pegawai yang diberi kuasabagi pihak kerajaan.
(iii) Jumlah terkumpul nilai keseluruhan
Kerja- Kerja tersebut yang telahdiselaraskan hendaklah dibawa keRingkasan Tender.
3.11 SENARAI LUKISAN YANG DIGUNAKANUNTUK PENYEDIAAN SENARAIKUANTITI
(a) Masukkan Senarai Lukisan yangdigunakan untuk penyediaan SenaraiKuantiti sama seperti yang terkandung
di dalam Dokumen Meja Tender.
(b) Pada Lukisan-Lukisan Kontrak.
(i) Semak catitan pada Senarai-senarai Lukisan dan lukisan-lukisanyang akan dijilidkan dalamDokumen Kontrak adalah samakandungannya seperti di dalamDokumen Meja Tender.
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
3.0 ISI KANDUNGAN DOKUMEN KONTRAK (Samb.)
3.11 SENARAI LUKISAN YANG DIGUNAKAN
UNTUK PENYEDIAAN SENARAIKUANTITI (Samb.)
(ii) Pastikan Semua pindaan atauperubahan pada Lukisan-lukisanKontrak mestilah diselaraskan jugapada Dokumen Meja Tender.
(c) Pada Borang Pengesahan Lukisan
Maklumat-maklumat yang perlu diisi:-
(i) Nama projek, sama seperti yangterkandung di dalam SuratSetujuterima Tender.
(ii) Nombor Kontrak.
(iii) Tarikh Kontrak iaitu Tarikh semasaKontrak ditandatangani olehPegawai Yang Diberi KuasaMenandatangani Kontrak.
(iv) Jumlah Mukasurat Lukisan-lukisan.
(v) Pastikan Cop Syarikat,Tandatangan Kontraktor dan Saksi,beserta nama dan alamat dicopdan diisi oleh Kontraktor padaruang yang disediakan.
(vi) Pastikan Cop Pegawai yang diberikuasa menandatangani Kontrak dan saksi beserta nama dan alamat
dicop dan diisi pada ruang yangdisediakan.
3.12 TARIKH KONTRAK
Pastikan tarikh Kontrak (iaitu Tarikhsemasa Kontrak ditandatangani) telahdiisi.
Borang tender Perkara-perkara Perjanjian
(Articles of agreement) Surat Setujuterima Tender Senarai lukisan kontrak
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
4.0 PENGEDARAN DOKUMEN-DOKUMENKONTRAK
(i) KSU, Kementerian Sumber Aslidan Alam Sekitar- Satu salinan tanpa Lukisan
(ii) Ketua Audit Negara- Satu salinan tanpa Lukisan.
(iii) Bank atau Syarikat yangmengeluarkan Bon Perlaksanaan.- Satu salinan tanpa Lukisan
(iv) Kontraktor- Satu salinan dengan Lukisan
- Berdaftar (AR)
(v) Pengarah Bahagian, Ibu PejabatJPS.
- Satu salinan dengan Lukisan
(vi) Pegarah Bahagian Kontrak danUkur Bahan, Ibu Pejabat JPS
- Kontrak Asal dengan Lukisan.
(vii) Pengarah Bahagian KhidmatPengurusan – Jika bayaran dibuatdi Ibu Pejabat Sahaja.- Satu salinan tanpa Lukisan
(viii) Akauntan Kanan Perbendaharaan(Negeri) – Jika bayaran dibuat diNegeri Sahaja.- Satu salinan tanpa Lukisan
(ix) Pengarah Negeri / Jurutera Projek
- Satu salinan dengan Lukisan.
(x) Juruperunding- Satu salinan dengan Lukisan
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Chapter 9 – CONTRACT DOCUMENTATION
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
5.0 PENYIMPANAN DOKUMEN KONTRAK ASAL DAN BON PERLAKSANAAN
(i) Dokumen Kontrak Asal hendaklahdisimpan dengan selamat diPejabat di mana Dokumen Kontrak disediakan dan disimpan di tempatyang mudah untuk mendapatkannya apabila ianyadikehendaki.
(ii) Bon Perlaksanaan hendaklahdisimpan dengan selamat dalamPeti Keselamatan atau kabinet kalis
api dan ianya mudah didapatkanapabila dikehendaki.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
*Audit Kualiti; Jika Berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 10
PAYMENTS
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Chapter 10 – PAYMENTS
Table of Contents
Table of Contents .....................................................................................................................10-i
List of Flowcharts .................................................................................................................... 10-ii
10.1 INTRODUCTION.........................................................................................................10-3
10.2 PROCEDURES ............................................................................................................10-3
10.2.1 Advance Payment ..........................................................................................10-3
10.2.2 Interim Payment ............................................................................................10-6
10.3 PAYMENT TERMS .....................................................................................................10-10
10.4 METHOD OF VALUATION..........................................................................................10-10
10.5 REFERENCE DOCUMENTS.........................................................................................10-10
10.6 REFERENCES ...........................................................................................................10-11
APPENDIX 10A Checklist for Preparation of Advance Payment (Senarai Semakan PenyediaanBayaran Pendahuluan)…………………………..…………………………………………….….. 10A-1
APPENDIX 10B Task List for Interim Payment (Borang Tindakan Kerja BayaranInterim)…………………………..…………………………………………………………………….. 10A-3
APPENDIX 10C Checklist for Preparation of Interim Payment (Senarai Semakan PenyediaanBayaran Interim)……………….………………………………………………………………....... 10A-5
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Chapter 10 – PAYMENTS
List of Flowcharts
Flowchart Description Page
Flowchart 10.1 Advance Payment 10-1
Flowchart 10.2 Interim Payment 10-2
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Chapter 10 – PAYMENTS
Flowchart Description Action By Reference
1. Application for Advance
Payment by Contractor
-
2. Check documents forcompleteness
CAO
3. Prepare SupportingDocuments for AdvancePayment. Checklist for Advance
Payment
CAO
See Appendix 10A
4. Documents are in properorder?
CAO
5. Issue Payment Certificate- Form JKR 66
SO
6. Quality Audit QS/CAO/BUBK*
7. Record payment detailsand issue to FD.
8. Record payment in votebook. Prepare paymentvoucher, and sign / issuepayment voucher to AG
Division / State
FD
9. Submit to AG FD
*Quality Audit: Where payment warrant is through the DID HQ – audit by BUBK; Where payment warrant ischanneled through the State – audit by Quantity Surveyor or Contracts Officer at State.
Flowchart 10.1 – Advance Payment
7
4
3
2
1
No
5
8
Yes
6
No
Yes
9
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1
2
5
8
9
3
4
No
6
7
Yes
Flowchart Description Action By Reference
1. 1st Valuation, or Interim Valuation
-
2. Site valuation PT / PM
3. Check documents forcompleteness, andcomputation
CAO
4. Prepare supporting
documents for payment Checklist for Interim
Payment
CAO
See Appendix 10C
5. Document is in properorder?
CAO
6. Issue Payment Certificate- Form JKR 66
SO
7. Quality Audit QS/CAO/BUBK*
8. Record payment detailsand issue documents toFD
9. Record payment in vote
book. Prepare paymentvoucher, sign and issuepayment voucher to AG
Division / State
FD
*Quality Audit: Where payment warrant is through the DID HQ – audit by BUBK; Where payment warrant ischanneled through the State – audit by Quantity Surveyor or Contracts Officer at State.
Flowchart 10.2 – Interim Payment
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Chapter 10 – PAYMENTS
10 PAYMENT
10.1 INTRODUCTION
This chapter provides:
The guidelines on the preparation and checking of the payment documents, and issuance of thepayment certificate for advance payment and interim payment.
10.2 PROCEDURES
10.2.1 Advance Payment
Please refer to Flowchart 10.1 – Advance Payment.
Step Procedures / Tasks Action By
/ Reference Generally
The advance payment shall not exceed 25% of the value of builder’s work (the Contract Sum less Prime Cost andProvisional Sums), subject to a maximum of RM 10 million.
SPP 5/2007
1 Contractor Submits Application for Advance Payment
(a) The Contractor must submit the application for advancepayment in accordance with the Contract, within 3 monthsof the possession of site.
(b) The application must be accompanied by the followingdocuments:
Letter of Acceptance duly signed and witnessed Performance Bond, or Letter of Confirmation on using
Performance Guarantee Sum Bank/insurance guarantee for advance payment. Insurance Policies and receipt issued by insurance
company Proof of registration with Socso Contractor’s Letter stating bank details, and signed by
authorized person.
For Information
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Chapter 10 – PAYMENTS
Step Procedures / Tasks Action By
/ Reference
2 Check documents for completeness
Upon receipt of the Contractor’s documents,
Check that the Contractor’s application is accompanied bythe necessary documents mentioned in Step 1
Check that each document is complete and/or in order.
Obtain confirmation from the bank or insurance companyagainst the bank or insurance guarantee.
Action By:CAO
3 & 4 Prepare the Supporting Documents for payment
Refer to Checklist for Preparation of Advance Payment (Senarai
Semakan Penyedian Bayaran Pendahuluan)
Complete and initials the Checklist for Preparation of Advance Payment.
Complete the Form JKR66.
Make six (6) copies of the completed JKR66 Form beforesigning.
The recommending officer signs the Form JKR66.
Submit Form JKR66, together with attached documents, to theSO for signature
Attach the following additional documents to the application
Approval of Tender Board / Treasury (if necessary)
Form JKR66, duly filled in with the correct information
Ensure the relevant documents are certified by a DID officer.
Fill in and initials the Tasklist (Borang Tindakan) and the
Checklist for Preparation of Advance Payment,, and attachthese to the documents.
Action By:CAO
Refer Appendix 10A
5 Issuance of Certificate of Advance Payment
If the advance payment document is duly completed, and thedocuments checked and endorsed by the relevant officers, theSO shall sign payment certificate.
Forward documents to State or HQ for Quality Audit orpayment processing, depending on the value of the Contract.
Action By:SO
Action By:CAO
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Chapter 10 – PAYMENTS
Step Procedures / Tasks Action By
/ Reference
6 Quality Audit
Quality Auditor shall check the documents are in order and arefree of errors.
Action By:BUBK
7 Recording of Payment Details
Record payment in the relevant State / HQ section, as relevant.
Make duplicates of payment documents (except paymentvoucher).
Action By:Relevant State /
Division
8 & 9 Recording Payment Details & Prepare payment voucher
Ensure that the correct amount is entered into the vote book.
Check that the documents are in order, and ensure that thepayment voucher is signed
Submit to the relevant to Accountant General for issuance of payment:
Form JKR66, payment voucher and supporting documents, together with duplicates.
Action By:Finance Division
Note: Recoupment of Advance Payment
The recoupment for advance payment only is made throughinterim payments, and in accordance with the recoupmentformula set out in the Special Provision to the Conditions of Contract.
For Information
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Chapter 10 – PAYMENTS
10.2.2 Interim Payment
Please refer to Flowchart 10.2 – Interim Payment.
Step Procedures / Tasks
Action By
/ Reference
1 Generally
For contracts using Standard Form of Contract JKR 203 and203A, interim valuations must be carried out at least once amonth.
For contract using Form JKR DB/T, interim valuations must becarried out at least once a month, unless a Payment Schedule isincluded in the Contract.
Comply with the method of valuation set out in Section 10.4.
For Information
SP JPS Bil. 2/2000 &
SP JPS Bil. 4/2008
2 Interim Valuation at Site
The SO shall make a first interim valuation based on the workswhich have been executed by the Contractor including theunfixed materials delivered to or adjacent to the Works.
Ensure the total value of claim reaches to the sum appeared inthe Appendix to the Conditions of Contract (for First InterimCertificate) whilst the subsequent claims must not less than theamount appeared (subsequent Interim Certificates) in the same
Appendix.
Inform the Contractor the method of valuation adopted by DID,to avoid disputes.
If the Contractor wishes to submit his interim claims (not arequirement under the Contract), then explain and agree withthe Contractor the format of claim.
Action By: CAO
Refer Form JKR 203/203A Clause 47(a); and Form JKR DB/T Clause
50.3(b)(i)
3 & 4 Check documents, and Prepare the Supporting Documents forPayment
Upon completion of the valuation, prepare the paymentdocuments.
Refer: Task List, and Checklist for Interim Payment.
Action By:CAO
See Appendix 10B
& Appendix 10C
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Step Procedures / Tasks Action By
/ Reference
3 & 4(Cont’d)
Check documents, and Prepare the Supporting Documents forPayment (Cont’d)
1st Valuation and Certification
Generally, the SO shall issue the Certificate within fourteen (14)days from the date of such valuation stating the due amount tothe contractor i.e. estimated total value of works executed andninety (90) percent of the value of the unfixed materials andgoods delivered at site. Variation of Price (if any) shall beincluded in the valuation.
Refer to the Appendix to the Conditions of Contract for theminimum value of work to be executed including materials andgoods to be delivered before 1st Interim Certificate will be
issued.
The amount due to the Contractor must be thereon and up tothe date of valuation.
The following documents must form part of 1st payment’sdocuments (unless already submitted under the application for
Advance Payment): Letter of Acceptance duly signed and witnessed Performance Bond, or Letter of Confirmation using
Performance Guarantee Sum Insurance Policies and receipt for insurance policies issued by
the insurance company Proof of registration with Socso Contractor’s letter stating bank details, and signed by
authorized person. Consultant’s certification of works done (if using Consultant). Form JKR66 Tasklist
The copies of relevant documents shall be certified by SO orSOR.
Fill-in and initials both the Task List (Borang Tindakan Kerja) for Interim Payment and Checklist for Preparation of Interim
Payment , and attach these to the documents.
Subsequent Interim Valuation and Certification Generally, the SO shall issue the subsequent interim certificatewithin fourteen (14) days from the date of such valuationstating the due amount to the contractor i.e. estimated totalvalue of works executed and ninety (90) percent of the value of the unfixed materials and goods delivered at site. Variation of Price (if any) shall be included in the valuation.
For information
Action By:CAO
Refer Appendix 10B & Appendix
10C
For information
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Step Procedures / Tasks Action By
/ Reference
3 & 4(Cont’d)
Check documents, and Prepare the Supporting Documents forPayment (Cont’d)
Subsequent Interim Valuation and Certification (Cont’d)
Refer to the Appendix to the Conditions of Contract for theminimum value of work to be executed including materials andgoods to be delivered before the Interim Certificate will beissued.
The following documents must be form part of the paymentdocuments:
Form JKR 66
Consultant’s certification of works done (if using Consultant) Task List (Borang Tindakan Kerja) for Interim Payment, duly
filled in and initialed.
Fill in and initials both the Task List for Interim Payment andChecklist for Preparation of Interim Payment , and attach theseto the documents
Advance Payment
Where Advance Payment was made, check and ensure that theamount to be recouped is stated in the payment certificate as acontractual deduction.
Refer to the Special Provisions to the Conditions of Contract forthe recoupment formula to be applied.
Generally, the recoupment of Advance Payments shall be madewhen the value of works reaches 25% and must fully recoupedat 75% works completed.
Action By:CAO
Action By:CAO
5 Checks documents for completeness
Check that each document is complete and/or in order. Refer tothe Checklist for Preparation of Interim Payment.
Fill in and initials the Checklist for Preparation of Interim Payment.
The recommending officer (Pegawai Pengesyor) shall sign theForm JKR66.
Submit Form JKR66, together with attached documents, to the Authorised Person for signature.
Action By:CAO
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Chapter 10 – PAYMENTS
Step Procedures / Tasks Action By
/ Reference
6 Issuance of Interim Certificate
If the Interim Payment document is duly completed, and thedocuments checked and endorsed by the relevant officers, theSO/Officer Empowered (Pegawai yang Memperakukan) shallsign and issue the Interim Certificate.
Forward documents to State or HQ for Quality Audit or paymentprocessing, depending on the value of the Contract.
Action By:SO
7 Quality Audit
Quality Auditor shall check the documents are in order and arefree of errors.
Action By:BUBK
8 Recording of Payment Details
Record payment in the relevant State / HQ section, as relevant.
Make duplicates of payment documents (except paymentvoucher).
Action By:Relevant State /
Division
9 Recording Payment Details & Prepare Payment Voucher
Ensure that the correct amount is entered into the vote book.
Check that the documents are in order, and ensure that thepayment voucher is signed
Submit to the relevant to Accountant General of issuance of payment:
Form JKR66, payment voucher and supporting documents
Action By:Finance Division
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Chapter 10 – PAYMENTS
10.6 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on payments.
Treasury Instructions
(Arahan Perbendaharaan)
[1] AP103: Semua Bil Dan Tuntutan Bayaran Hendaklah Dibayar Dengan Segera
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 7 Tahun 2006: Pindaan Ke Atas Arahan Perbendaharaan (AP103)
[2] Bil 3 Tahun 2008: Pelaksanaan Syarat Perubahan Harga Di Dalam Kontrak Kerja
DID Circulars
(Surat Pekeliling / Edaran JPS)
[1] SP JPS Bil. 2/2000: 2. Pindaan ke atas Borang JKR 66, Perakuan Pelarasan Jumlah HargaKontrak (PPJHK) dan Perakuan Muktamad
3. Pindaan Kepada Syarat-syarat Kontrak Berkaitan Bayaran
[2] SP JPS Bil 4/2008: Langkah-langkah Untuk Mempercepatkan Bayaran Interim (Pindaan kepadaPerkara 1 dalam SP JPS Bil. 2/2000)
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 10
– Payments
APPENDIX 10A
Checklist for Preparation OfAdvance Payment
[Form JKR 66]
(Senarai Semakan PenyediaanBayaran Pendahuluan)
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Chapter 10 – PAYMENTS
APPENDIX 10A CHECKLIST FOR PREPARATION OF ADVANCE PAYMENT(SENARAI SEMAKAN PENYEDIAAN BAYARAN PENDAHULUAN)
TAJUK
PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1. Pastikan penyediaan BayaranPendahuluan menggunakan BorangJKR66 (Pin. 3/99).
Tandakan
() selepassemakan
2. Pastikan permohonan Kontraktor untuk mendapatkan Bayaran Pendahuluanhendaklah dalam tempoh 3 bulan dariTarikh Milik Tapak.
3. Dokumen-dokumen yang perludisertakan bersama-sama Bayaran
Pendahuluan hendaklah seperti berikut :
(a) Keputusan Lembaga Perolehan /Surat Kelulusan KementerianKewangan / Surat KelulusanPegawai Kewangan Negeri, yangmana berkenaan.
(b) Surat Setujuterima Tender yangtelah ditandatangani oleh kontraktordan saksi.
(c) Gerenti Bank / Syarikat Insuran /
Syarikat Kewangan/Takaful bagiBayaran Pendahuluan.
(d) Gerenti Bank / Syarikat Insuran /Syarikat Kewangan / Takaful bagiBon Perlaksanaan, jika Kontraktormemilih dalam bentuk Gerenti.
(e) Surat pengesahan daripada Bank /Insuran / Syarikat Kewangan yangmengeluarkan para ( c ) di atas.
(f) Insuran Polisi Liabiliti Awam & Kerja(CAR).
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Chapter 10 – PAYMENTS
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
3.(samb.)
Dokumen-dokumen yang perludisertakan bersama-sama Bayaran
Pendahuluan hendaklah seperti berikut :(samb.)
(g) Resit Bayaran Premium untuk PolisiInsuran CAR.
(h) Surat daripada PERKESO yangmenyatakan khusus untuk projek berkenaan sahaja
(i) Surat daripada kontraktormenyatakan No. Akaun Bank :
(i) hendaklah ditandatangani oleh
orang yang diberi kuasa.(ii) lengkap dengan Nama, alamat
dan No. Akaun Bank
4 Pastikan Gerenti bagi BayaranPendahuluan teratur dari segi
(a) Format piawai,(b) Butiran Kontrak,(c) Nilai Gerenti,(d) Tempoh Gerenti,(e) Ditandatangani dan dicop oleh
Pegawai Bank / Syarikat Insuran /Syarikat Kewangan / Takaful,
(f) Duti setem telah dibayar
5 Pastikan semua salinan-salinan dokumendipara 3 disahkan oleh pegawaikumpulanpengurusan pengurusan danprofesional.
6 Pastikan perakuan dikemukakan kepadaPegawai Penguasa atau Wakil PP Utama
untuk ditandatangani dan tindakanseterusnya.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
*Audit Kualiti; Jika Berkenaan
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 10
– Payments
APPENDIX 10B
Task List for Interim Payment
[Form JKR 66]
(Borang TindakanKerja Bayaran Interim)
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Chapter 10 – PAYMENTS
APPENDIX 10B TASK LIST FOR INTERIM PAYMENT(BORANG TINDAKAN KERJA BAYARAN INTERIM BAGI KONTRAK
YANG WAREN PEERUNTUKANNYA DISALURKAN KE NEGERI)
Pegawai Penguasa :Tajuk Kerja :
No. Kontrak :Bayaran Interim No. :
Bil Proses Kerja TarikhPegawai
bertanggung jawab
Tandatangan
Catatan
1 Penilaian di tapak Penyelia Projek
2 Perakuan Bayaran Interim (JKR 66) siap Penyelia Projek
3 Tandatangan Pegawai Pengesyor PegawaiPengesyor
4 Hantar kepada Unit Ukur Bahan &
Kontrak JPS Negeri Penyelia Projek
5 Diterima oleh Unit Ukur Bahan &
Kontrak JPS NegeriPegawai JuruBahan/Kontrak
6 Semakan Audit Teknik Pegawai Juru
Bahan/Kontrak
7 Hantar kepada Unit Berkenaan di JPS
NegeriPegawai JuruBahan/Kontrak
8 Diterima oleh Unit Berkenaan di JPS
Negeri
Unit Projek JPS
Negeri
9 Semak Peruntukan dan Rekod bayaran Unit Projek JPS
Negeri
10 Tandatangan Pegawai Yang
Memperakukan
PegawaiPenguasa/Wakil P.P.
Jumlah Tempoh hari
11 Kemukakan kepada Bahagian Kewangan Unit Projek JPS
Negeri
12 Diterima oleh Bahagian Kewangan
13 Rekod perbelanjaan dan sedia baucer
14 Baucer bayaran ditandatangani
15 Hantar kepada Pihak Pembayar
Jumlah Tempoh * hari
JUMLAH TEMPOH KESELURUHAN * hari
Perhatian
Carta ini hendaklah dikepilkan bersama Perakuan Bayaran Interim (JKR 66) dan disimpan di dalam fail bayaranUnit Teknikal yang berkenaan.
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Chapter 10 – PAYMENTS
APPENDIX 10B TASK LIST FOR INTERIM PAYMENT(BORANG TINDAKAN KERJA BAYARAN INTERIM BAGI KONTRAK
YANG WAREN PEERUNTUKANNYA DI IBU PEJABAT JPSMALAYSIA)
Pegawai Penguasa :Tajuk Kerja :
No. Kontrak :Bayaran Interim No. :
Bil Proses Kerja TarikhPegawai
bertanggung jawab
Tandatangan
Catatan
1 Penilaian di tapak Penyelia Projek
2 Perakuan Bayaran Interim (JKR 66) siap Penyelia Projek
3 Tandatangan Pegawai Pengesyor Pegawai
Pengesyor
4 Tandatangan Pegawai Yang
Memperakukan
PegawaiPenguasa/Wakil P.P.
5 Hantar kepada Bahagian Ukur Bahan &
Kontrak Ibu Pejabat JPS Malaysia Penyelia Projek
6 Diterima oleh Bahagian Ukur Bahan &
Kontrak Ibu Pejabat JPS Malaysia Jurukur Bahan
7 Semakan Audit Teknik Jurukur Bahan
8 Hantar kepada Bahagian Berkenaan di
JPS M'sia. Jurukur Bahan
9 Diterima oleh Bahagian Berkenaan di
JPS M'sia.Unit Projek Bahagian
10 Rekod bayaran Unit Projek
Bahagian
11 Kemukakan kepada Bahagian Kewangan Unit Projek
Bahagian
Jumlah Tempoh hari
12 Diterima oleh Bahagian Kewangan
13 Rekod perbelanjaan dan sedia baucer
14 Baucer bayaran ditandatangani
15 Hantar kepada Pihak Pembayar
Jumlah Tempoh * hari
JUMLAH TEMPOH KESELURUHAN * hari
PerhatianCarta ini hendaklah dikepilkan bersama Perakuan Bayaran Interim (JKR 66) dan disimpan di dalam fail bayaranUnit Teknikal yang berkenaan.
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 10
– Payments
APPENDIX 10C
Checklist for Preparation OfInterim Payment
[Form JKR 66]
(Senarai Semakan PenyediaanBayaran Interim)
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Chapter 10 – PAYMENTS
APPENDIX 10C CHECKLIST FOR PREPARATION OF INTERIM PAYMENT(SENARAI SEMAKAN PENYEDIAAN BAYARAN INTERIM)
TAJUK PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK 2 AK* ULASAN
1. Interim No: - sila pastikan nombor
berturutan.
Tandakan ()selepas
semakan
2. Anggaran Pembangunan: KepalaPerbelanjaan, Pecahan Kepalahendaklah diisi sama seperti dalamdokumen kontrak.
3. No. Kontrak - hendaklah diisi samaseperti dalam dokumen kontrak.
4. Tarikh Penilaian: hendaklahmengikut tarikh penilaian sebenar.
(Pastikan Perakuan diterima selewat-lewatnya dua (2) minggu selepastarikh penilaian).
5. Pastikan nilai kerja mengikut'engineer's certification' berdasarkanCPM atau penilaian tapak (jika tiada
‘engineer’s certification’).
6. Nilai kerja dilaksanakan dan amaun-amaun lain yang kena dibayarhendaklah merangkumi :
(a) Nilai kerja Kontraktor Utamatermasuk APK dan PHK,
(b) 90% daripada nilai bahan binaandi tapak,
(c) Pelarasan turun naik harga(VOP),
(d) Nilai kerja Sub-KontraktorDinamakan termasuk APK danPHK,
(e) Nilai kerja Pembekal Dinamakantermasuk APK dan PHK,
(f) Bayaran kepada Juruperunding
(Bagi Kontrak Design & Build/Turnkey).
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Chapter 10 – PAYMENTS
BIL. KETERANGAN PMK1 PMK 2 AK* ULASAN
6.(samb.)
NOTA :
(i) V.O.P. untuk kerja bangunan"Current Index" yang digunakan
adalah untuk bulan sebelumbayaran Interim dinilaikan.
(ii) V.O.P. untuk kerja kejuruteraan Awam - "Current Price" adalahuntuk bulan bayaran Interimdinilaikan.
7. KURANGAN
(a) Pastikan amaun sebenar yangtelah dibayar untuk bayaran
interim terdahulu berasaskanbaucer bayaran.
(b) Pastikan jumlah nilai terkumpulbayaran Interim yang terdahuluditolak.
8. POTONGAN
a) Pastikan bayaran WangPendahuluan telah dibuat(samaada di Peringkat Negeri
atau Ibu Pejabat KualaLumpur).
b) Semak pengiraan bayaran balik Wang Pendahuluan, jika ada.
c) Semak dan pastikan jumlahamaun potongan terdahuluuntuk Wang JaminanPerlaksanaan (WJP) adalah10% daripada nilai kerjatertakluk kepada nilai
maksimum 5% daripada hargakontrak, jika kontraktor memilihkaedah WJP.
d) Semak kadar LAD/hari dantempoh yang dikenakan dansebarang Pengecualian (jikaada) berserta dengan rujukansurat.
e) Semak potongan lain-lain jikaada (sertakan lampiranketerangan).
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Chapter 10 – PAYMENTS
BIL. KETERANGAN PMK1 PMK 2 AK* ULASAN
9. Semak pengiraan bayaran disyorkan.
10. Tandatangan Pegawai Pengesyorhendaklah pegawai yang diberikuasa dan catitkan nama dan
jawatan.
11. Perakuan Bayaran :
(a) Pastikan amaun berasingan diperakukan untuk berikut :
i) Kontraktor Utamaii) Bayaran kepada
subkontraktor/ PenerimaBayaran (pastikan Lampiran A Borang JKR 66dilengkapkan)
(b) Pastikan nilai bersih potonganWang Jaminan Perlaksanaandicatitkan untuk dikreditkandalam akaun deposit
(c) Jumlah yang perlu dibayarhendaklah digenapkan kepada
ratus yang hampir.
(d) Pastikan perakuan dikemukakankepada Pegawai Penguasa atauWakil PP Utama untuk ditandatangani dan tindakanseterusnya.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
*Audit Kualiti; Jika Berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 11
VARIATIONS
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Chapter 11 – VARIATIONS
Table of Contents
Table of Contents .....................................................................................................................11-i
List of Flowcharts .................................................................................................................... 11-ii
11.1 INTRODUCTION.........................................................................................................11-2
11.2 PROCEDURES ............................................................................................................11-2
11.3 REFERENCE DOCUMENTS...........................................................................................11-6
11.4 REFERENCES .............................................................................................................11-6
APPENDIX 11A Checklist for Preparation of Variation Works Order (Senarai Semakan ArahanPerubahan Kerja)…………………………..……………………………………………..………... 11A-1
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Chapter 11 – VARIATIONS
List of Flowcharts
Flowchart Description Page
Flowchart 11.1 Variations 11-1
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Chapter 11 – VARIATIONS
Flowchart Description Action By Reference
1. SO Instruction is required SOR/PT
2a Is it a VO?
2b Any cost implication? SOR/PT
3. Issue SOI using JKR203U SOR/SO
4. Prepare approximate VOCosts
CAO
5. Net addition to ContractSum?
-
6. Prepare and submit Application for VO Approval (Form JKR-KPK)
SOR/CAO
7. Approval by VOCommittee?
VOCommittee
Refer Chapter 5 - Authority
8. Issue Variation Order toContractor (form JKR- APK), with copy to allrelevant parties
SOR/SO
9. Contractor complies withinstruction / variationorder
SOR/PjS
10. Actual VO value more thanthe approved amount?
-
11. Submit Form JKR-KPK to VO Committee
CAO
12. F inalisation of VO Value SOR Refer Chapter 12
Flowchart 11.1 – Variations
3
2b
4
8
9
12
1
No
6
5
7
11
10
END
Yes
No
Yes
No
Yes
No
Yes
2a
Yes
No
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Chapter 11 – VARIATIONS
11 VARIATIONS
11.1 INTRODUCTION
This chapter provides:
The guidelines and general procedures on the process and approval of variations works andother changes to the Contract.
Notes:
“Variation” of Works may be defined as any alteration or modification of the design, specificationand/ or Bills of Quantities of the Works as shown upon in the Contract Drawings and described orreferred to in the Contract Bills, and includes the addition, omission or substitution of any works.
The Treasury Instruction (Arahan Perbendaharaan) 202 states that each Variation must comply with
the following criteria:
The contract period has not ended when the Variation Order (APK) is issued;
The Variation shall not change or alter a major part of the original scope of works;
For additional works, the Variation works must be carried out on Site; and
For substitution of works, the Variation works must be within the original scope of contract,and the original scope of works (or substituted works) must be identifiable in the Variationworks.
11.2 PROCEDURES
Please refer to Flowchart 11.1 – Variations.
Step Procedures / Tasks Action By
/ Reference
1, 2 and 3 SO Instruction and Variation Order
The SO may issue instructions requiring a variation and hemay sanction in writing any variation made by the Contractor.
The SO may issue instruction on any matter, which the SO is
empowered to do so under the Contract, including variationworks as described in the Contract.
SO and his representatives shall ensure and comply therequirements of Treasury Circulars 202, which stipulates thatprior approval of the relevant authority must be obtainedbefore instruction requiring work to be varied may be issued.
The instruction may or may not involve cost implications; if the instruction does not involve cost implications, use FormJKR- 203U, or otherwise use Form JKR-APK for instructionwhich incurs cost implications.
Action by :SOR/PT/SO
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Chapter 11 – VARIATIONS
Step Procedures / Tasks Action By
/ Reference
4 & 5 Prepare approximate VO Costs
Refer Checklist for Variation Works.
Prepare the estimated costs of the Variation Order (VO)works. The cost estimates should be as accurate as possiblebased on information available and be supported by details.
The circumstances upon the preparation of estimated Variation Order (VO) cost:
If the estimates show nett additional to the ContractSum, then the SOR or CAO shall prepare a Form JKR-KPK for approval by VO Committee.
If the estimates show reduction (or no addition) tothe Contract Sum, then the SO shall issue aninstruction using Form JKR-APK (Variation Order toContractor)
For very urgent works, indicative estimates or ‘ball park figures’ may be used, but the estimates must besubstantiated as soon as possible.
No Variation works should be carried out prior to the approvalof Variation Order Committee.
Action by:PM/CAO/SO
6 Application for VO Approval
Check that there is sufficient budget or allocation for the Variation Order.
The application to VO Committee shall comprise:
Application for Approval of Variation Order (FormJKR-KPK) – duly certified by the SO (see part D of theform)
VO Costs Estimates (with supporting details)
Justification for the needs of VO
Submit all documents to the VO Secretariat.
Action by : PH/CAO
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Chapter 11 – VARIATIONS
Step Procedures / Tasks Action By
/ Reference
7 Approval by VO Committee
Approval for Variation Order (VO) must be given by
(i) Variation Order Committee, or(ii) the Ministry of Finance (MoF),
depending on the Contract Sum and aggregate value of variation works.
For composition and limits of authority of the VO Committee,please refer Chapter 5.
Note that the officer who applies for the Variation Ordercannot be the chairman or member of the Variation Order
Committee.
Where approval of MoF is required, the application for VOapproval shall be checked by BUBK at the DID headquarters,and submitted through the Director General of DID.
Action by :SOR/CAO
8 Issue Variation Order to Contractor
Prepare the Variation Order (use the current Form JKR-APK)and issue to the Contractor.
All particulars in the Form JKR-APK must be correctlyinserted. All space for information / insertion must be
filled.
The date of the Variation Order is the date on which it issigned by the Authorised Party.
Description of the work to be varied must be clear andconcise.
All relevant drawings, sketches and other details areappended.
The Contract Sum shall be adjusted accordingly by the
amount stated in the (Form JKR-APK).
The SO must sign the Form JKR-APK and copied to allrelevant parties.
Action by :SOR/CAO
Refer Chapter 5 – Appendix 5A
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Chapter 11 – VARIATIONS
Step Procedures / Tasks Action By
/ Reference
9 Contractor complies with instruction / variation order
The Contractor shall acknowledge receipt and compliance
with the VO instruction (Form JKR-APK).
The Contractor is required to comply with the SuperintendingOfficer’s instruction or the Variation Order within 7 days of receipt of the same.
Action by : SOR/PjS
10 & 11 Actual VO value more than approved amount
Where the actual costs of VO is more than the approvedamount for the particular VO, the SO is required to submit theadditional costs under new application (JKR-KPK) to the
Variation Committee for approval based on the aggregate
value of VO todate.
For composition and limits of authority of the VO Committee,please refer Chapter 5.
Action by :SOR/CAO
12 Finalisation of VO Value
Every amount stated in the Form JKR-APK is provisional andtemporary only, and must be finally adjusted through FormJKR-PHK.
For adjustment of Contract Sum based on the final value of variation works, the amount stated in the JKR-PHK shall be
the difference between the final VO value and the amountstated in the JKR-APK. If there is no difference, the JKR-PHK shall state “zero”.
For information
See also Chapter 12 – Adjustment of
Contract Sum
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Chapter 11 – VARIATIONS
11.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
Form JKR 203U: Arahan Melibatkan Perubahan Kerja
Form JKR-KPK: Permohonan Untuk Mendapatkan Kelulusan Perubahan Kerja
Form JKR-APK: Arahan Perubahan Kerja
Form JKR-PHK: Pelarasan Harga Kontrak
11.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the calling and receipt of tenders.
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 7 Tahun 2007: Peraturan Perubahan Kerja (Variation Order)
Treasury Instruction(Arahan Perbendaharaan)
[1] Arahan Perbendaharaan 202: Arahan Perubahan Kerja
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS Bil. 2/2008: Peraturan Mengenai Arahan Perubahan Kerja dan Pelarasan Harga BagiKontrak Kerja
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 11
– Variations
APPENDIX 11A
Checklist for Preparation ofVariation Works Order
[Form JKR APK]
(Senarai Semakan Arahan Perubahan Kerja)
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Chapter 11 – VARIATIONS
APPENDIX 11A CHECKLIST FOR PREPARATION OF VARIATION WORKS ORDER (SENARAI SEMAKAN ARAHAN PERUBAHAN KERJA)
TAJUK PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
No. Kontrak HargaKontrak
RM
P.P Dalam Kontrak
Had Kewangan PK P.P RM
Jumlah Nilai APK Tambahan Yg. Telah LulusJumlah Nilai APK KuranganJumlah Peratusan APK Tambahan Yang Telah LulusBil. APK Yang Telah Dikeluarkan
RMRM%
Tarikh TerimaPermohonan
No. APK YangDisemak
Tajuk Kerja APK
Nilai Anggaran APK (Sertakan butiran anggaran/pengesahan anggaran)
RMKURANGAN/TAMBAHAN
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
A PK KURANGAN - Pastikan :Tandakan ()selepassemakan
1. Ada surat permohonan dari Jabatan/Kementerian Pelanggan yangditandatangani oleh Pegawai DiberiKuasa, jika PK diminta oleh Pelanggan.
2. Nilai bersih adalah hasil penilaian PK untuk bahagian/elemen/komponen kerjayang sama.
3. Kerja tidak diperlukan dan tidak akandilaksanakan.
B PK TAMBAHAN – Pastikan :
1. Ada surat permohonan dariJabatan/Kementerian Pelanggan yangditandatangani oleh Pegawai Diberi
Kuasa, jika PK diminta oleh Pelanggan.
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Chapter 11 – VARIATIONS
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
B PK TAMBAHAN (samb…)
2. Skop kerja dirangkumi oleh Kontrak (within scope of Contract).
3. Arahan perlaksanaan kerja masih dalamtempoh Kontrak.
4. Perlaksanaan kerja tidak menyebabkangangguan kepada kemajuan kerja/tempohpenyiapan Kontrak.
5. Peruntukan mencukupi untuk melaksanakan kerja.
6. Surat kelulusan KementerianKewangan/Perbendaharaan Negeri jika PK menyebabkan nilai jumlah harga Kontrak melebihi peruntukan projek.
7. Surat kelulusan Ketua Setiausaha Kem.Kewangan jika nilai PK Tambahanmelebihi 30% atau RM 6.0 Juta dariJumlah Harga Kontrak mengikut yangmana lebih rendah.
C BORANG APK
1. Format Borang yang digunakan adalahJKR-APK yang terkini
2. Satu Borang APK bagi satu PK
3. Tandatangan hendaklah P.P. yangdinamakan dalam Kontrak
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Audit Kualiti; Jika Berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 12
ADJUSTMENT OF CONTRACT SUM
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
Table of Contents
Table of Contents .....................................................................................................................12-i
List of Flowcharts .................................................................................................................... 12-ii
12.1 INTRODUCTION.........................................................................................................12-2
12.2 PROCEDURES ............................................................................................................12-2
12.3 REFERENCE DOCUMENTS...........................................................................................12-5
12.4 REFERENCES .............................................................................................................12-5
APPENDIX 12A Checklist for Adjustment of Contract Sum (Senarai Semakan Penyediaan PelarasanHarga Kontrak)…………………………..……………………………………………..……………. 12A-1
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
List of Flowcharts
Flowchart Description Page
Flowchart 12.1 Adjustment of Contract Sum 12-1
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
Flowchart Description Action By Reference
1. Adjustment to ContractSum is required
-
2. Determine if and whensuch adjustment can bemade. Make the
necessary adjustmentsfor:
CAO
(a) Variation Orders
(b) Adjustment for PrimeCost Sums
(c) Adjustment for Provisional Sums
(d) Remeasurement of Provisional Quantities
(e) Variation of Prices
(f) Approved contractualclaims
(g) Errors or omissions inBills of Quantities
3. Issue the Certificate of Adjustment of Contract
Sum (Form JKR- PHK)
SO/CAO
Flowchart 12.1 – Adjustment of Contract Sum
1
2
3
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
12 ADJUSTMENT OF CONTRACT SUM
12.1 INTRODUCTION
This chapter provides:
The guidelines and general procedures for the adjustment of Contract Sum.
12.2 PROCEDURES
Please refer to Flowchart 12.1 – Adjustment of Contract Sum.
Step Procedures / Tasks Action By
/ Reference
1 Generally
The Contract Sum shall be adjusted upon the issuance of JKR- APK to indicate the approved temporary value.
Every JKR-APK must be adjusted through JKR-PHK based onthe approved amount in JKR-KPK regardless of its value ischanged or not. However the value shows in the Form JKR-PHK is net difference between temporary value and ultimatevalue.
For Information
See SPP 5/2007 - Peraturan Pelarasan
Harga Kontrak
2 Adjustment of Contract Sum
Refer to Checklist for Adjustment of Contract Sum.
Determine the reasons for adjustment of Contract Sum. It ispermitted under the following circumstances only:
Action by: CAO
Refer: Appendix 12A
a) Variation Orders
Every issuance of JKR-APK must be followed by the issuanceof Form JKR-PHK.
The provisional amount stated in the JKR-APK must befinalized through Form JKR-PHK, even if there is no differencebetween the provisional amount and the final value of the
Variation works.
Check that the Variation Order (JKR-APK) is issued.
The adjustment is made as soon as the value of the variationwork is certified.
Refer Chapter 11 - Variations
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
Step Procedures / Tasks Action By
/ Reference
b) Adjustment of Prime Cost Sums
Check that the works is awarded to the nominated sub-
contractor/ supplier. Omit the original PC Sum and add theawarded NSC’s/ NS’s contract sum and profit and attendancewhich is allowed in Contract.
The final adjustment is made after completion of works andfinal cost is ascertained.
Refer also Chapter 20
– PC and Provisional Sum.
c) Adjustment of Provisional Sums
The Provisional Sums may be expended as follows:
Works shall carried out by Main Contractor,
Works shall be omitted from Contract, and tenderedout to third party, or Works shall be carried out by Nominated sub-
contractor / nominated supplier.
If the works under a Provisional Sum is carried out by NSC/NS, and if the Main contractor is entitled to ‘profit andattendance’ stated under the terms of the Contract and DIDcircular, then this must be included in the PHK.
Ensure ‘Borang E’ and ‘Borang F’ (where applicable) is signedby Authorised Person.
Check that the work or supply under a provisional sum isapproved in accordance with the DID procurementprocedures.
The adjustment is made as soon as the net costs of the works / supply is approved.
Refer also Chapter 20
– PC and Provisional
Sum
d) Remeasurement of Provisional Quantities
The final remeasurement to the Provisional Quantities is madeas soon as works is completed and the quantities can beaccurately measured.
If there is a net increase in quantities, approval from theCommittee must be obtained for the additional quantities.
If there is further increased upon the approval of additionalworks, the approval by the same or higher ranking of Committee must be obtained using Form JKR-KKS. Refer tothe guidelines in SPP7/2007 Lampiran V.
If no nett increased or changed in quantities, no approval isrequired but still need to be adjusted.
Please refer to the current Treasury
Instruction No. 202,
Schedule 3
Refer to the Guidelines in SPP
7/2007 - Lampiran V.
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
Step Procedures / Tasks Action By
/ Reference
e) Variation of Prices
The Variation of Prices exercise must be carried out monthly
in Interim Payment, and the final adjustment is made afterthe whole of the Works is completed.
For the Civil Works, ensure the adjustments made must notexceed the quantities allowed in Contract.
The valuation and calculation must be in accordance with theSpecial Provisions to the Conditions of Contract.
Please refer to SPP 3/2008
f) Approved Contractual Claims
The adjustment to the Contract Sum may be made after the
contractual claims had been approved by the ClaimCommittee, or Ministry of Finance, as the case may be.
Ensure every claim by Contractor must be checked andevaluate by SO prior forward to Claim Committee. Five (5)copies applications must be attached with SO report beforesend to Claim Committee Secretariat.
g) Errors in Bills of Quantities
The error of quantities/ or error in description/ or omission of works in the Bills of Quantities is not considered a variation of works, but to be adjusted through Form JKR-PHK.
This adjustment is applicable to contracts let under Form JKR,under Clause 26.
3 Approval of Certificate of Adjustment of Contract Sum
Check that all the details are correct.
The Form JKR- PHK must be signed by the SuperintendingOfficer (or Project Director, as the case may be) named in theContract.
Action by: CA
Action by: CA
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
12.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
Permohonan Kelulusan Tambahan Kuantiti Sementara (Borang D)
Permohonan Kelulusan Wang Peruntukan Sementara (Borang F)
Perakuan Pelarasan Harga Kontrak (Borang JKR-PHK Pind. 1/2001)
Borang Kelulusan Kuantiti Sementara (JKR-KKS)
12.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the adjustment of contract sum.
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 7 Tahun 2007: Peraturan Arahan Perubahan Kerja (Variation Order)
[2] Bil 3 Tahun 2008: Pelaksanaan Syarat Perubahan Harga Di Dalam Kontrak Kerja
[3] Bil 5 Tahun 2007: Peraturan Pelarasan Harga Kontrak
Treasury Instructions(Arahan Perbendaharaan)
[1] AP 202: Definisi dan Kriteria Arahan Perubahan Kerja
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS Bil. 3/2008: Peraturan Mengenai Arahan Perubahan Kerja dan Pelarasan Harga BagiKontrak Kerja
[2] SPJPS1/2007: Peraturan Mengenai Wang Peruntukan Sementara
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 12
– Adjustment of Contract Sum
APPENDIX 12A
Checklist forAdjustment of Contract Sum
[Form JKR PHK]
(Senarai Semakan PenyediaanPelarasan Harga Kontrak)
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
APPENDIX 12A CHECKLIST FOR ADJUSTMENT OF CONTRACT SUM (SENARAI
SEMAKAN PENYEDIAAN PELARASAN HARGA KONTRAK)
TAJUK PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
No. Kontrak Harga Kontrak RM
P.P Dalam Kontrak
Had KewanganPHK P.P
RM
Jumlah Nilai PHK Tambahan Yang Telah Dikeluarkan
Jumlah Nilai PHK Kurangan Yang Telah DikeluarkanJumlah Bersih PHK TerkumpulBilangan PHK Yang Telah Dikeluarkan
RM
RMRM
Tarikh TerimaPermohonan
No. PHK YangDisemak
Tajuk KerjaPHK
Nilai Anggaran PHK (Sertakan butiran anggaran/pengesahan anggaran)
RMKURANGAN/TAMBAHAN
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
BHG. 1 TUJUAN PHK(Pilih Yang Berkenaan)
Tandakan ()
selepassemakan
A MEMUKTAMADKAN APK.
1. Kelulusan J/K PHK mengikut AP 202.2dalam Borang JKR - KPK (Terkini) bagi PHK Tambahan sahaja.
2. Pengukuran kuantiti yang berkenaan telahdimuktamadkan
3. Kadar Harga yang berkenaan telahdimuktamadkan
B PELARASAN WANG KOS PRIMA
1. Kerja telah diawadkan kepadasubkontraktor/pembekal.
2. Jumlah keuntungan dan caj layananKontraktor telah diambilkira.
3. Jumlah Wang Kos Prima termasuk jumlahkeuntungan dan caj layanan di dalamKontrak telah diselaraskan.
4. Pastikan pelarasan mengambilkira PK
ke atas kerja Wang Kos Prima.
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
BHG. 1(samb.)
TUJUAN PHK (samb.)(Pilih Yang Berkenaan)
C PERBELANJAAN WANG PERUNTUKANSEMENTARA
1. Jumlah harga kerja, perkhidmatan ataubekalan telah ditentukan mengikut tatacaraperbelanjaan Wang Peruntukan Sementaramengikut panduan proses perolehan kerja.
2. Jumlah yang diperuntukan di dalam Kontrak sebagai Wang Kos Sementara untuk kerja,perkhidmatan atau bekalan telahdiselaraskan.
3. Kelulusan Pegawai jika jumlah nilai kerja,perkhidmatan atau bekalan yangdijangkakan melebihi 30% daripada jumlahyang diperuntukan di dalam Kontrak,kecuali perolehan kerja /perkhidmatan /bekalan diluluskan oleh LembagaPerolehan. Rujuk SP JPS 1/2007.
D PENGUKURAN SEMULA KUANTITISEMENTARA
1. Pengukuran kuantiti sementara di dalamKontrak telah dimuktamadkan.
2. Kelulusan Jawatankuasa Tambahan KuantitiSementara mengikut A.P. 202 Jadual IIIdalam Borang JKR - KKS (jika perlu )
E PERLAKSANAAN SYARAT TURUN NAIK HARGA
1. Kesemua perkiraan bulanan turun naik harga hingga tarikh siap Kontrak telahdiselesaikan.
2. Semua Pelarasan Harga Kontrak diluluskan.
3. Pelarasan perkiraan turun naik harga telahdisediakan apabila keseluruhan kerja didalam Kontrak telah disiapkan.
F KELULUSAN TUNTUTAN KONTRAKTOR
1. Pastikan kelulusan J/K Tuntutan.
2. Sertakan kelulusan Kementerian Kewangan / Perbendaharaan Negeri bagi tuntutan ex- gratia dan tuntutan di luar terma Kontrak.
3. Butiran Penilaian Jumlah Amaun Tuntutanyang diluluskan disertakan.
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Chapter 12 – ADJUSTMENT OF CONTRACT SUM
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
BHG. 1(samb.)
TUJUAN PHK (samb.)(Pilih Yang Berkenaan)
G KESILAPAN KUANTITI/PENINGGALANKERJA DALAMSENARAI KUANTITI
1. Butiran perkiraan jumlah harga akibatkesilapan/peninggalan kerja dalam SenaraiKuantiti disediakan.
2. Surat pengesahan mengenaikesilapan/peninggalan kuantiti daripadaPejabat / Perunding yang menyediakanSenarai Kuantiti berkenaan.
BHG. 2 BORANG PELARASAN HARGA KONTRAK (JKR-PHK)
1. Format Borang yang digunakan adalah JKR-PHK yang terkini.
2. Pelarasan harga kontrak dimasukan didalam Bayaran Interim.
3. Tandatangan hendaklah Pegawai Penguasayang dinamakan dalam Kontrak.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Audit Kualiti; Jika Berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 13
DELAYS AND
EXTENSION OF TIME
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Chapter 13 – DELAYS AND EXTENSION OF TIME
Table of Contents
Table of Contents .....................................................................................................................13-i
List of Flowcharts .................................................................................................................... 13-ii
13.1 INTRODUCTION ............................................................................................................13-3
13.2 PROCEDURES................................................................................................................13-3
13.3 DELAY AND EXTENSION OF TIME ..................................................................................13-5
13.4 PURPOSE OF EXTENSION OF TIME PROVISIONS ............................................................13-5
13.5 GROUNDS FOR EXTENSION OF TIME IN STANDARD FORMS OF CONTRACT.....................13-5
13.6 POINTS TO REVIEW FOR CONSIDERATIONS OF EXTENSION OF TIME .............................13-6
13.7 METHODS FOR ASSESSMENT OF EXTENSION OF TIME ...................................................13-6
13.8 REFERENCE DOCUMENTS ..............................................................................................13-7
13.9 REFERENCES.................................................................................................................13-7
APPENDIX 13A Checklist for the Preparation of Certificate of Delay and Extensionof Time (Senarai Semakan Penyediaan Perakuan Kelewatan danLanjutan Masa) …………………………………………………………………………………..….. 13A-1
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Chapter 13 – DELAYS AND EXTENSION OF TIME
List of Flowcharts
Flowchart Description Page
Flowchart 13.1 Delay 13-1
Flowchart 13.2 Extension of Time 13-2
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Chapter 13 – DELAYS AND EXTENSION OF TIME
YES NO
YES
REFER TO CHAPTER 14 -NON-COMPLETION
Flowchart 13.1 – Delay
Delay become apparent; SOR issues warningletter to Contractor
Contractor to explain / issue letter explaining onreasons of delay
Acceptance
SOR to issue warning letter toContractor informing on his intention
to issue Certificate of Non-Completion and impose Liquidated
and Ascertained Damages
Reasons of delayare acceptable asper contract?
Contractor to continue work and at thesame time SOR to prepare Certificate
of Non-Completion for the approvaland signature of Authorised Party
Prepare Certificate of Delay and Extensionof Time for approval and signature of
Authorised Party
NO
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Chapter 13 – DELAYS AND EXTENSION OF TIME
Flowchart Description Action By Reference
1. Notice of Delay and Application for extensionof time.
-
2. Assess the application forextension of time; reasonsfor delay and quantum of delay.
SOR
3. Contractor eligible forextension of time?
SOR
4. Prepare report andCertificate of Delay andExtension of Time.Submit for the approval of Authorised Party.
SOR Refer: Checklist for
Preparation of Certificate of
Delay and Extension of
Time 5. Check report of Delay and
Extension of TimeCAO
6. Issue Certificate of Delayand Extension of Time tothe Contractor.
SOR
7. Completion of Works isdelayed and there is nomatter entitling theContractor to an extensionof time? Issue warningletters, and if delayed
beyond Date forCompletion then issueCertificate of Non-Completion and imposeLiquidated and Ascertained Damages.
- Refer: Chapter 14
Flowchart 13.2 – Extension of Time
1
6
2
4
5
No
Yes
3
7
Yes
No
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Chapter 13 – DELAYS AND EXTENSION OF TIME
13 DELAYS AND EXTENSION OF TIME
13.1 INTRODUCTION
This chapter provides:
An overview of the delay and extension of time provisions and procedure for works contracts The standard forms of contract use for DID projects
13.2 PROCEDURES
Please refer to Flowchart 13.1 – Delay and Flowchart 13.2 – Extension of Time.
Step Procedures / Tasks Action By
/ Reference
1 Notice of Delay and Application for extension of time
Contractor to put in application for extension of time as soonas it becomes apparent that the progress of the Works isdelayed.
Contractor to extent Performance Bond and all Insurancesuntil the estimated new completion date.
For information
2 Assess the application for extension of time
It is the duty of the SOR to review the extension of timeapplication based on the supporting documents submitted by
Contractor.
SOR to assess reasons and quantum of delay as allowed andacceptable grounds in contract.
Action by: SOR
Refer : AP201 – Perubahan Dan
Pelanjutan Tempoh Kontrak Untuk
Kontrak Bekalan Dan Perkhidmatan
3 Contractor eligible for extension of time?
If Contractor is eligible, determine new Date of Completion.If not eligible, go to step 7.
Action by: SOR
4 Prepare report and Certificate of Delay and Extension of Time. Submit for the approval of Authorised Party
After determining new Date for Completion, prepare reportof Delay and Extension of Time complete with grounds,quantum and calculation.
Submit report and Certificate of Delay and Extension of timefor approval from Authorised Party.
Use the latest Form JKR 203T.
Action by: SOR
Refer to Checklist for the Preparation of
Certificate of Delay and Extension of
Time.
5 Check report of Delay and Extension of Time
Submit the report to the CAO for verification.
Action by: CAO
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Chapter 13 – DELAYS AND EXTENSION OF TIME
Step Procedures / Tasks Action By
/ Reference
6 Issue Certificate of Delay and Extension of Time to theContractor
As soon as it is approved issue to Contractor the Certificateof Delay and Extension of Time and inform on new Date forCompletion.
Action by: SOR
7 Completion of Works is delayed and there is no matterentitling the Contractor to an extension of time?
Refer Chapter 14 – Non-completion
For information
Refer: Chapter 14 – Non-completion
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Chapter 13 – DELAYS AND EXTENSION OF TIME
13.3 DELAY AND EXTENSION OF TIME
Most construction contracts will specify a time for completion. The contractor is obliged to completethe works within the stipulated date subject to any extension of time.
Time is of the essence is a phrase loosely used in construction contracts to underscore theGovernment’s insistence on the contractor’s performance obligation by the stipulated date of completion. It often has to do with extension of time application by contactors and for disruption anddelays with related money application in the form of direct loss and/or expense application and onthe Government’s side, the right to Liquidated And Ascertained Damages for delays on the part of the Contractor.
Time will be at large where the extensions of time provisions have been improperly applied oradministered, or where the original time for completion has been waived.
13.4 PURPOSE OF EXTENSION OF TIME PROVISIONS
For the Government
Enables to fix a new completion date Keeps alive the Government’s right to Liquidated And Ascertained Damages
For the Contractor
Reduces the liability to pay Liquidated And Ascertained Damages May entitle to claim for prolongation costs incurred
Other consequences
Avoids time being at large Extinguishes the previously issued certificate of non-completion (if any)
13.5 GROUNDS FOR EXTENSION OF TIME IN STANDARD FORMS OF CONTRACT
The grounds of extension of time allowed in JKR 203A form of contract is under Clause 43: Delaysand Extension of Time as follows:-
a) Force majeureb) Exceptionally inclement weatherc) Instructions consequential upon disputes with neighbouring ownersd) Fire or other insurable damagee) Compliance with S.O’s / P.D.’s instruction for discrepancies, variations, date of commence
and completion or postponementf) Late issue of instruction, drawings, levels or instruction in regards to NSC/NSg) Delay in giving possession of siteh) Civil commotion, strike or lockouti) Delay by artists, tradesmen and other direct contractors
j) Shortages of labour or materialsk) Delay by NSC/NS
In JKR Design & Build / Turnkey Contract (2002 Edition) the relevant clause for Delay and Extensionof Time is found in Clause 45.
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Chapter 13 – DELAYS AND EXTENSION OF TIME
Other requirements related to submission of extension of time application by contractor include:-
Notice Provisions
a) Provide advance warning of delays so that necessary mitigation measures can be
undertaken before it become too lateb) When it becomes reasonable apparent
13.6 POINTS TO REVIEW FOR CONSIDERATIONS OF EXTENSION OF TIME
It is the duty of the SOR to review the extension of time claim.
a) Records and Contract Provisions- Actual facts and record are critical- Programmes and notices should not be ignored or left
b) Sequence of works
- The order in which works logically have to take place
c) Critical paths- Those items which must be completed in a certain order
d) Use of float time- Spare time / capacity in the programme between critical events- Over estimation of activity durations
e) Ownership of float- As a general rule, the party which needs it uses it
f) Mitigation measures undertaken by contractor- Limitation of actual delay impact- Contractor must progress work diligently
g) Contractual duties- Contractor must limit the impact of any delay- S.O / P.D. should grant extension of time as the works progress, wherever possible
h) Concurrency- A number of competing connected events- A number of unrelated events occurring at the same time
i) Dominant cause
- The event which really causes the delay- Usually determined by using as-built programmes / critical path analysis
13.7 METHODS FOR ASSESSMENT OF EXTENSION OF TIME
a) Based on programme analysis – Critical Path Method (CPM) / As built
b) Must demonstrate actual cause and subsequent event
c) Net vs. Gross Assessments- Granted extension of time to be added to previous Completion Date- Assessment based upon time related to the relevant event
- Not a consideration of when the event actually occurred
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Chapter 13 – DELAYS AND EXTENSION OF TIME
d) Nominated Sub-Contractors or Nominated Supplier- Delays caused by NSC / NS (such delay shall be cause by the same reasons affecting
their work as stated in item 13.5 (a) – (i)) are acceptable grounds provided theContractor has done all possible to mitigate loss of time
e) Direct Contractors- Delays caused by Direct Contractors are not acceptable grounds
13.8 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents mentioned in theprocedures or processes outlined in this Chapter.
Form JKR 203T (Pin. 4/83) : Perakuan Kelambatan dan Lanjutan Masa
13.9 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the administration of delays andextension of time.
Treasury Circular(Surat Pekeliling Perbendaharaan / Surat Arahan Perbendaharaan)
[1] Surat Arahan Perbendaharaan S/K.KEW/PK/PP/1100/000000/10/31 Jld. 22 (7) 16 Mei 2007:Pelanjutan Masa (Extension of Time) Bagi Kontrak Projek Kerja
Treasury Instructions(Arahan Perbendaharaan)
[1] AP 201: Perubahan Dan Pelanjutan Tempoh Kontrak Untuk Kontrak Bekalan Dan Perkhidmatan
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS.UB 1/1995: Perlantikan Pegawai Penguasa, Perwakilan Kuasa Pegawai Penguasa danPegawai-Pegawai Yang diberi Kuasa Dalam Urusan Pentadbiran Kontrak.
[2] SP JPS Bil. 1/2003: Perlantikan Pegawai Penguasa (P.P), Perwakilan Kuasa Pegawai Penguasa(Wakil P.P) Dan Pegawai-Pegawai Yang Diberi Kuasa (PYDK) Dalam Urusan Pentadbiran Kontrak.(Tambahan kepada Surat pekeliling SPJPS.UB 1/1995)
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Chapter 13 – DELAYS AND EXTENSION OF TIME
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 13 – Delays and Extension of Time
APPENDIX 13A
Checklist for thePreparation of Certificate of
Delay and Extension of Time
[Form JKR 203T]
(Senarai Semakan PenyediaanPerakuan Kelewatan dan Lanjutan Masa)
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Chapter 13 – DELAYS AND EXTENSION OF TIME
APPENDIX 13A CHECKLIST FOR THE PREPARATION OF CERTIFICATE OF DELAY AND EXTENSION OF TIME (SENARAI SEMAKAN PENYEDIAANPERAKUAN KELEWATAN DAN LANJUTAN MASA)
TAJUK PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1. (i) Perakukan Kelambatan danLanjutan Masa hendaklahdisediakan sebaik sahaja tempohkelambatan dapat ditentukan, danseboleh- bolehnya tidak lewatdaripada dua bulan sebelumberakhirnya tempoh siap kontrak.
Tandakan (
)selepas semakan
(ii) Pastikan Kontraktor telahmengemukakan permohonan untuk lanjutan masa secara bersuratdengan menyatakan alasan- alasan
kelewatan, tempoh lanjutan masayang diperlukan dan sebagainya.
(iii) Pastikan semua polisi Insuran, BonPerlaksanaan (sekiranyarecoupment belum habis dibuat)telah dilanjutkan oleh kontraktoruntuk tujuan lanjutan masa ini.Sekiranya kontraktor gagalmelanjutkan polisi insuran, PMK hendaklah menguruskan pelanjutan(hendaklah ditolak daripada wangyang kena bayar kepadakontraktor).
2. Borang yang digunakan ialah JKR 203Tyang terkini.
Muka surat 1 (Borang 203T)
3. KERAJAAN – bermaksud ‘KERAJAANMALAYSIA’ bagi projek Persekutuanatau ‘KERAJAAN ......’ BAGI PROJEK Negeri.
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Chapter 13 – DELAYS AND EXTENSION OF TIME
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
4. PKLM No. – sila pastikan nomborberturutan.
5. Rujukan – sila masukkan nombor failprojek pejabat Pegawai Penguasa yangmenyediakan.
6. Pejabat – isikan alamat pejabat PegawaiPenguasa.
7. Tarikh - Tarikh PKLM ditandantanganioleh Pegawai Penguasa.
8. Kepada ( Nama dan alamat kontraktor),Kelas Pendaftaran, No. kontrak dannama kontrak - hendaklah sama sepertiyang terdapat di dalamdokumen kontrak.
9. Bahagian - masukkan nama penyiapanbahagian- bahagian(jika berkenaan) sepertimana yangdinyatakan dalam lampiran kepadaSyarat-Syarat Kontrak JKR 203/203A semakan 10/83 Klausa 41.
10. Para 1 –
(i) Masukkan Tarikh Siap Asal atauLanjutan yang telah diluluskansebelumnya.
(ii) Nyatakan sebab-sebab iaitu alasan-alasan yang menyebabkanberlakunya kelewatan ataukelambatan kerja sepertimana yangdibenarkan di bawah klausa 43Syarat-syarat Kontrak. Lampirkan
sinopsis dan dokumen-dokumensokongan yang lengkap danmunasabah sesuai dengan setiapalasan/sebab- sebab yang diberi.
iii) Klausa - sila nyatakan sub-klausauntuk klausa 43 yang bersesuaiandengan setiap alasan/sebab yangdikemukakan.
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Chapter 13 – DELAYS AND EXTENSION OF TIME
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
10(Samb.) (iv) Tempoh Kelambatan dan Lanjutan
Masa – nyatakan tempoh dalamkiraan hari dan tarikh sebenar
berlakunya kelambatan tersebut (didalam kurungan)
Muka surat 2 (Borang 203T)
11 Para 2 - masukkan jumlah bilangan hariyang diperakukan untuk lanjutan masa.Jumlah hari bertindih hendaklah ditolak dari jumlah keseluruhan.
12 Para 3 –
(i) Tarikh siap yang ditetapkanhendaklah sama seperti mana yangdinyatakan di dalam Para1(i).
(ii) Tarikh dilanjutkan ialah tarikh barusetelah tarikh siap ditetapkandicampurkan dengan jumlah haripada Para 2 iaitu :-
Tarikh lanjutan masa baru = Tarikh
Para 1 + bilangan hari Para 2
Maklumat Tambahan
13 Sebarang maklumat tambahan seperti :-
(i) Peratus Kemajuan Kerja Sebenarpada tarikh PKLM dikemukakan.
(ii) Nombor dan tempoh lanjutan
Gerenti Bon Perlaksanaan, Gerentibayaran pendahuluan, polisi daninsurans CAR. Endorsement asaluntuk tiap-tiap polisi tersebuthendaklah disertakan bersama-sama PKLM ini.
boleh dimasukkan dalam sinopsissebab-sebab lanjutan masa yangdilampirkan bersama PKLM.
14 Tandatangan, Nama dan JawatanPegawai Penguasa
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
15 Tandatangan, Nama dan JawatanPegawai Yang DiberikuasaMenandatangani PKLM
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Jika berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 14
NON- COMPLETION
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Chapter 14 – NON-COMPLETION
Table of Contents
Table of Contents .....................................................................................................................14-i
List of Flowcharts .................................................................................................................... 14-ii
14.1 INTRODUCTION ............................................................................................................14-3
14.2 PROCEDURES................................................................................................................14-3
14.3 NON-COMPLETION........................................................................................................14-4
14.4 PREPARATION AND SUBMISSION OF CERTIFICATE OF NON-COMPLETION ......................14-5
14.5 REFERENCE DOCUMENTS ..............................................................................................14-5
14.6 REFERENCES.................................................................................................................14-6
APPENDIX 14A Checklist for the Preparation of Certificate of Non-Completion(Senarai Semakan Penyediaan Perakuan Kerja Tidak Siap…………….……………...14A-1
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Chapter 14 – NON-COMPLETION
List of Flowcharts
Flowchart Description Page
Flowchart 14.1 Delay 14-1
Flowchart 14.2 Non-Completion Procedure 14-2
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Chapter 14 – NON-COMPLETION
YES NO
YES
REFER TO CHAPTER 13 -DELAY AND EXTENSION TIME
Flowchart 14.1 – Delay
Delay become apparent; SOR issues warningletter to Contractor
Contractor to explain / issue letter explaining onreasons of delay
Acceptance
SOR to issue warning letter toContractor informing on his intention
to issue Certificate of Non-Completion and impose Liquidated
and Ascertained Damages
Reasons of delayare acceptable as
per contract?
Contractor to continue work and at thesame time SOR to prepare Certificate
of Non-Completion for the approvaland signature of Authorised Party
Prepare Certificate of Delay and Extensionof Time for approval and signature of
Authorised Party
NO
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Chapter 14 – NON-COMPLETION
Flowchart Description Action By Reference
1. Warning letter / notice tocontractor on issuance of Certificate of Non-Completion, and intentionto impose Liquidated and Ascertained Damages.
SOR
2. Prepare Certificate of Non-Completion
SOR
3. Verify the Certificate of Non-Completion forcompleteness andissuance is valid
CAO
4. Issue Certificate of Non-Completion and issueletter on intention toimpose LAD
SOR Refer : Form
JKR 203X
5. Impose LAD SOR
6. Inform Contractor onamount of deduction of LAD; if necessary
SOR
Flowchart 14.2 – Non-Completion Procedure
1
3
2
6
4
5
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Chapter 14 – NON-COMPLETION
14 NON-COMPLETION
14.1 INTRODUCTION
This chapter provides:
An overview of the non-completion provisions and procedure for works contracts
14.2 PROCEDURES
Please refer to Flowchart 14.1 – Delay and Flowchart 14.2 – Non-Completion Procedure.
Step Procedures / Tasks Action By
/ Reference
1 Warning letter / notice to contractor on issuance of Certificate
of Non-Completion (CNC) and LAD
To issue warning letter to Contractor that Certificate of Non-Completion will be issue due to the late completion, and thatLiquidated and Ascertained Damages will be imposed.
Action by: SOR
2 Prepare CNC
Ensure that the latest Form JKR 203X is used.
Complete the form, and make sure that all the particulars arecorrect. Refer Section 14.4
Action by: SOR
3 Verify the CNC
Before issuance of the CNC, CAO to check on thecompleteness and that the reasons for the issuance is valid.
Action by: CAO
4 Issue CNC
When Date for Completion is due and the Works has notreached practical completion, issue Certificate of Non-Completion to avoid time at large.
Ensure that all related Insurance Policies and PerformanceBond are submitted accordingly, and still valid.
Issue instruction to Contractor to extend the validity of theInsurance Policies and Performance Bond, if necessary.
Action by: SOR
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Chapter 14 – NON-COMPLETION
Step Procedures / Tasks Action By
/ Reference
5 Impose LAD
The Government shall impose LAD when Certificate of Non-Completion is issued.
Ensure that the LAD is deducted in the next Interim PaymentCertificate.
If there is insufficient payment due to the Contractor to coverthe amount of LAD, then consider recovering the LAD fromthe Performance Bond.
Consider whether there are sufficient grounds to determinethe employment of the Contractor. If yes, go the Chapter 16
– Determination.
Action by: SOR
6 Inform Contractor on amount of deduction of LAD
When LAD is imposed, then inform the Contractor in writingon the amount of deduction of LAD.
Action by: SOR
14.3 NON-COMPLETION
If the Contractor fails to complete the Works by the Date for Completion stated in the ContractDocument or within any extended time under Clause 43 (delay and extension of time), then the S.Oshall issue the Certificate of Non-Completion.
Due to the delay of completing the Works, the Contractor bears the loss or damage suffered by theGovernment. Government has the right to impose liquidated and ascertained damages. Liquidateddamages are intended to be the estimated damages that would be incurred as a result of delay tothe Works for which the Contractor is responsible.
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Chapter 14 – NON-COMPLETION
14.4 PREPARATION AND SUBMISSION OF CERTIFICATE OF NON-COMPLETION
Some basic rules must be complied with in the preparation of the Certificate of Non-Completion asfollows:-
a) All particulars in the Certificate must be correctly inserted. Particulars of the Contract andthe Contractor inserted in the Certificate must be the same as those in ContractDocument. No space allowed for insertions in the Certificate, except the date of thesame, shall be left blank. The date of the Certificate shall be the date on which theofficer empowered to do so signs the Certificate.
b) The periods of coverage of the insurance policies must be extended to the expected dateof completion of the Work.
When submitting the Certificate of Non-Completion for approval, particulars of the Contract andother information must be provided on a standard form. In addition, the following must be submittedtogether:-
a) A statement by the recommending officer as to whether he has studied thecircumstances of the case in depth and assessed the ability of the Contractor to proceedand complete the Work; and whether in his opinion, imposition of LAD will ensurecompletion of work the soonest and his reasons for thinking so.
b) A description of the progress of work achieved by the Contractor and the work programme of the balance of work may be completed.
c) Information whether there has been any cause of delay for which Government to beresponsible for and if so, whether a reasonable extension of time has been granted andwhether there is any foreseeable cause of delay for which the Government may be
responsible.
Only the officers empowered can approve the Certificate of Non-Completion. After approval, theoriginal copy must be sent to the Contractor by A.R Registered post. A copy of the CNC must also bedistributed to the parties listed for distribution in the Certificate.
14.5 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents mentioned in theprocedures or processes outlined in this Chapter.
Sample of Warning Letter
Form JKR 203X (Pin. 1/83) : Certificate of Non-Completion
Ringkasan Ke Atas Kontrak Yang Akan Dikeluar “Perakuan Kerja Tidak Siap”
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Chapter 14 – NON-COMPLETION
14.6 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on the administration of delays andissuance of certificate of non-completion.
Treasury Circular(Surat Pekeliling Perbendaharaan)
Nil
Treasury Instructions(Arahan Perbendaharaan)
Nil
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS.UB 1/1995: Perlantikan Pegawai Penguasa, Perwakilan Kuasa Pegawai Penguasa danPegawai-Pegawai Yang diberi Kuasa Dalam Urusan Pentadbiran Kontrak.
[2] SP JPS Bil. 1/2003: Perlantikan Pegawai Penguasa (P.P), Perwakilan Kuasa Pegawai Penguasa(Wakil P.P) Dan Pegawai-Pegawai Yang Diberi Kuasa (PYDK) Dalam Urusan Pentadbiran Kontrak.(Tambahan kepada Surat pekeliling SPJPS.UB 1/1995)
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 14 – Non- Completion
APPENDIX 14A
Checklist for the Preparation ofCertificate of Non-Completion
[Form JKR 203X]
(Senarai Semakan PenyediaanPerakuan Kerja Tidak Siap)
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Chapter 14 – NON-COMPLETION
APPENDIX 14A CHECKLIST FOR THE PREPARATION OF CERTIFICATE OF NON-COMPLETION (SENARAI SEMAKAN PENYEDIAAN PERAKUANKERJA TIDAK SIAP)
TAJUK
PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1 Notis untuk Mengenakan Ganti Rugi
Tandakan ()
selepassemakan
1.1 Sila pastikan surat-surat amaran telahdikeluarkan. Untuk surat amaranterakhir, sila pastikan format yangditetapkan digunakan.
2 Penyediaan dan MengemukakanPerakuan untuk Kelulusan
2.1 Pastikan borang yang digunakan adalahborang JKR 203X yang terkini.
2.2 Cara-cara pengisian borang, sila rujuk kepada perkara 5.
2.3 Pastikan semua polisi Insuran, BonPerlaksanaan serta Gerenti untuk bayaran Pendahuluan (sekiranyarecoupment belum habis dibuat) telahdilanjutkan oleh kontraktor. Sekiranyakontraktor gagal melanjutkan polisiInsuran, PMK hendaklah menguruskanpelanjutan (hendaklah ditolak daripadawang yang kena bayar kepada
kontraktor).
2.4 Perakuan Kerja Tidak Siap yang dimajukahendaklah dikepilkan bersama-samaborang ringkasan maklumat piawai.Maklumat- maklumat tambahan berikuthendaklah disertakan :
2.4.1 Huraian mengenai kemajuankerja yang telah dicapai olehkontraktor dan baki kerja yangakan dilaksanakan dan perkiraan
bila baki kerja tersebut bolehdilaksanakan
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BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
Penyediaan dan MengemukakanPerakuan untuk Kelulusan (Samb.)
2.4.2 Butir-butir bayaran interimkepada Kontraktor dan sebab-sebab sebarang kelambatanbayaran dan bayaran tidak dibuat.
3 Kuasa Untuk Meluluskan Perakuan
3.1 Pastikan Perakuan ini diluluskan olehPihak Berkuasa yang dinamakan dalamKontrak.
4 Cara-cara Pengisian Borang PerakuanTidak Siap Kerja
4.1 Kerajaan - Masukkan Malaysia bagiprojek Persekutuan dan Kerajaan Negeribagi Projek Negeri.
4.2 Rujukan - Isikan No. Rujukan Fail.
4.3 Pejabat - Pastikan alamat pejabatadalah alamat pejabat PegawaiPenguasa yang akan menandatanganiPerakuan ini.
4.4 Tarikh - Tarikh perakuan iniditandatangani oleh Pegawai Penguasa.
4.5 Kepada - Catitkan Nama dan Alamatkontraktor. Pastikan Nama dan Alamatkontraktor adalah sama seperti tercatitdalam dokumen kontrak.
4.6 Pastikan kelas pendaftaran Kontraktordengan PKK dicatitkan.
4.7 No. kontrak - Masukkan no. kontrak.Pastikan nombor kontrak adalah samaseperti tercatit dalam dokumen kontrak.
4.8 Kontrak Untuk - Masukkan tajuk kontrak dan pastikan ianya adalah sama sepertiyang tercatit dalam dokumen kontrak.
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Chapter 14 – NON-COMPLETION
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
Cara-cara Pengisian Borang PerakuanTidak Siap Kerja (Samb.)
4.9 Bahagian - Masukkan bahagian kerjasekiranya “Sectional Completion" adadiperuntukkan dalam kontrak.
4.10 Para 1
− Sila potong bahagian yang tidak berkenaan samaada kerja atausebahagian kerja-kerja.
− Masukkan tarikh siap sebenar atau
tarikh siap yang dilanjutkan yangsepatutnya kontraktor menyiapkanprojek tersebut.
4.11 Para 2
− Masukkan jumlah denda LAD bagisetiap hari seperti yang tercatitdalam dokumen Kontrak.
4.12 Tandatangan, Nama dan JawatanPegawai Peguasa.
4.13 Tandatangan, Nama dan JawatanPegawai Yang DiberikuasaMenandatangani Perakuan Tidak SiapKerja.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Audit Kualiti; Jika berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 15
LOSS AND EXPENSE
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Chapter 15 – LOSS AND EXPENSE
List of Flowcharts
Flowchart Description Page
Flowchart 15.1 Loss and Expense Procedure 15-1
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Chapter 15 – LOSS AND EXPENSE
Flowchart Description Action By Reference
1. Received notice and
estimates for loss andexpense
-
2. Is Contractor eligible forpayment of loss andexpense?
SOR
3. Inform Contractor of eligibility for loss andexpense. Request furtherinformation, if necessary.
SOR
4. Received details, andevaluate the informationsubmitted by theContractor
SOR
5. Prepare report and submitto Claim Secretariat
SO/SOR
6. Review and preparerecommendation by ClaimSecretariat
BUBK
7. Decision by ClaimsCommittee
ClaimsCommittee
8. Inform Contractor on theresult
SOR
9. Revise Contract Sum; if approved; if Final Accountis closed, revise Final Account
CAO Refer: Chapter 12 –
Adjustment of Contract Sum
Flowchart 15.1 – Loss and Expense Procedure
1
3
4
9
6
7
5
2
8
Yes
No
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Chapter 15 – LOSS AND EXPENSE
15 LOSS AND EXPENSE
15.1 INTRODUCTION
This chapter provides:
Overview of standard contract provisions and how to deal with Contractor’s claim
15.2 PROCEDURES
Please refer to Flowchart 15.1 – Loss and Expense Procedure.
Step Procedures / Tasks Action By
/ Reference
1 SO/SOR received notice and estimates for loss and expense
Contractor within one (1) month of the occurrence of event,give notice in writing to S.O his intention to claim supported byestimated amount.
The Contractor to submit details of his claim within 3 monthsafter the issuance of Certificate of Practical Completion.
2 Determine contractor’s eligibility for payment of loss andexpense
Carry out preliminary assessment of all claims, and establish if the loss and expense claim is valid
Action by: SOR
3 Inform Contractor of eligibility for loss and expense, andrequest for further information; if necessary
Inform Contractor in writing on eligibility and if documentssubstantiation is not sufficient, request for more supportingdocuments, supporting vouchers, explanation and calculation.
Action by: SOR
4 Received details and evaluate the information submitted by theContractor
The SOR shall forthwith evaluate all information submitted bythe Contractor.
The SOR shall finalise all claims to meet the deadline forcompleting Final Account, which is no later than three (3)months after end of Defects Liability Period.
Action by: SOR
5 Prepare report and submit to Claim Secretariat
After assessment and evaluation, prepare report of evaluationcomplete with eligible amount for approval of the SO.
Submit the report to the Claim Secretariat at BUBK.
Action by: SO/SOR
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Chapter 15 – LOSS AND EXPENSE
Step Procedures / Tasks Action By
/ Reference
6 Review and prepare recommendation
Claim Secretariat to assess report prepared by SO/SOR andprepare recommendation to Claims Committee.
Action by: BUBK
7 Decision by Claim Committee
After reviewing report and recommendation; make decision.
Action by: ClaimsCommittee
8 Inform Contractor on the result
After determining the eligible amount claimable for loss and/orexpense and after receive approval, inform Contractor inwriting.
If not eligible, inform Contractor in writing.
Action by: SOR
9 Revise Contract Sum; if approved
Adjust Contract Sum when claim for loss and/or expense isapproved.
Prepare Final Account, based on the adjusted Contract Sum.
If Final Account has been prepared, closed and approved priorto the settlement of claims, then revise the Final Accountaccordingly.
Action by: CAO
Refer Chapter 12 – Adjustment of
Contract Sum
15.3 LOSS AND EXPENSE PROVISIONS IN JKR203 & JKR203A CONDITIONS OF
CONTRACT
The three (3) relevant clauses related to direct loss and/or expense are Clause 5(d), Clause 44 andClause 48.
Clause 5(d) deals with S.O Instruction; Clause 44 deals with Loss and Expense caused by Delayswhilst Clause 48 deals with Final Certificate.
The Contract Conditions has the following provisions/requirements:-
Contractor shall within one (1) months of the occurrence of the event, give notice in writingto S.O of his intention to claim supported by an estimate of the amount of loss and/orexpense likely to be incurred
Within three (3) months after Practical Completion, the Contractor shall submit fullparticulars of all claims together with any documents, supporting vouchers, explanations andcalculations
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Chapter 15 – LOSS AND EXPENSE
The grounds for direct loss and/or expense (under Form JKR 203/203A) are limited under todisruption of regular progress of the works or any part thereof by reasons of:-
(i) Directions given by S.O consequential upon disputes with neighboring owners not due toneglect or default of the Contractor of his Sub-Contractors [Clause 48 and Clause 43 (c)]
(ii) Contractor not receiving in due time necessary instructions and information due tonegligence or default of the S.O [Clause 48 and Clause 43 (f)]
(iii) Delay on the part of artists, tradesmen or others engaged by the government for work not forming part of the Contract [Clause 48 and Clause 43(i)]
15.4 RELATIONSHIP BETWEEN LOSS AND/OR EXPENSE AND EXTENSION OF TIME
Many Contractors upon being granted and Extension of Time (EOT) presume that they can claim alladditional costs for the extended period as loss and/or expense.
The granting of EOT does not give an automatic right to loss and/or expense.
EOT and loss and/or expense are separate and must be dealt with independent of each other and ontheir own merits.
Only by examining cause and effect can items of costs, which fall under loss and/or expense, beidentified. If the delay was the responsibility solely of the Contractor, Contractor should not cover hisadditional costs arising from any delay of the building works by claiming Loss and Expense. If delayis due to natural factors, than loss and/or expense is not claimable.
15.5 TYPICAL HEAD CLAIMS AND WHEN THEY ARE JUSTIFIED
“Heads” of claim for Loss and/or Expense may include:-
(a) Additional Site Overheads
Sometimes been referred to extended preliminaries. Should be based on actual additionalcosts incurred by the Contractor resulting from an event or circumstances, which brought todisruption to the regular progress of the works. The actual cost could either be higher orlower than the priced Preliminaries in the Contract Sum. The priced Preliminaries serves as aguide in assessment of loss and/or expense as to expenditure that the Contractor wouldexpend had there been no disruption.
The actual cost should not deviate too far from contract pricing and should it happen, thencheck carefully that the Contractor has not “loaded” his costs which he had incurred as a
result of his own delays or poor management.
(b) Cost of uneconomic working (loss of productivity)
This refers to Contractor’s loss of output or productivity due to disruption of the regularprogress of the works, and includes idling costs. Contractor need to produce detailed recordsbecause the Contractor may generally be inefficient or he may have carried out work incorrectly.
Contractor needs to demonstrate that he has taken measures to mitigate the loss.
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Chapter 15 – LOSS AND EXPENSE
15.6 ESTABLISHING IF A LOSS AND EXPENSE CLAIM IS VALID
The basic grounds to deal with a loss and expense claim are as follows:-
(a) The claim is in accordance with the relevant clauses of the Conditions of
Contract.
(b) In line with the above, all notices and claims must be submitted in writing.
(c) The SOR shall assess all claims for loss and/or expense as soon as sufficientinformation is available.
(d) It must be an expense not recoverable elsewhere under the contract.
Assess the claim for loss and/or expense as follows:
(a) Expenses claimed are actual expenses which are supported by documentation.
(b) Loss can be proven through documentary proof and records.
(c) Contractor has shown that the loss and/or expense are direct consequence(s) of the delay/disruption (cause-and-effect).
15.7 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents mentioned in theprocedures or processes outlined in this Chapter.
15.8 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on claims for loss and expense.
Treasury Circular(Surat Pekeliling Perbendaharaan)
Nil
Treasury Instructions(Arahan Perbendaharaan)
[1] AP 202: Arahan Perubahan Kerja
DID Circulars(Surat Pekeliling / Edaran JPS)
Nil
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 15 – Loss and Expense
APPENDIX 15A
Checklist for the Assessment ofContractor’s Claim and Preparation of
S.O./P.D. Report
(Senarai Semakan PenyediaanPenilaian Tuntutan Kontraktor dan Laporan
Pegawai Penguasa)
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Chapter 15 – LOSS AND EXPENSE
APPENDIX 15A CHECKLIST FOR THE ASSESSMENT OF CONTRACTOR’S CLAIM AND PREPARATION OF S.O./P.D. REPORT (SENARAI SEMAKANPENYEDIAAN PENILAIAN TUNTUTAN KONTRAKTOR DANLAPORAN PEGAWAI PENGUASA)
TAJUK PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1.0 AM
1.1 Fahami asas tuntutan dan tentukansinopsis peristiwa yang menyebabkantuntutan oleh Kontraktor.
1.2 Tentukan tuntutan layak dipertimbangkan untuk dibawa ke J/K Tuntutan antaranya seperti berikut :
(a) Asas tuntutan adalah dibenarkan diBawah Kontrak seperti A.P 202Jadual III (e) iaitu:
Kerugian dan perbelanjaandisebabkan oleh kelambatanKerajaan dan/atau mematuhi ArahanPP atau kerana mematuhi keperluanBerkanun
Percanggahan dalam atau antaraDokumen-dokumen kontrak
Tuntutan lain yang nyatanyadibenarkan dalam Syarat-syaratKontrak seperti :o Fasal 43 (c), (f) & (i) Borang JKR
203/203A
Apa-apa kos yang ditanggungberhubung dengan fee & cajpemindahan pembentungan, bekalanair, bekalan elektrik dan lain-lainyang berkaitan
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Chapter 15 – LOSS AND EXPENSE
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1.0(Samb.)
AM (Samb.)
(b) Tuntutan kontraktor yang berpunca
dari pecah kontrak atau kegagalanKerajaan atau PP yangmenyebabkan pelaksanaan KerjaKontraktor terhalang atau terlewat.
(c) Kontraktor telah melaksanakanobligasi tambahan yang tidakberbentuk fizikal kekal (sepertiitem-item awalan, kerjasementara, penggunaan loji,peralatan termasuk peranca &acuan, perubahan masa / tempohpenyiapan dan lain- lain.)
(d) Kontraktor telah mengeluarkanperbelanjaan tambahan ataumenanggung kerugian secaralangsung yang tidak akan digantibayar melalui pembayaran yangdibuat di bawah mana-manaperuntukan lain dalam kontrak.
2.0 PENILAIAN TUNTUTAN KONTRAKTOR
2.1 Tentukan samaada kontraktor telahmematuhi semua prosedur dan syarat-syarat kontrak yang melayakkantuntutannya dipertimbangkan ;
(a) Kontraktor telah memberi notis yang jelas (menyatakan perkara yangdituntut berserta dengan anggarantentang amaun yang dituntut)menyatakan niatnya untuk membuat
tuntutan dan diberi kepada PP dalamtempoh yang disyaratkan dalamkontrak, dan
b) Kontraktor telah mengemukakanbutiran terperinci, lengkap dengandokumen sokongan bagimembuktikan tuntutannya dalamtempoh yang disyaratkan dalamkontrak.
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Chapter 15 – LOSS AND EXPENSE
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
2.0(Samb.)
PENILAIAN TUNTUTAN KONTRAKTOR (Samb.)
2.2 Dapatkan maklumat tambahan yangberkenaan yang telah disahkan olehPP / Wakil PP seperti;
Surat-menyurat yang berkaitandan/atau
Minit mesyuarat, buku harian tapak dan/atau
Sijil-sijil dalam kontrak yangberkaitan seperti lanjutan masa dll.,dan
Dokumen Kontrak
2.3 Syor sama ada memperaku / menolaktuntutan dari kontraktor disediakanberdasarkan;
(a) Fakta-fakta kes mengikut rekodseperti item 2.2 di atas danmengikut pengetahuan PP dalammengawasi projek, dan
(b) Peruntukan-peruntukan yangberkaitan dalam kontrak.
2.4 Tentukan kuantum bayaran (jika didapatiwajar dibayar) kepada kontraktor ;
(a) Perkara yang diambilkira sebagaiitem yang layak dituntut adalahteratur.
(b) Tempoh yang layak diambilkira (bagituntutan yang berkaitan dengantempoh masa) oleh kontraktor
adalah teratur.
(c) Dokumen-dokumen yangmenyokong tuntutan serta bukti-bukti kerugian yang ditanggung danperbelanjaan tambahan sebenaryang telah dikeluarkan olehkontraktor adalah teratur. (Dokumenhendaklah yang asal atau diakui saholeh PP / Wakil PP)
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 16
DETERMINATION
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Chapter 16 – DETERMINATION
Table of Contents
Table of Contents .....................................................................................................................16-i
List of Flowcharts .................................................................................................................... 16-ii
16.1 INTRODUCTION.........................................................................................................16-3
16.2 GENERALLY ...............................................................................................................16-3
16.3 PROCEDURES ............................................................................................................16-3
16.3.1 Determination................................................................................................16-3
16.3.2 Settlement Of The Final Account.....................................................................16-7
16.4 NOTICES ...................................................................................................................16-8
16.4.1 Notice for Intention to Notice Determine the Contractor’s Employment..............16-8
16.4.2 Notice for Determination ................................................................................16-8
16.5 FINAL ACCOUNT ........................................................................................................16-9
16.6 RE-TENDER ...............................................................................................................16-9
16.7 REFERENCE DOCUMENTS...........................................................................................16-9
16.8 REFERENCES .............................................................................................................16-9
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Chapter 16 – DETERMINATION
List of Flowcharts
Flowchart Description Page
Flowchart 16.1 Determination of the Employment of the Contractor 16-1
Flowchart 16.2 Settlement of Final Account 16-2
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Chapter 16 – DETERMINATION
Flowchart Description Action By Reference
1. Establish the ground(s) forthe determination
SOR
2. Issue 1st warning letter SOR
3. Contractor continuesdefault or repeats thedefault?
4. Issue 2nd warning letter SOR
5. Prepare report fordetermination, and submitto JKPPS for approval
SOR Refer SPP 5/2006
6. SO to issue ‘NotisKemungkiran Kontraktor’
SOR
7. Contractor continuesdefault or repeats the
default?
8. Officer Named in Contractto issue Notice of Determination
SOR/ OfficerNamed inContract
9. Forfeit Performance Bondor Advance Payment Bond
SOR/CAO
10. Issue stop work order andevaluate the works done
SOR Ref: Sample of
Sch. of Activities prior
to Tender
11. R e-tendering exercise CAO See Chapter
6 – 8
12. Settlement of Final Account
See Flowchart 16.2
Note: For bankruptcy or insolvency, SOR may go straight to step 8 – 12
Flowchart 16.1 – Determination of the Employment of the Contractor
No
1
2
4
5
7
3
End
6
8
9
Yes
Yes
No
10
11
12
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Chapter 16 – DETERMINATION
Flowchart
Description Action By Reference
1. Establish the completioncost.
CAO
2. Prepare and issue Final Account
CAO
3. Amount due toGovernment?
CAO
4. Payment to Contractor CAO
5. Issue claim to Contractorby AR Register
SOR
6. Contractor pays?
7. Issue 1st Reminder (within2 weeks)
SOR
8. Contractor fails to pay?
9. Issue 2n Reminder (within2 weeks)
SOR
10. Contractor fails to pay?
11. Issue 3rd Reminder (within2 weeks)
SOR
12. Refer matter to the Legal Adviser at Ministry level / A.G.’s Chamber
BUBK
Flowchart 16.2 – Settlement of Final Account
Yes
Yes
1
2
5
3
12
No
No
Yes
4
9
10
8
7
6
Yes
No
No
End 11
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Chapter 16 – DETERMINATION
16 DETERMINATION
16.1 INTRODUCTION
This chapter provides:
To outline the overall procedures on determination of the Contractor.
16.2 GENERALLY
The determination and the subsequent procedures shall be done in accordance with the proceduresset out in the Contract.
Generally, the whole process can be divided into 2 distinct steps:
(i) Determination of the employment of the contractor.
(ii) Settlement of the Final Account of the original contract.
16.3 PROCEDURES
16.3.1 Determination
Step Procedures / Tasks Action By
/ Reference
(Please refer to Flowchart 16.1 – Determination of theEmployment of the Contractor)
Generally
The progress of and works programme submitted by theContractor may reveal the Contractor’s capability orincapability to complete the works on time.
The Conditions of Contract provides the rights of theGovernment to determine the employment of Contractor fordefaults.
For information
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Chapter 16 – DETERMINATION
Step Procedures / Tasks Action By
/ Reference
1 Establish the Grounds for Determination
Establish / Verify the grounds for the determination:
(a) The Contractor fails to submit Performance Bond orInsurance Policies
(b) The Contractor fails to expedite the works afterreceiving Letter of Acceptance
(c) Any of the ground stated in Conditions of Contract,such as
Suspending the carrying out of works without
reasonable cause Not carrying out the works diligently Failing to execute the works in accordance with the
contract or neglecting to carrying out his obligationunder the Contract
Subletting the whole or any part of the works withoutprior consent of S.O./PD
Contractor went to insolvency, winding up orliquidation
Insolvency of Contractor
If the Contractor becomes insolvent or bankrupt, issue the
Notice of Determination; no warning letter(s) is required.
Action By:SOR
2 Prepare 1st Warning Letter
Upon established the ground for determination, theintention for determination via a warning letter is issuedwith a reason to stop the employment. A time frame,normally fourteen (14) days is given to Contractor forreaction.
Refer to Sample of Warning Letter.
Action By:SOR
3 & 4 Contractor Continues/ Repeats Defaults?Prepare 2nd Warning Letter
If no compliance made by the Contractor, the 2nd warningshall be issued.
If the Contractor repeats and fail to comply the reminder(within fourteen days), the proposal /report shall be madeby PM/ CA to Authorised Officer to stop the employment.
Action By:SOR
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Chapter 16 – DETERMINATION
Step Procedures / Tasks Action By
/ Reference
5 & 6 Prepare Report and Issue the ‘Notis KemungkiranKontraktor’
(a) Prepare a report on the determination, and submit toJawatan Kuasa Penyelamat Projek Sakit (JKPPS) forapproval.
Other than the recommendation, the report shallinclude the short listed tenderers for execution thedefect works and the recommend the appropriateprocurement option.
If the report is complete and deemed satisfactory bythe Authorised Officer, the SO shall issue a notice of
non-performance (Notis Kemungkiran Kontraktor). A period of fourteen days is given to Contractor to takethe necessary action.
(b) The SO shall report to Authorised Officer on the action(or inaction) of the Contractor prior the issuance of Notice of Determination.
Refer to Sample of ‘Notis Kemungkiran Kontraktor’.
** if the Contractor is in default under Fasal 51(b)Syarat- Syarat Kontrak (Bankruptcy or insolvency), the SOmay submit the report without issuing any warning lettersor default notice.
Action By:SOR
7 & 8 Contractor Continues/ Repeats Defaults?Issuance of Determination Notice
If the Contractor does not comply with the warning letter ordefault notice, or if the Contractor repeats and fail tocomply the reminder (within fourteen days), issue theDetermination Notice.
Refer Section 16.6.2 - Notice for Determination
Action By:SOR/ Officer Named in
Contract
9 Forfeit Performance Bond or Advance Payment Bond
To forfeit Performance Bond and/or Advance Payment Bondof the Contractor immediately after issuance of Notice of Determination.
Refer to Sample of Letter for Calling off Performance Bond
Action By:SOR / CAO
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Chapter 16 – DETERMINATION
Step Procedures / Tasks Action By
/ Reference
10 Issuance of Stop Work Order and Evaluate Works Done
If the Contractor fails to evacuate from the site, issue aStop Work Order.
Evaluate the works done, including computing the value of works done (for finalisation of accounts purposes) andschedule of defects and out-standing works.
Action By:SOR
Refer: Sample of Sch.
Of Activities prior to
Tender
11 Re- tendering Exercise
Refer to Chapter 6 to 8.
Action By:CAO
12 Settlement of Final Account
Refer to Flowchart and Procedures of Settlement of Final Account.
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Chapter 16 – DETERMINATION
16.3.2 Settlement Of The Final Account
Step Procedures / Tasks Action By
/ Reference
(Please refer to Flowchart 16.2 – Settlement of Final Account)
1 Establish Completion Cost
Prepare the estimate on the Completion Cost (comprising of loss by Government and new contract sum by newcontractor).
Action By:CAO
2, 3 & 4 Prepare and Issue Settlement of Final Account
Prepare the Settlement of Final Account for the newContractor. Costs comprise of:
(a) Interim Payments(b) Advance Payment(c) Payments to subcontractors and suppliers(d) New Contract Sum(e) Cost for re- tender(f) Loss to Government(g) On- Cost Charge(h) Finalised Contract Sum
Establish the Final Amount due to Contractor orGovernment, as the case may be.
Ensure that all deductions are incorporated into the Final Account. Include the amounts of the forfeited PerformanceBond.
Pay the Contractor if any final amount is due to him.
Action By:CAO
5 Issuance of Claim to Contractor (By A.R. Register)
If under the Final Account an amount is due to Government,send the Final Account and claim for payment (‘claim’) tothe Contractor by A.R. Registered post as soon as ispracticable, preferably within 9 months after determination.
Action By:SOR
Refer: SP JPS Bil 1/1990
6 & 7 Issuance of 1st Reminder
Issue 1st reminder if Contractor fails to pay, or no action istaken by Contractor, within 14 days of issuance of claim.
Action By:SOR
8 & 9 Issuance of 2nd Reminder
Issue 2nd reminder if Contractor fails to pay, or no action istaken by Contractor, within 14 days after the issuance of 1 st
reminder.
Action By:SOR
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Chapter 16 – DETERMINATION
Step Procedures / Tasks Action By
/ Reference
10 & 11 Issuance of 3rd Reminder
Issue 3rd reminder if Contractor fails to pay, or no action istaken by Contractor, within 14 days after the issuance of 2 nd
reminder.
Action by:SOR
12 Refer to Legal Adviser at Ministry level/ A.G.’s Chamber
Seeks advice by Legal Advisor (of Ministry or State) if still noaction taken by Contractor.
Action by:BUBK
16.4 NOTICES
16.4.1 Notice for Intention to Notice Determine the Contractor’s Employment
To state clearly the contract no, job title, contract sum contract period, date of possession,completion date and extended completion date, if any.
To state clearly the reason of determination by the Contractor’s default.
To highlight the percentage of works done and aims for completion according to original orrevised works programme.
To state the date and duration by the Contractor suspended the works.
To highlight whether the contractor consistently repeats the default (not for 1st warning) togetherwith all references for previous notices such as serials meetings, date, officers in charged, etc.
To state the assistance given to contractor in form of materials procurements and grantedextension of time
To state the date or last extended date for completion together with method statements worksprogramme.
The notice must be copied to all relevant parties including PKK or bank/ insurance company.
16.4.2 Notice for Determination
To state clearly the contract no, job title, contract sum contract period, date of possession,
completion date and extended completion date, if any.
To state the reference and date of Notice for Intention the Determine the Contractor’sEmployment
To state whether the Contractor is continuing the defaults
If the Contractor replied a notice, to highlight to them the reasons are not accepted.
The notice must be copied to all relevant parties including the registrar of the Contractor andbank/ insurance company.
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Chapter 16 – DETERMINATION
16.5 FINAL ACCOUNT
To include the Completion Cost which comprises the advance payment, interim payments,payments to sub-contractors, suppliers, new contract price, re- tender cost, loss to Governmentand charge on cost.
To include the Revised Contract Sum which includes deduction for loss, damages and expense.
16.6 RE-TENDER
Evaluate the executed works and check the balance of works to avoid disputes for BQ contracts.
To allow credit for plants, tools, equipment and unfixed materials left on site for use of newcontractor.
Any other above this to refer to Chapter 6 to 8.
16.7 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents for the procedures orprocesses outlined in this Chapter.
Sample of Warning Letter (‘Notis Kemungkiran Kontraktor’)
Sample of Notice for Determination (‘Penamatan Pengambilan Kerja Kontraktor’)
Sample of Schedule Activities (Bar Charts for Preparation of Tender Invitation)
Sample of Settlement of Final Account Upon Determination
Sample of Letter for Calling off Performance Bond and Advance Payment Bond
Sample of Calculation of Loss by Government
16.8 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars for the latest procedures andprocesses in respect of determination of the employment of the contractor.
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] SPP 5/2006: Peraturan Pelantikan Kontraktor Penyiap bagi Projek Sakit
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS. Bil. 1/1990: Perakuan Penamatan Pengambilan Kerja Kontraktor Berasaskan BorangKontrak 203 & 203A
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 17
COMPLETION
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Chapter 17 – COMPLETION
Table of Contents
Table of Contents .....................................................................................................................17-i
List of Flowcharts .................................................................................................................... 17-ii
17.1 INTRODUCTION ............................................................................................................17-2
17.2 PROCEDURES................................................................................................................17-2
17.3 COMPLETION ................................................................................................................17-3
17.4 PRACTICAL COMPLETION ..............................................................................................17-3
17.5 SECTIONAL COMPLETION..............................................................................................17-4
17.6 PARTIAL OCCUPATION ..................................................................................................17-4
17.7 HANDING OVER ............................................................................................................17-4
17.8 SUBMISSION AND REQUIREMENTS NECESSARY FOR COMPLETION .................................17-5
17.9 REFERENCE DOCUMENTS ..............................................................................................17-5
APPENDIX 17A Checklist for the Preparation of Certificate of Practical Completion(Senarai Semakan Penyediaan Perakuan Siap Kerja) …………………………………..17A-1
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Chapter 17 – COMPLETION
List of Flowcharts
Flowchart Description Page
Flowchart 17.1 Completion 17-1
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Chapter 17 – COMPLETION
Flowchart Description Action By Reference
1. Receipt of notice fromContractor -
2. Final Inspection. PT
3. Works (or Section) ispractically completed forall purposes of theContract?
-
4. Issue instruction to rectifydefective works, if any
SOR
5. Issue Certificate of Practical Completion andHand over the Works toClient-Agency
SOR
6. Release of 50% of Performance Bond
SOR/CAO Refer Chapter
10 - Payment
Flowchart 17.1 – Completion
1
2
3
6
4
5
No
Yes
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Chapter 17 – COMPLETION
17 COMPLETION
17.1 INTRODUCTION
This chapter provides:
An overview of the completion provisions and procedure for works contracts The standard forms of contract use for DID projects
17.2 PROCEDURES
Please refer to Flowchart 17.1 – Completion.
Step Procedures / Tasks Action By
/ Reference
1 Receipt of notice from Contractor
Contractor issue notice that the Works are all practicallycompleted and ready for Final Inspection
2 Final Inspection
Carry out Final Inspection especially mechanical and electricalinstallation works to determine Works are practically completed
Action by:PT
3 Works (or Section) is practically completed for all purposes of the Contract
Practically completed meaning, the Contractor has performedand completed all the necessary Works specified in theContract and the patent defect existing are minor
4 Issue Instruction to rectify defective works; if any
If necessary; issue instruction to rectify defective works thatcan effect the issuance of Certificate of Practical Completion
Action by:SOR
5 Issue Certificate of Practical Completion and Hand over theWorks to Client-Agency
If two (2) is acceptable, than issue Certificate of Practical
Completion and thus the Works are handed over to the Client- Agency.
Action by:SOR
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Chapter 17 – COMPLETION
When CPC is issued; then 50% of the Performance Bond can be released to the Contractor and inturn Contractor to issue new Performance Bond guaranteeing the remaining sums. If PerformanceGuarantee Sum is used, then 50% of the sum may be released to the Contractor upon issuance of the CPC.
17.5 SECTIONAL COMPLETION
The Conditions of Contract contains provisions, which allows the Government to require the Works tobe completed in sections or parts. Where this is required, the sections or parts must be identified andthe measure of Liquidated and Ascertained Damages for each must be specified in the tender andcontract documents.
Where sectional completion of the Works is specified, the provision of the Contract as regards theCertificate of Practical Completion, Delay and Extension of Time, Liquidated and AscertainedDamages and the Defects of Liability Period apply as if each section or part is the subject of aseparate and distinct contract between the Government and the Contractor.
17.6 PARTIAL OCCUPATION
Prior to the practical completion of the whole Works, the Government may but with the consent of Contractor, take possession of and occupy any part of the completed Works.
Where any part of the Works is taken possession of and occupied by the Government prior tocompletion of the whole of the Works, the following apply:-
a) A Certificate of Partial Occupation must be issued within seven (7) days of the takingpossession and occupation of the part of the Works. The Certificate must state theestimated value of the part of the Works taken possession of and occupied.
b) The Defects Liability Period for the part of the Works taken possession of and occupiedcommences on the date the Government takes possession of and occupies the same.
c) The Liquidated and Ascertained Damages specified in the Contract is reduced in theproportions which the value of the part taken possession of and occupied bears to theContract Sum.
d) The provisions of the Contract as regards of insurance and release of the PerformanceBond are not affected.
17.7 HANDING OVER
Upon the issue of the Certificate of Practical Completion, the Government takes over the Works and
the Contractor cease to be responsible for loss and/or damage to the same other than loss and/ordamage caused by or arising from defective work.
For the purpose of handing over the Works to the Government, a joint inspection of the Works mustbe held and the keys to the Works handed over.
The Government must also be advised of the operation and maintenance requirements of the Worksincluding those relating to mechanical and electrical installations.
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Chapter 17 – COMPLETION
17.8 SUBMISSION AND REQUIREMENTS NECESSARY FOR COMPLETION
Notes : Please refer to the DID Manual Volume 11 - Construction Management, Chapter 17
17.9 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents for the procedures orprocesses outlined in this Chapter.
JKR 203S : Certificate of Practical Completion JKR 203W : Certificate of Partial Occupation Perakuan Serahan Kerja Siap Perakuan Serahan Kerja Siap Berbahagian
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 17 – Completion
APPENDIX 17A
Checklist for the Preparation ofCertificate of Practical Completion
[Form JKR 203S]
(Senarai Semakan PenyediaanPerakuan Siap Kerja)
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Chapter 17 – COMPLETION
APPENDIX 17A CHECKLIST FOR THE PREPARATION OF CERTIFICATE OFPRACTICAL COMPLETION (SENARAI SEMAKAN PENYEDIAANPERAKUAN SIAP KERJA)
TAJUK PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterima
Oleh
Tarikh SiapSemakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
1. Borang Perakuan Siap Kerja Tandakan ()selepassemakan
Borang yang digunakan ialah borangJKR203S yang terkini.
Muka Depan
2. KERAJAAN – bermaksud 'KERAJAANMALAYSIA' bagi projek Persekutuan atau'KERAJAAN ............ ’ bagi projek Negeri.
3. Rujukan - masukkan no. fail projek Pegawai Penguasa.
4. Pejabat - masukkan Pejabat PegawaiPenguasa atau Wakil Pegawai Penguasa.
5. Tarikh - iaitu tarikh ditandatangani olehPegawai Penguasa atau Wakil PP.
6. Kepada - Nama dan alamat Kontraktorhendaklah sama seperti dalam dokumenkontrak.
7. Kelas - mengikut kelas lesen pendaftaran
kontraktor dalam dokumen kontrak.
8. Kontrak No. - hendaklah sama denganyang terdapat dalam dokumen kontrak.
9. Kontrak Untuk - Nama projek samaseperti di dalam dokumen kontrak.
10. Pastikan samada kerja tersebut siapsebahagian atau keseluruhan danpotong yang tidak berkenaan.
11. Siap pada - Nyatakan tarikh siap sebenar.
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Chapter 17 – COMPLETION
BIL. KETERANGAN PMK1 PMK2 AK* ULASAN
12. Ambil milik pada - pastikan sehari selepastarikh siap.
13. Tempoh Tanggungan Kecacatan pada -sama dengan tarikh siap kerja sehinggatamat tempoh tanggung kecacatanseperti yang dinyatakan dalam dokumenkontrak.
14. Tempoh berakhir – 6/12/24* bulan daritarikh di atas. *Yang mana berkenaan,mengikut tempoh yang tercatat di dalamLampiran Kepada Syarat-syarat Kontrak.
15. Tandatangan Pegawai Penguasa / Wakil
PP projek berkenaan mengikut kontrak.
16. Nama Penuh dan Jawatan - PegawaiPenguasa / Wakil PP yang berkenaan.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Jika berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 18
DEFECTS MANAGEMENT
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Chapter 18 – DEFECTS MANAGEMENT
Table of Contents
Table of Contents .......................................................................................................................18-i
List of Flowcharts ...................................................................................................................... 18-ii
18.1 INTRODUCTION ..............................................................................................................18-3
18.2 PROCEDURES..................................................................................................................18-3
18.2.1 Defects Management During Defect Liability Period............................................18-3
18.2.2 Defects Management at End of Defect Liability Period ........................................18-4
18.3 REFERENCE DOCUMENTS ................................................................................................18-5
18.4 REFERENCES...................................................................................................................18-5
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Chapter 18 – DEFECTS MANAGEMENT
List of Flowcharts
Flowchart Description Page
Flowchart 18.1 Defects Management During Defect Liability Period 18-1
Flowchart 18.2 Defects Management at End of Defect Liability Period 18-2
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Chapter 18 – DEFECTS MANAGEMENT
Flowchart Description Action By Reference
1. Receive report fromend-user andestablish defects
SOR
2. Issue SO’s Instructionto rectify defects
SOR/SO
3. Contractor compliesto instruction?
4. If Contractor fails tocomply, appoint thirdparty to rectifydefective works
SOR
5. Deduct from moneydue to Contractor, orfrom PerformanceBond / PerformanceGuarantee Sum
SOR/ CAO
Flowchart 18.1 – Defects Management During Defect Liability Period
1
2
No3
4
Yes
5
End
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Chapter 18 – DEFECTS MANAGEMENT
Flowchart Description Action By Reference
1. Joint inspection towards endof DLP
SOR
2. Further defects?
3. Identify further defects andissue Schedule of Defects(within 14 days of expiry of DLP)
SOR
4. Instruct Contractor to makegood (make good not laterthan 3 months from issuanceof Schedule of Defects)
SOR
5. Joint re-inspection (on expiryof time given to make goodor upon expiry of 3 monthswhichever is earlier)
SOR
6. Further defects? -
7. Issue Certificate of MakingGood Defects
SOR
8. Issue of FinalCertificate
SOR Refer Chapter
19
Flowchart 18.2 – Defects Management at End of Defect Liability Period
Yes
1
3
No
4
7
2
5
6
8
No Yes
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Chapter 18 – DEFECTS MANAGEMENT
18 DEFECTS MANAGEMENT
18.1 INTRODUCTION
This chapter provides:
the overall procedures in management of defects throughout and end of the Defects LiabilityPeriod until the issuance of the Final Certificate
18.2 PROCEDURES
18.2.1 Defects Management During Defect Liability Period
Please refer to Flowchart 18.1 – Defects Management During Defect Liability Period.
Step Procedures / Tasks
Action By
/ Reference
1 Receive Report and Establish Defects
End-user (e.g. Client-agency, DID officers or members of thepublic using the Works) to report immediately to SOR, and SOR shall determine if defects had occurred.
Action By:SOR
2 SO’s Instruction to Rectify Defects
SOR shall immediately issue instruction to the Contractor torectify the defects, with a fair and reasonable time frame tocomplete the making good of defects.
SOR may issue instructions to rectify defects as many times asnecessary during the Defects Liability Period.
Action By:SOR
3 & 4 Contractor complies Instruction; Appoint Third Party to Rectify Defects
If the Contractor refuses or fails to make good the defectswithin the time stipulated in the SO Instruction or withinreasonable time if none is stated, then the SO may appointthird party to rectify the defective works.
Action By:SOR
5 Deduct Monies Due to Contractor
If third party executed the defect works, the cost incurred inmaking good defects due to the failure of the contractor mustbe recovered from Contractor:
From monies due or payable to Contractor or As deduction of Performance Bond or Performance
Guarantee Sum (Wang Jaminan Pelaksanaan).
Action By:SOR/ CAO
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Chapter 18 – DEFECTS MANAGEMENT
18.2.2 Defects Management at End of Defect Liability Period
Please refer to Flowchart 18.2 – Defects Management at End of Defect Liability Period.
Step Procedures / Tasks Action By
/ Reference
1 Joint Inspection towards end of Defects Liability Period
To carry out joint inspection together with SOR, ClientDepartment/ Ministry, Contractor and other parties involved.
Action By:SOR
2 & 3 Identify any Further Defects, Issuance of Schedule of Defects
If there are defects at the end of Defects Liability Period,prepare the Schedule of Defects and issue it to the Contractorwithin 14 days after the expiry of DLP.
Action By:SOR
4 Instruction to Rectify the Defects
Issue the instruction to rectify all defect works completelywithin a reasonable time.
Ensure the duration given to the contractor must not exceed 3months from the date of issuance the Schedule of Defects.
Action By:SOR
5 Joint Re-Inspection
To carry out the joint re-inspection with the SOR andrepresentatives from Client Department/ Ministry, Contractorand other parties involved on the date of the expiry of rectification period given to Contractor or upon the expiry of
period of 3 months, whichever is the earlier.
Action By:SOR
6 & 7 Issuance of Certificate of Completion of Making Good Defects(CMGD)
Issue the certificate of completion of making good defects if there are no further defects.
Ensure the date in such certificate is the date of Contractorcompleted the rectification of defective works.
Ensure the copies to be distributed to: Contractor (original)
Other parties named in certificate (copies)Return the Performance Bond / Performance Guarantee Sumto the Contractor.
Action by:SOR
8 Issue Final CertificatePrepare the Final Certificate upon the issuance of CMGD.
Action by:SOR/CAO
Refer to Chapter 19 – Final Account and
Final Certificate.
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Chapter 18 – DEFECTS MANAGEMENT
18.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents for the procedures orprocesses outlined in this Chapter.
Form JKR 203Y (Pin.2/2001) : Perakuan Siap Memperbaiki Kecacatan
18.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars defects management.
Treasury Circular(Surat Pekeliling Perbendaharaan)
Nil
Treasury Instructions
(Arahan Perbendaharaan)
[1] AP 200.4 & 200.5: Tempoh Tanggungan Kecacatan
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SPJPS. Bil. 1/2003: Perlantikan Pegawai Penguasa (P.P.), Perwakilan Kuasa Pegawai Penguasa(Wakil P.P.) Dan Pegawai-pegawai Yang Diberi Kuasa (PYDK) Dalam Urusan Pentadbiran Kontrak.
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Chapter 18 – DEFECTS MANAGEMENT
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 19
FINAL ACCOUNT AND
FINAL CERTIFICATE
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Table of Contents
Table of Contents .....................................................................................................................19-i
List of Flowcharts .................................................................................................................... 19-ii
19.1 INTRODUCTION.........................................................................................................19-2
19.2 PROCEDURES ............................................................................................................19-2
19.3 REFERENCE DOCUMENTS...........................................................................................19-6
19.4 REFERENCES .............................................................................................................19-6
APPENDIX 19A Checklist for the Preparation of Final Account(Senarai Semakan Penyediaan Perakuan Akaun Muktamad) ……………………... 19A-1
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Flowchart Description Action By Reference
1. Certificate of PracticalCompletion
-
2. Prepare the Statement of Final Account and FinalCertificate Ensure that the
necessaryadjustments to theContract Sum areapproved
CAO Refer Checklist for Preparation
of Final Account and
Final Certificate;
& the current form JKR66A
3. Quality Audit BUBK Refer Ch. 10,Flowchart 10-2
4. Approval of Statement of Final Account and FinalCertificate
SO / AP
5. Issue Statement of Final
Account and FinalCertificate to Contractorand respective parties.
CAO
6. Forward documents to FDfor payment
CAO
7. Prepare CompletionReport, etc
SOR Volume 11 – Construction Management
Flowchart 19.1 – Final Account and Final Certificate
1
2
7
5
6
4
3
Passes
Fails
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
19 FINAL ACCOUNT AND FINAL CERTIFICATE
19.1 INTRODUCTION
This chapter provides:
The guidelines on the preparation of the final accounts, and the issuance of the final certificate.
19.2 PROCEDURES
Please refer to Flowchart 19.1 – Final Account and Final Certificate.
Step Procedures / Tasks Action By
/ Reference
1 Generally
The Final Account must be prepared as soon as is practicable,
after Practical Completion; and
the Contractor has fulfilled his obligations under theContract, which includes the making good of defects
The Contractor is required to submit, not later than 3 monthsafter practical completion, the full particulars of all claims,together with such supporting documents (includingdocuments relating to accounts of Nominated Sub-Contractorand Nominated Supplier, if any) as may be necessary for thepreparation of the Final Accounts.
If the Contractor fails or refuses to submit the informationwithin the time, the Final Accounts may be prepared based onthe information at hand so as to enable the Final Accounts andFinal Certificate to be completed within 3 months after the endof defects liability period or issuance of the Certificate of Completion of Making Good Defects, whichever is the later.
Final Accounts and Final Certificate following Determination
Where the employment of the Contractor was terminated, the
Final Accounts and Final Certificate shall be prepared as soonas practicable after the new contractor is appointed and theassessment of the costs and/or loss or damage to theGovernment/DID is completed. A modified Form JKR66A isused (Final Account After Determination of Employment of theContractor / Perakuan Muktamad Kontrak Yang ManaDitamatkan Pengambilan Kerja Kontraktor).
For procedures following determination, please refer toChapter 16.
For information
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Step Procedures / Tasks Action By
/ Reference
2 Preparation of the Statement of Final Account and FinalCertificate
(a) Adjustment of Contract Sum
Before preparing the Final Account and Final Certificate (formJKR66A), ensure that all adjustments to the Contract Sum areapproved and carried out, i.e. for,
o Adjustment for Prime Cost and Provisional Sumso Re-measurement of provisional quantitieso Variations to the Contracto Assessments of claims by the Contractor.
Ensure that all Variation Orders (APK) and Adjustment of
Contract Sum (PHK) have been issued and are correct.
Ensure that the SO and contractor sign the JKR-APK and JKR-PHK, as the case may be.
Action by: SOR/CAO
Refer to Chapter 12, and the
Checklist for Adjustment of
Contract Sum
(b) Prepare Form JKR66A
Use the current Form JKR 66A.
Ensure that the form is duly filled in with the correct contractdata, and that the sums, adjustments and computation arecorrect.
The Final Account must take into account the following:
All adjustments to the Contract Sum;
Payments previously paid to the Contractor, NominatedSub-Contractor and Suppliers, and assignees; and
Permitted deductions under the Contract, such as costsincurred in connection with employment of others toexecute such works to give effect to an S.O.’s instruction,Liquidated Ascertain Damages (LAD), costs for makinggood defects, etc.
Recoupment of Advance Payment
Deductions for direct payment by DID for dues orcontributions under the Employment Ordinance, theEmployee’s Social Security Act, the Employee’s ProvidentFund Ordinance and any other laws relevant to theemployment of workmen.
The release of Performance Guarantee Sum (if any).
Action by: SOR/CAO
Refer to Checklist for Preparation of
Final Account (Penyedian
Perakuan Akaun Muktamad )
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Step Procedures / Tasks Action By
/ Reference
(c) Supporting Documents
Attach the required supporting documents to the Final Accountand Final Certificate:
Certificate of Practical Completion;
Certificate of Non- Completion; if any
Certificate of Completion of Making Good Defects;
Certificate of Delay and Extension of Time, if any;
Certificate of Adjustment of Contract Sum, if any;
Certificate of Payment of Performance Guarantee Sum, if any;
Payment voucher(s); and
Letter of release from the Department of Labour, orStatutory Declaration (to the effect that workmenemployed have received all wages) made by theContractor**.
**The letter or statutory declaration must be submitted by the
Contractor before the final payment can be effected to theContractor.
Action by: SOR/CAO
(d) Check documents for completeness, and computation
Upon receipt of the Final Account and Final Certificatedocuments:
Check that each document is complete and/or in order.Refer to the Checklist for Preparation of Final Account (Penyedian Perakuan Akaun Muktamad);
Complete and initial the Checklist for Preparation of Final
Account;
The recommending officer shall sign the Form JKR66A; and
Submit Form JKR66A, together with attached documents,to the SO for signature
Action by: SOR/CAO
Refer to Checklist for Preparation of
Final Account (Penyedian
Perakuan Akaun Muktamad )
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Step Procedures / Tasks Action By
/ Reference
3 Quality Audit
Forward the Statement of Final Account and Final Certificate
for checking (quality audit) by the relevant contract officer.
The quality auditor shall check that the documents are in orderand free of errors.
Action by:CAO/BUBK
4 Approval of Final Account and Final Certificate
The Final Account and Final Certificate must be signed by theS.O..
Action by: CAO/SO
5 Issue Final Account and Final Certificate to Contractor
The Final Account and Final Certificate must be forwarded toContractor and copies distributed to all parties involved in theContract (Accountant General).
It is not a contractual requirement that the Contractor mustsign and return a copy of the Final Account and FinalCertificate.
Action by: CAO
6 Forward documents to the Finance Division
The Final Account and Final Certificate must be forwarded tothe relevant Finance Division to effect payment.
Action by: CAO / FD
7 Prepare Completion Report, etc
As final duties, the SOR/PT are to prepare and submit the
Final (Completion) Report, and Contractor’s Performance Report (if necessary).
Please also refer to Volume 11 – Construction Management.
For information
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
19.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
JKR 66A : Final Account and Final Certificate
Letter of Discharge of Bank / Finance Company / Insurance Guarantee
19.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on Final Account and Final Payment.
Treasury Circular(Surat Pekeliling Perbendaharaan)
Nil
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPS Bil. 2/2000: 2. Pindaan ke atas Borang JKR 66, Perakuan Pelarasan Jumlah HargaKontrak (PPJHK) dan Perakuan Muktamad
3. Pindaan Kepada Syarat-syarat Kontrak Berkaitan Bayaran
[2] SP JPS Bil. 4/2008: Langkah-langkah Untuk Mempercepatkan Bayaran Interim (Tambahankepada Surat pekeliling SP JPS Bil. 2/2000)
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DID MANUALVolume 10
Contract Administration
Revision Number : Revision 0
Revision Date : March 2009
Chapter 19 – Final Account and Final Certificate
APPENDIX 19A
Checklist for the Preparation ofFinal Account
[Form JKR 66A]
(Senarai Semakan PenyediaanPerakuan Akaun Muktamad)
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
APPENDIX 19A CHECKLIST FOR THE PREPARATION OF FINAL ACCOUNT
(SENARAI SEMAKAN PENYEDIAAN PERAKUAN AKAUN
MUKTAMAD)
TAJUK
PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterim
aOleh
Tarikh Siap Semakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
1. Pastikan perkara-perkara berikutdipatuhi sebelum penyediaan PerakuanMuktamad disiapkan.
(i) Semua Wang Kos Prima(termasuk layanan dankeuntungan) & Wang PeruntukanSementara telah diselaraskan.
(ii) Semua item untuk KuantitiSementara telah dibuatPengukuran Semula.
(iii) Semua item/kerja yang tidak
dilaksanakan (omission) ataudikurangkan daripada kontrak telah disediakan APK
(iv) Semua APK & PHK telahdiselaraskan.
(v) Pelarasan pengiraan baki untuk VOP telah dibuat.
(vi) Semua tuntutan antarakontraktor dan Kerajaan telahdiselesaikan
Tandakan ()selepassemakan
2. Borang Perakuan Muktamad.
2.1 Pastikan borang JKR 66A yang terkinidigunakan.
Muka surat 1 / 4
2.2 KERAJAAN - bermaksud 'KERAJAANMALAYSIA' bagi projek Persekutuanatau 'KERAJAAN ...............' bagiprojek Negeri.
2.3 Peruntukan pembangunan, kepala dan
pecahan kepala - hendaklah diisi.
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
Muka surat 1 / 4 (samb.)
2.4 Tajuk kerja, nama dan alamatkontraktor hendaklah sama seperti didalam dokumen kontrak.
2.5 No.Kontrak dan Jumlah Harga AsalKontrak hendaklah sama seperti didalam dokumen kontrak.
2.6 Jumlah Bersih Tambahan / Potongan
(i) Ambil Jumlah Bersih dari PenyataPelarasan Harga Kontrak di mukasurat 4/4.
2.7 Harga Muktamad Kontrak adalahHarga Kontrak setelahditambah/dipotong jumlah bersih APK & PHK.
2.8 Perkara A - Butir-butir JumlahPotongan / Kurangan
(i) Perkara A.1 - pastikan semula jumlah bayaran interim yangterdahulu berasaskan baucerbayaran.
(ii) Perkara A.2 - pastikan jumlahsemua bayaran WangPendahuluan, jika ada yangdibuat berasaskan baucerbayaran (termasuk bayaranWang Pendahuluan kepadaNSC/NS).
(iii) Perkara A.3 - Jumlah Potonganlain termasuk bayaran kepadapihak ketiga, jika ada (sertakanlampiran dan keteranganpotongan).
2.9 Bayaran Muktamad Dibawah Kontrak adalah Harga Muktamad Kontrak ditolak dengan perkara A.1, 2 dan 3.
2.10 Tandatangan Pegawai Pengesyorhendaklah pegawai yang diberi kuasadan catitkan nama dan jawatan.
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
Muka surat 1 / 4 (samb.)
2.11 Perkara 'B'
(i) Pastikan amaun dalam perkataan
jumlah sebenar bayaranPerakuan Muktamad.
(ii) Perkara B.1.(ii) - Pastikanketepatan bayaran balik kepadaKontraktor Utama bagi pelepasanDeposit Wang JaminanPelaksanaan. (Jika berkenaan).
(iii) Perkara B.2 - Pastikan ketepatanbaki bayaran kepadaSubkontraktor/Penerima Bayaranseperti di Lampiran A.
(iv) Perkara B.3 - Pastikan ketepatanpengiraan kredit hasil bagi LADberasaskan perbezaan tarikh CPCdengan tarikh Lanjutan Terakhirdan kadar LAD di dalam kontrak.
(v) Perkara B.1.(i) – Pastikanperkiraan nilai kerja dan amaun-amaun lain bagi KontraktorUtama adalah perbezaan antaraBayaran Muktamad dan jumlahPerkara B.1.(ii), B.2 & B.3
2.12 Pastikan Jumlah Bayaran Muktamadmenyamai Bayaran Muktamad diBawah Kontrak.
2.13 Masukkan No. Fasal berkenaan dengan Akuan Statutori mengikut syarat-syaratkontrak berkenaan seperti 48(d) bagiborang JKR 203/203A.
2.14 Tandatangan Pegawai Penguasahendaklah pegawai yang diberi kuasa
dan catitkan nama dan jawatan.
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
Muka surat 2 / 4
2.15 Perkara ‘C’
Pastikan pihak kontraktor adalah orangyang sama yang menandatanganikontrak atau wakil lain yang diberikuasa. Tandatangan hendaklahdisaksikan dan dilengkapi dengantarikh serta maklumat diri yangdikehendaki.
2.16 Sebelum Perakuan Akaun dan BayaranMuktamad diluluskan, pastikan perkaradi bawah ini telah dilaksanakan.
(a) Perakuan Siap Kerja telahdikeluarkan.
(b) Surat Akuan Statutori atau Surat Akuan Ketua Pengarah Buruhtelah diterima daripada kontraktordan disertakan bersama.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Audit Kualiti; Jika Berkenaan
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 20
PRIME COST & PROVISIONAL
SUMS
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Table of Contents
Table of Contents .....................................................................................................................20-i
List of Flowcharts .................................................................................................................... 20-ii
20.1 INTRODUCTION.........................................................................................................20-3
20.2 PROCEDURES ............................................................................................................20-3
20.2.1 Administration of Prime Cost Sums..................................................................20-3
20.2.2 Administration of Provisional Sum .................................................................20-11
20.3 GUIDANCE NOTES ...................................................................................................20-16
20.3.1 Definitions ...................................................................................................20-16
20.3.2 Nomination of Sub-Contractors and Suppliers under P.C. Sum ........................20-16
20.3.3 Appointment of Sub-Contractors and Suppliers under Provisional Sums...........20-16
20.3.4 Expending the P.C. Sums..............................................................................20-17
20.3.5 Expending the Provisional Sums....................................................................20-17
20.3.6 Procurement under P.C. Sum and Provisional Sum .........................................20-17
20.4 REFERENCE DOCUMENTS.........................................................................................20-17
20.5 REFERENCES ...........................................................................................................20-19
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
List of Flowcharts
Flowchart Description Page
Flowchart 20.1 Administration of Prime Cost Sums 20-1
Flowchart 20.2 Administration of Provisional Sums 20-2
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Flowchart Description Action By Reference
1. Prime Cost Sums orProvisional Sums areincluded in the ContractSum
-
2. Is it Prime Cost Sum? -
A. Administration of Provisional Sums
- Refer
Flowchart
20.2
3. Prepare TenderDocuments
PT/PO
4 Invitation and Receipt of
Tender
PT/PO
5. Tender Evaluation and
Nomination / Acceptance
PT/PO
6. Sub-Contract
Documentation
PT/CAO
7. Sub-Contract
Administration Commencement
Direct Payment
SO’s consent
PT/CAO
8. Completion -
Flowchart 20.1 – Administration of Prime Cost Sums
4
5
8
6
7
1
2
A
No
3
Yes
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Flowchart Description Action By Reference
A Provisional Sum isincluded in the Contract
Sum
- Refer Flowchart
20.1
1. Prepare cost estimates of works under Provisional
Sum.
CAO/Ir/Sr
2. Is the estimates of works
30% more than theProvisional Sum?
-
3. Is the estimates of works50% more than the
Provisional Sum?
-
4. Obtain approval from
Division Director
CAO /
Division DirectorUse
‘Borang E’
5. Obtain approval from DG
or Deputy DG
CAO/
DG /Deputy DGUse
‘Borang E’
6. Does the work require the
involvement of the main
contractor?
-
7. Quotation exercise SOR
8. Is it specialist works? -
9. Tender or quotation
exercise by Contractor
SOR
10. Issue SO instruction tomain contractor, andprepare valuation of works
SOR/ SO/CAO
11. Obtain approval (on costs)from Authorised Person
CAO /Authorised
Person
Use ‘Borang F’
12. Appointment of sub-contractor or supplier.
Flowchart 20.2 – Administration of Provisional Sums
12
11
1
2
3
5
No
4
6
Yes
No
Yes
9
8
10
7
No
Yes
No
Yes
A
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20 PRIME COST & PROVISIONAL SUMS
20.1 INTRODUCTION
This chapter provides:
The guidelines on expenditure of Prime Cost (P.C.) and Provisional Sums. The guidelines on the preparation of tender documents, contract documents and general
administration of nominated sub-contract and supply contracts.
Note: Refer to Section 20.3 for definitions and general overview on procurement of items underPrime Cost Sums and Provisional Sums.
20.2 PROCEDURES
20.2.1 Administration of Prime Cost Sums
(Nominated Sub-Contractor and/or Nominated Supplier)
Step Procedures / Tasks Action By
/ Reference
1 & 2 Prime Cost Sums
Please refer to Flowchart 20.1 – Administration of Prime CostSums.
Where the Contract specifically permits the nomination of sub-contractor to carry out works included under Prime Cost, or theSO has elected that works under Provisional Sums shall beexecuted by nominated sub-contractor or nominated supplier,then the PT/PO shall carry out the tender exercise forprocurement of sub-contract works.
The Project Team must give due consideration to the overallworks programme, and ensure the timely nomination of sub-contractor or supplier so as to avoid any delay to the works.
The procedures for preparation of tender documents,invitation, receipt, evaluation and acceptance of tenders, sub-contract documentation, payment, variation, delay andextension of time, non-completion, determination, completion,
handing over and defects, and final accounts are similar to thatfor the main contract, and reference should be made toChapters 6 to 19, inclusive.
Changes in points of detail are set out in this chapter.
For information
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
3 Preparation of Tender Documents
The procedures for the preparation of tender documents andtender table documents set out in Chapter 6 are generallyapplicable to the preparation of tender documents and tendertable documents for a nominated sub-contract.
The sub-contract tender document shall follow the maincontract number, with the words ‘NSC’ and the sub-contractworks package number in parentheses appended at the end,eg: JPS/IP/P/1/99(NSC 1).
(a) Generally, the TENDER DOCUMENT FOR WORK comprisesthe documents in the following order:
Tender Notice Instructions to Tenderer Form of Tender (JKR 203N1) Conditions of Contract
(JKR 203N, including amendments and SpecialProvisions)
Relevant Particulars of the Main Contract Specification Summary of Tender and Schedule of Rates; or Bills of
Quantities Schedule of Technical Information List of Drawings
The sample contents page for the tender document is set outin Volume 10A, Chapter 20.
For information
Action by: PT/PO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
3(Cont’d)
Preparation of Tender Documents (Cont’d)
(b) Generally, the TENDER DOCUMENT FOR SUPPLY OFMATERIALS OR GOODS comprises the documents in thefollowing order:
Tender Notice Instructions to Tenderer Form of Tender (JKR 203P 1) Conditions of Contract
(JKR 203P, including amendments and SpecialProvisions)
Relevant Particulars of the Main Contract Specification
Schedule of Prices Schedule of Technical Information
The sample contents page for the tender document is set outin Volume 10A, Chapter 20.
(c) Generally, the TENDER DOCUMENT FOR SUPPLY OFMATERIALS OR GOODS comprises the documents in thefollowing order:
Tender Notice Instructions to Tenderer Form of Tender (JKR 203P 1) Conditions of Contract
(JKR 203P, including amendments and SpecialProvisions)
Relevant Particulars of the Main Contract Specification Schedule of Prices Schedule of Technical Information
The sample contents page for the tender document is set outin Volume 10A, Chapter 20.
Action by: PT/PO
Action by: PT/PO
4 Invitation and Receipt of Tender
The procedures for the invitation and receipt of tender set outin Chapter 7 are generally applicable to the invitation andreceipt of tender for a nominated sub-contract.
Invite the Main Contractor to tender for the sub-contract worksif the Main Contractor is suitably qualified.
Action by: PT/PO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
5 Tender Evaluation and Nomination / Acceptance
(a) Tender Evaluation
The procedures for the tender evaluation and acceptance setout in Chapter 8 are generally applicable to the tenderevaluation of a nominated sub-contract
In the evaluation of tender, the following percentagepreference are applied for specialist bumiputra contractors forsupplies and services:
Value of Work PreferenceWeightage
Exceeding RM100,000 – RM500,000 10%
Exceed RM500,000 - 1.5 million 7%
Exceeding RM 1.5 million – RM 5 million 5%
Exceeding RM 5 million – RM 10 million 3%
Exceeding RM10 million – RM 15 million 2.5%
Exceeding RM15 million No preference
(b) Nomination & Acceptance
Upon the approval of the Procurement Board,
the SO shall issue the Letter of Nomination theContractor and instruct to accept the tender, or
if the Contractor’s tender is accepted, the S.O. shallissue the Letter of Acceptance to the Contractor.
Action by: PT/PO
Refer: SPP 4/1995
Action by: SOR/SO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
5(Cont’d)
Tender Evaluation and Nomination / Acceptance (Cont’d)
(b) Nomination & Acceptance (Cont’d)
Upon the approval of the Procurement Board,
the SO shall issue the Letter of Nomination theContractor and instruct to accept the tender, or
if the Contractor’s tender is accepted, the S.O. shallissue the Letter of Acceptance to the Contractor.
(i) Letter of Nomination
Use the current form for Letter of Nomination:
for nomination of sub-contractor: Form JKR 203N3
for nomination of supplier: Form 203P3
(ii) Letter of Acceptance
Use the current form for Letter of Acceptance of MainContractor’s Tender for work or Supply of Materials orGoods Under Prime Cost Sum, where the Main Contractorshall carry out works allocated under Prime Cost orProvisional Sums.
Use the current and appropriate form for the nomination,notification and/or acceptance, as the case may be.
Action by: SOR/SO
6 Sub-Contract Documentation
The procedures for the preparation of contract document setout in Chapter 9 are generally applicable for the preparation of the sub-contract documents.
The sample contents page for the contract document is set outin Volume 10A, Chapter 20.
Action by: PT/CAO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
7 Sub-Contract Administration
(a) Generally
Generally, the Contractor is fully responsible for the acts of theSub-Contractor/Supplier.
With the exception of payment matters, the Contractor is alsoresponsible for the day-to-day administration of the sub-contract / supply contract, including matters (where applicable)relating to
Variations Delays and Extension of Time
Non-Completion Loss and Expense Determination
The written consent of the SO is required before the Contractormay agree to, or grant, and additional time to the sub-contractor, or to determine the employment of the sub-contractor / supplier, as the case may be.
(b) Direct Payment
Direct payment to nominated sub-contractors and suppliers arepermitted under the terms of the contract and sub-contract,
subject to the following procedures or conditions are fulfilled:
(a) Direct progress payment up to the limit of 90% of Sub-contract Sum
(b) The remainder 10% of the Sub-contract Sum shall be paidto the Main Contractor after the issuance of the Certificateof Practical Completion. The PT shall ensure that the MainContract releases the remainder sums to the Sub-Contractor after the Defects Liability Period.
(c) Ensure that the conditions for direct payment are included
in the tender documents and the sub-contract.
(d) The sub-contractor is registered as bumiputra contractorunder the relevant class, and is a local contractor operatingat the area where the project is to be carried out.
For information
Action by: PT/ CAO/Finance Division
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
7(Cont’d)
Sub-Contract Administration (Cont’d)
(b) Direct Payment (Cont’d)
(e) Ensure that the conditions for direct payment are stated inthe Letter of Acceptance (LoA) to the Main Contractor, andthat the Main Contractor submits the a complete list of sub-contractors he intents to employ.
(f) Ensure that there is no assignment of payments to others,other than the sub-contractors listed by the MainContractor.
(g) The Main Contractor is not permitted to amend the list of
sub-contractors without written permission of theGovernment/DID.
(h) The main contract includes an indemnity clause tosafeguard the rights of the Government / DID.
(c) Written Consent of the S.O.
The written consent of the SO is required before the Contractormay carry out any of the following under the terms of the sub-contract:
Permit sub-contractor’s to employ workmen not in
accordance with Government’s prescribed ratio (clause12(b))
Permit Sub-letting (clause 19) Grant extension of time (clause 26(b)) determine the employment of the sub-contractor (clauses
28(a) and (b)). employ others or himself undertake the sub-contract work
following the determination of the nominated sub-contractor (clause 28(c)(ii)).
Action by: PT/ CAO/Finance Division
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
7(Cont’d)
Sub-Contract Administration (Cont’d)
(c) Written Consent of the S.O. (Cont’d)
In addition to the above, the S.O.’s certificate is required forthe following:
a certificate, stating the nominated sub-contractor’s default,be issued by the S.O. prior to calling of performance bondby the Main Contractor (clause 24(b))
a certificate, stating that the nominated sub-contractor is indelay, prior to deduction for loss or damages by the MainContractor (clause 27).
(d) Default on the Part of the Sub-Contractor / Supplier
Where the Nominated Sub-contractor or Supplier in theexecution of the work or the supply of the materials or goodsunder the sub-contractor, the Main Contractor shall beresponsible to have the works executed or the materials orgoods supplied by whatsoever means necessary.
The Government/DID is not required to re-nominate. Thecontractor is only entitled to be paid the same sum as if theNominated Sub-contractor or Supply had not defaulted, andthe contractor is not entitled to extension of time by reasons of such default.
Action by: PT /SO
For information
7 & 8 Commencement and Completion of Sub-Contract Works
The Main Contractor shall issue an Official Order to Commence,using form JKR 203N5, and the Nominated Sub-Contractor isrequired to complete the works within the time for completionstated in its Form of Tender.
Nominated Supplier
The Main Contractor shall issue an Order For Supply andDelivery of Articles, using form JKR 203P5, and the Nominated
Supplier is required to complete the supplies within the timefor completion stated in its Form of Tender.
Defects Liability
Refer to the Main Contract for defects liability obligations andrights.
For information
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.2.2 Administration of Provisional Sum
Step Procedures / Tasks Action By
/ Reference
A Provisional Sums
Please refer to Flowchart 20.2 – Administration of ProvisionalSums.
The Project Team must give due consideration to the overallworks programme, and ensure the timely appointment of sub-contractor or supplier so as to avoid any delay to the works.
1 Preparation of Cost Estimates
Prepare cost estimates for the works to be carried out undereach Provisional Sum.
At this stage, the scope of works shall have been sufficientlyclearly identified or defined to enable the works to be priced.
The cost estimate for the works shall be prepared by anofficer who has the relevant experience or expertise.
Action by: CAO
2 Approval Before Proceeding with Procurement
Approval of the Authorised Person is required if the estimatedcost of works for each Provisional Sum exceeds thatProvisional Sum by more than 30%.
Use the current ‘Borang E’ – Permohonan Permohonan Untuk Melaksanakan Item Di Bawah Wang Peruntukan Sementara Yang Dijangka Melebihi *30%/50% Dari Peruntukan Asal..
Action by: CAO
JPS SP Bil 1/2007
3, 4 & 5 Authorised Person
If the estimated cost of works exceeds the Provisional Sumby more than 30% up to the limit of 50%, the AuthorisedPerson shall be the Division Director.
If the estimated cost of works exceeds the Provisional Sumby more than 50%, the Authorised Person shall be theDirector General or Deputy Director General.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
6 & 7 Procurement of Works Not Requiring Involvement of the MainContractor
If the works do not require the involvement of the Contractor(eg aerial photography or works carried out off-site), thenproceed to invite tender/quotation directly from qualified sub-contractors or suppliers.
Comply with the DID guidelines on calling of tender/quotation.
Direct payment may be to such sub-contractor or suppliermay be effected through Indent or Local Purchase Order(Inden / Pesanan Tempatan).
Action by: SOR/CAO
For information.
8 & 9 Works To Be Carried Out By Specialists – Calling of Tender/Quotation By Contractor
For specialist works exceeding RM200,000, open/selectivetender shall be called by the Contractor.
For works value not exceeding RM200,000, work may beprocured by the Contractor through quotation exercise.
The Contractor may tender/quote for the specialist works, if has the necessary qualifications. In such cases, theContractor shall not be entitled to profit and attendance on histender/quotation.
For information
Contractor shall prepare and call tender/quotation
The SOR/PT shall prepare specifications, Needs Statement,or design (‘design documents’), and provide the same tothe Contractor.
Design and Build. For DB contracts, the Contractor shallprepare the specifications, Needs Statement or design(‘design documents’) for the tender/quotation documents.
The Contractor shall prepare the tender/quotationdocument based on the design documents, and providethe list of suitably qualified sub-contractors or suppliers(‘tenderers’) for the SOR’s approval.
The SOR/PT must check the tender/quotation documentsare in order and free from errors. The SOR shall provide alist of suitably qualified tenderers.
To total number of tenders shall not be less than 5,selected from both the lists provided by Contractor and theSOR.
Action by:SOR/PT
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
8 & 9(Cont’d)
Works To Be Carried Out By Specialists – Calling of Tender/Quotation By Contractor (Cont’d)
Contractor shall prepare and call tender/quotation (Cont’d)
The Contractor shall prepare sufficient number of tenderdocuments.
For quotations, the tenderers must submit 2 set of documents.
Action by:SOR/PT
Closing of Tender/Quotation
The SOR shall prepare and issue the invitation for
tenders/quotations.
The tenders/quotations shall be closed on the fixed dateand time.
The quotations/tenders shall be opened in the presence of a committee, comprising representatives of the SOR andContractor.
Evaluation of Tender/Quotation
For tenders, the evaluation shall be carried out by the
SOR, and the SOR shall recommend the lowest andtechnically complying tender.
Design and Build. For DB contracts, the evaluation shallbe carried out by the Contractor, and the Contractor shallrecommend the lowest and technically complyingquotation.
For quotations, the evaluation shall be carried out by theContractor, and the Contractor shall recommend the lowestand technically complying quotation.
(a) The SOR shall verify the recommendation, and mayfurther negotiate for a fair sub-contract sum orcontract rates.
(b) The sub-contract sum or contract rates shall beinclusive of the Contractor’s Profit and Attendance.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
8 & 9(Cont’d)
Works To Be Carried Out By Specialists – Calling of Tender/Quotation By Contractor (Cont’d)
Profit and Attendance (P&A)
The Profit and Attendance (P&A) shall be inclusive of Contractor’s management costs, profit and attendance.
For Quotation, the Contractor’s P&A shall be as stated inthe Contract or, if not stated then, it shall not exceed7.5%.
For Tender, the Contractor’s P&A shall be as stated in theContract or, if not stated then, it shall not exceed the
following rates:
Value of Works Maximum Rate for P&A
RM500,000 or less 7.5%
> RM500,000 – RM 1 million 5%
> RM 1 million - RM 5 million 4%
> RM 5 million – RM 10 million 3%
> RM 10 million <3%
If the Contractor’s tender/quotation is accepted, theContractor shall not be entitled to profit and attendance onhis tender/quotation.
10 Works To Be Carried Out By Main Contractor
For normal category of works (‘kategori biasa’), or workswhich the Contractor possesses the necessary skills, the SOmay issue the necessary SO Instruction for the Contractor tocarry out the works.
The valuation of works shall be in accordance with thevaluation rules of the Contract, i.e. based on contract rates or,in the absence of contract rates, based on fair valuation.
Action by: SOR / SO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
11 Approval of Value of Works
The tender/quotation evaluation and recommended sub-contract / supply contract value shall be approved by a
Variation Order Committee (‘Authorised Person’).
The sub-contract / supply contract value shall be inclusive of the Contractor’s Profit and Attendance.
Submit the application for the approval of sub-contract value /supply contract value to the Authorised Person for approval.
Use the current ‘Borang F’ – Permohonan Untuk Kelulusan Harga Bagi Item Wang Peruntukan Sementara .
See Chapter 5 – Authority for Authorised Person, and limit of authority
Action by: SOR
12 Appointment of Sub-Contractor or Supplier
SO’s Instruction
Issue the necessary instruction to the Contractor to effect theappointment of the sub-contractor or supplier, as approved bythe VO Committee.
Direct Payment and Deed of Assignment
The DID may make direct payment to such sub-contractor orsupplier through the execution by the Contractor of the ‘Deedof Assignment’ (Surat Ikatan Penyerahan Hak Faedah), infavour of the appointed sub-contractor or supplier.
For avoidance of disputes, a copy of the Deed of Assignmentshall be appended to the SO’s Instruction for the appointmentof sub-contractor or supplier.
The Deed of Assignment may be used if there is nooverlapping of sums which is assigned under the main
contract.
Form JKR 203N
For works let under Form JKR 203N, direct payment to thesub-contractor shall be effected through the procedures forNominated Sub-Contractor or Nominated Supplier (see Section20.3.2, above).
Action by: SOR/SO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.3 GUIDANCE NOTES
20.3.1 Definitions
"Nominated Sub-contractor" means any contractor, specialist or other person nominated by the S.O.
in accordance with the Contract to be employed by the Contractor for the execution of work orsupply of goods materials or services for which a Prime Cost Sum (or P.C. Sum) has been inserted inthe Contract or ordered by the S.O. to be employed by the Contractor to execute work or supplygoods materials or services under a Provisional Sum.
“Prime Cost Sum” or “P.C. Sum” is an amount included in a bill of quantities to cover a particular bitof work or supply of materials to be carried out by a nominated sub-contractor or a supplier.
Generally, P.C. Sums are included in the Contract for works to be carried out by specialist contractorsor suppliers.
"Provisional Sum" means a sum included and so designated in the Contract as a specific allocation
for the execution of work or the supply of goods materials or services which may be used in whole orin part or not at all at the direction and discretion of the S.O..
Generally, Provisional Sum are allocated for the execution of works or for supply of goods or servicesfor which
an exact price cannot be obtained/ascertained or are not clearly identified or defined
at the time of tender.
20.3.2 Nomination of Sub-Contractors and Suppliers under P.C. Sum
The contract may permit the Government / DID to nominate a sub-contractor to carry out work or asupplier to provide goods which is included under any Prime Cost or Provisional Sum.
The Forms JKR203 and 203A includes such right of nomination, whereas Form JKR DB/T does not.
Under the JKR Forms 203/203A, any work or supply of goods or materials covered by ProvisionalSums may be treated as P.C. Sum items if the S.O. so decides.
20.3.3 Appointment of Sub-Contractors and Suppliers under Provisional Sums
The sub-contractor or supplier may be appointed by the Contractor pursuant to the S.O.’s Instructionon the expenditure of Provisional Sums. The sub-contractor or supplier is not a nominated sub-
contractor or nominated supplier pursuant to the terms of the Contract.
The DID may make direct payment to such sub-contractor or supplier through the execution by theContractor of the ‘Deed of Assignment’ (Surat Ikatan Penyerahan Hak Faedah), in favour of theappointed sub-contractor or supplier.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.3.4 Expending the P.C. Sums
The tender evaluation report (kertas taklimat tender) for the sub-contract must be submitted to theTender Board for approval.
Please also refer to Chapter 5 – Authority, and Chapter 8 – Tender Evaluation and Acceptance.
20.3.5 Expending the Provisional Sums
If the estimated cost of works is expected to exceed the Provisional Sum by 30% or more, then theProject Team must seek prior approval from the Authorised Person prior to the expenditure of theProvisional Sum.
The valuation or prices for the sub-contract or suppler must be submitted to the Authorised Personfor approval prior to the appointment of the sub-contractor or supplier.
If the estimated cost of works does not exceed the Provisional Sum, or exceeds the Provisional Sum
by less than 30%, the Project Team may proceed with the procurement and seek approval of the Authorised Person prior to the appointment of the sub-contractor or supplier.
20.3.6 Procurement under P.C. Sum and Provisional Sum
The PT/PO shall carry out the
tender exercise, or quotation exercise (as the case may be),
for the sub-contract works, where such Prime Cost Sums or Provisional Sums are included in theContract.
20.4 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents for the procedures orprocesses outlined in this Chapter.
Nominated Sub-Contractor
JKR 203N/83 (including addendum) : Form of Contract To Be Used For Nominated Sub-Contractors Where the Main Contractor is Based Upon Form JKR 203 Or 203A
JKR 203N1/83 (including addendum) : Form of Tender For Use by Nominated Sub-Contractor
JKR 203N2/88 : Conditions of Tendering and General Information For Use By Nominated Sub-Contractor
JKR 203N3/93 : Letter of Nomination
JKR 203N4/83 : Letter of Acceptance of Tender By Main Contractor To Nominated Sub-Contractor
JKR 203N5/83 : Official Order to Commence Work By Main Contractor To Nominated Sub-Contractor
JKR 203N6/88 : Letter of Nomination of Sub-Contractor
JKR 203N7/88 : Letter of Indemnity From Nominated Sub-Contractor to the Government
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Nominated Supplier
JKR 203P/83 (including addendum) : Form to be used for Nominated Suppliers Where The MainContractor is based upon Form JKR 203 or 203A
JKR 203P1/83 : Form of Tender For Use By Nominated Suppliers
JKR 203P2/83 : Conditions of Tendering And General Information For Use by NominatedSuppliers
JKR 203P3/83 : Letter of Nomination
JKR 203P4/83 : Letter of Acceptance of Tender by Main Contractor To Nominated Supplier
JKR 203P5/83 : Order For Supply and Delivery of Articles – to be issued by Main Contractor tothe Nominated Supplier
JKR 203P5A/83 : Schedule of Articles Ordered To Be Supplied and Deliverd
JKR 203P6/88 : Letter of Notification of Nomination of Supplier
JKR 203P7/88 : Letter of Indemnity From Nominated Supplier to the Government
Generally
Bank Guarantee Form for Performance Bond (Nominated Sub-Contract Works)
Deed Of Assignment (Security For Direct Payments To A Third Party)(Surat Ikatan Serah Hak)
The Consent Of The Government Of Malaysia To The Deed Of Assignment For Direct Payment To A Third Party
Expending Provisional Sum
‘Borang E’ – Permohonan Permohonan Untuk Melaksanakan Item Di Bawah Wang PeruntukanSementara Yang Dijangka Melebihi *30%/50% Dari Peruntukan Asal.
‘Borang F’ – Permohonan Untuk Kelulusan Harga Bagi Item Wang Peruntukan Sementara.
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20.5 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars for sub-contract tender procedures andsub-contract administration.
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 4 Tahun 1995: Dasar dan Keutamaan Kepada Syarikat Bumiputra Dalam Perolehan Kerajaan
[2] Bil 4 Tahun 2003: Bayaran Terus Kepada Sub Kontraktor
[3] Bil 5 Tahun 2007: Tatacara Pengurusan Perolehan Kerajaan Secara Tender
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPS Bil 4/2003: Bayaran Terus Kepada Sub Kontraktor
[2] SP JPS Bil /2007: Garis Panduan Pengurusan Wang Peruntukan Sementara (WPS)
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DID MANUAL
VOLUME 10
CONTRACT ADMINISTRATION
PART III : POST-CONTRACT
CHAPTER 21
DISPUTE
MANAGEMENT AND RESOLUTION
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Table of Contents
Table of Contents .....................................................................................................................21-i
List of Flowcharts .................................................................................................................... 21-ii
21.1 INTRODUCTION.........................................................................................................21-2
21.2 PROCEDURES ............................................................................................................21-2
21.3 REFERENCES .............................................................................................................21-6
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
List of Flowcharts
Flowchart Description Page
Flowchart 21.1 Dispute Management and Resolution 21-1
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Flowchart Description Action By Reference
1. Disagreement ordifference of opinion orconflict or dispute?
-
2. Determine if there is a ‘dispute’.
PT
3. To use best endeavour toresolve the ‘issue’ amicably
PT
4. Issue(s) are settled? -
5. Refer the dispute to the Authorised Party fordecision
PT / CQS
6. Parties to give effect to
Authorised Party’sdecision.
PT
7. Is there new informationor substantiation from theContractor?
-
8. Contractor gives notice torefer dispute toarbitration?
-
9. Refer the dispute to Legal Adviser at Ministry / A.G.’sChamber for advice andaction.
Director of Contracts & QSDivision
Flowchart 21.1 – Dispute Management and Resolution
Yes
No
1
2
5
7
Yes
No
9
4
No
3
6
End
8
Yes
No
Yes
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
21 DISPUTE MANAGEMENT AND RESOLUTION
21.1 INTRODUCTION
This chapter provides:
An overview of the dispute management and resolution procedures for works contracts. Brief outline of alternative dispute resolution (‘ADR’).
21.2 PROCEDURES
Please refer to Flowchart 21.1 – Dispute Management and Resolution.
Step Procedures / Tasks Action By
/ Reference
1 Generally
Disagreement or difference of opinion or conflict or disputeoften occurs in projects.
The best form of dispute avoidance is the ensure that theappropriate procurement method and form of contract isused, and that the scope of works is clearly and accurately setout in the tender and contract documents.
If practicable, all disagreements or differences of opinion orconflicts should be resolved as soon as possible to avoid anyescalation of the issues into a ‘dispute’.
In dispute management, contemporaneous and completerecords are of utmost importance. Therefore, the PT mustensure that records are properly kept and updated, andavailable when required. (See Volume 11).
For the purpose of this Manual, a ‘dispute’ is deemed to haveoccurred when the disagreement or difference of opinion etchas been formally referred by the Contractor to the
Authorised Party under the terms of the contract.
All other issues (i.e. disagreements or differences of opinion
or conflicts) should be resolved by way of negotiation oramicable settlement as soon as practicable.
For information
2 Ascertainment of ‘Dispute’
Ascertain if there is in actuality a “dispute”, whereby theparties must comply with the contractual procedures andarbitration clause.
Action by: SOR / PT
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Step Procedures / Tasks Action By
/ Reference
3 & 4 Amicable Settlement
Unless the ‘dispute’ is formally referred for a decision in
accordance with the contract, the PM/PT should use its bestendeavour to resolve the matter by way of negotiation oramicable settlement.
Upon settlement, record the agreement reached by theparties. This avoids future disagreement on the same issue.
Follow up with the relevant adjustment (if any) to the contractby way of extension of time, Variation or adjustment to theContract Sum, etc, as the case may be.
If parties are not able to make an amicable settlement, then
any party may refer the matter to the Authorised Party underthe Contractor for a decision.
Action by: SOR/PT
5 Referral of Dispute for Decision
If either party has submitted a formally referred the ‘dispute’ to be decided by the Authorised Party:
(a) Upon receipt of the Contractor’s formal request torefer the dispute to the Authorised Party, the PM/PTmust notify the Contracts and Quantity SurveyingDivision immediately.
Action by: SOR/PT
(b) Upon receipt of the Contractor’s formal request torefer the dispute to the Authorised Party, the PM/PTmust notify the Contracts and Quantity SurveyingDivision immediate.
Action by: SOR/PT
(d) The PT shall prepare the documents setting out thebackground of the dispute, with sufficient details forthe Authorised Party to make a decision.
Action by: SOR/PT
(c) The Contracts and Quantity Surveying Division shallrefer the dispute to the officer authorized under the
contract (Authorised Party) to make a decision.
Contracts and Quantity Surveying Division, whereappropriate to do so, shall advise and assist the
Authorised Party in the dispute resolution process.
Action by:BUBK
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Step Procedures / Tasks Action By
/ Reference
(e) The Authorised Party is required to make a decisionwithin the time frame stipulated in the contract.
(f) The Authorised Party may refer the dispute to theClaim Committee for a decision.
For ex-gratia payments, the Claim Committee willrefer the matter to Treasury for decision and/orapproval.
Action by: AtP/ Claims
CommitteeRefer: Treasury Instruction 202
(AP202)
JKR Forms of Contract
For the contracts based on the JKR forms, the time frame forthe S.O. to give a decision is 45 days after the Contractor’s
request for such decision.
Other Forms of Contract
If the contract is not based on JKR forms of contract, pleaserefer to the appropriate provision in the contract for thedispute reference procedures.
For information
For information
6 Compliance with Decision
Comply with the decision of the Authorised Party.
(If the Contractor is dissatisfied with the Authorised Party’s
decision, he must nevertheless comply with the decision butmay refer the dispute for arbitration.)
Follow up with the relevant adjustment (if any) to the contractby way of extension of time, Variation or adjustment to theContract Sum, etc, as the case may be.
Action by: SOR/PT
7 Authorised Party May review its own Decision
If
the Contractor is dissatisfied with the decision of the Authorised Party, and
new information or substantiation has come into theattention of the Authorised Party,
then the Authorised Party may review its earlier decision, orrefer such review (of earlier decision) to the Claim Committeefor confirmation.
Action by: AtP
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Step Procedures / Tasks Action By
/ Reference
8 Notice of Arbitration
The Contractor may refer the dispute for arbitration if
The Authorised Party fails to give a decision within 45 daysafter being requested to do so; or
The Contractor is dissatisfied with the decision of the Authorised Party.
Such requirement to refer the dispute to arbitration must bemade within the period stipulated in the contract.
Generally, the arbitration shall not commence until after thecompletion or alleged of the completion Works, ordetermination or alleged determination of the employment of
the Contractor, except for the followings:
Where there is written consent of the Government/DIDand the Contractor; or
For such dispute following the effect of war or earthquake.
Other Forms of Contract
The above procedure is made in reference to the JKR forms.If the contract is not based on JKR forms of contract, pleaserefer to the appropriate provision in the contract for theprocedures on reference to arbitration.
For information
9 Reference to Legal Adviser at Ministry / A.G.’s Chamber
Upon receipt of the Contractor’s notice to refer a dispute forarbitration (whether or not prior reference was made to the
Authorised for a decision), the PM/PT must notify theContracts and Quantity Surveying Division immediately.
The Contracts and Quantity Surveying Division shall refer thematters to the Legal Adviser at the Ministry for further adviceand action.
The matter may then be referred to the Attorney General’s
Chamber by the Legal Adviser.
The PT shall compile the records and supporting documentsrelevant to the dispute and as may be required for the arbitralproceedings.
Action by:SOR/PT/BUBK
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
21.3 REFERENCES
Treasury Instruction(Arahan Perbendaharaan)
[1] AP 202: Arahan Perubahan Kerja
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Table of Contents
Table of Contents .....................................................................................................................19-i
List of Flowcharts .................................................................................................................... 19-ii
19.1 INTRODUCTION.........................................................................................................19-2
19.2 PROCEDURES ............................................................................................................19-2
19.3 REFERENCE DOCUMENTS...........................................................................................19-6
19.4 REFERENCES .............................................................................................................19-6
APPENDIX 19A Checklist for the Preparation of Final Account(Senarai Semakan Penyediaan Perakuan Akaun Muktamad) ……………………... 19A-1
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
List of Flowcharts
Flowchart Description Page
Flowchart 19.1 Final Account and Final Certificate 19-1
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Flowchart Description Action By Reference
1. Certificate of PracticalCompletion
-
2. Prepare the Statement of Final Account and FinalCertificate Ensure that the
necessaryadjustments to theContract Sum areapproved
CAO Refer Checklist for Preparation
of Final Account and
Final Certificate;
& the current form JKR66A
3. Quality Audit BUBK Refer Ch. 10,Fig. 10-3
4. Approval of Statement of Final Account and FinalCertificate
SO / AP
5. Issue Statement of Final
Account and FinalCertificate to Contractorand respective parties.
CAO
6. Forward documents to FDfor payment
CAO
7. Prepare CompletionReport, etc
SOR Volume 11 – Construction Management
Figure 19.1 Flowchart – Final Account and Final Certificate
1
2
7
5
6
4
3
Passes
Fails
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
19 FINAL ACCOUNT AND FINAL CERTIFICATE
19.1 INTRODUCTION
This chapter provides:
The guidelines on the preparation of the final accounts, and the issuance of the final certificate.
19.2 PROCEDURES
Please refer to Flowchart 19.1 – Final Account and Final Certificate.
Step Procedures / Tasks Action By
/ Reference
1 Generally
The Final Account must be prepared as soon as is practicable,
after Practical Completion; and
the Contractor has fulfilled his obligations under theContract, which includes the making good of defects
The Contractor is required to submit, not later than 3 monthsafter practical completion, the full particulars of all claims,together with such supporting documents (includingdocuments relating to accounts of Nominated Sub-Contractorand Nominated Supplier, if any) as may be necessary for thepreparation of the Final Accounts.
If the Contractor fails or refuses to submit the informationwithin the time, the Final Accounts may be prepared based onthe information at hand so as to enable the Final Accounts andFinal Certificate to be completed within 3 months after the endof defects liability period or issuance of the Certificate of Completion of Making Good Defects, whichever is the later.
Final Accounts and Final Certificate following Determination
Where the employment of the Contractor was terminated, the
Final Accounts and Final Certificate shall be prepared as soonas practicable after the new contractor is appointed and theassessment of the costs and/or loss or damage to theGovernment/DID is completed. A modified Form JKR66A isused (Final Account After Determination of Employment of theContractor / Perakuan Muktamad Kontrak Yang ManaDitamatkan Pengambilan Kerja Kontraktor).
For procedures following determination, please refer toChapter 16.
For information
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Step Procedures / Tasks Action By
/ Reference
2 Preparation of the Statement of Final Account and FinalCertificate
(a) Adjustment of Contract Sum
Before preparing the Final Account and Final Certificate (formJKR66A), ensure that all adjustments to the Contract Sum areapproved and carried out, i.e. for,
o Adjustment for Prime Cost and Provisional Sumso Re-measurement of provisional quantitieso Variations to the Contracto Assessments of claims by the Contractor.
Ensure that all Variation Orders (APK) and Adjustment of
Contract Sum (PHK) have been issued and are correct.
Ensure that the SO and contractor sign the JKR-APK and JKR-PHK, as the case may be.
Action by: SOR/CAO
Refer to Chapter 12, and the
Checklist for Adjustment of
Contract Sum
(b) Prepare Form JKR66A
Use the current Form JKR 66A.
Ensure that the form is duly filled in with the correct contractdata, and that the sums, adjustments and computation arecorrect.
The Final Account must take into account the following:
All adjustments to the Contract Sum;
Payments previously paid to the Contractor, NominatedSub-Contractor and Suppliers, and assignees; and
Permitted deductions under the Contract, such as costsincurred in connection with employment of others toexecute such works to give effect to an S.O.’s instruction,Liquidated Ascertain Damages (LAD), costs for makinggood defects, etc.
Recoupment of Advance Payment
Deductions for direct payment by DID for dues orcontributions under the Employment Ordinance, theEmployee’s Social Security Act, the Employee’s ProvidentFund Ordinance and any other laws relevant to theemployment of workmen.
The release of Performance Guarantee Sum (if any).
Action by: SOR/CAO
Refer to Checklist for Preparation of
Final Account (Penyedian
Perakuan Akaun Muktamad )
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Step Procedures / Tasks Action By
/ Reference
(c) Supporting Documents
Attach the required supporting documents to the Final Accountand Final Certificate:
Certificate of Practical Completion;
Certificate of Non- Completion; if any
Certificate of Completion of Making Good Defects;
Certificate of Delay and Extension of Time, if any;
Certificate of Adjustment of Contract Sum, if any;
Certificate of Payment of Performance Guarantee Sum, if any;
Payment voucher(s); and
Letter of release from the Department of Labour, orStatutory Declaration (to the effect that workmenemployed have received all wages) made by theContractor**.
**The letter or statutory declaration must be submitted by the
Contractor before the final payment can be effected to theContractor.
Action by: SOR/CAO
(d) Check documents for completeness, and computation
Upon receipt of the Final Account and Final Certificatedocuments:
Check that each document is complete and/or in order.Refer to the Checklist for Preparation of Final Account (Penyedian Perakuan Akaun Muktamad);
Complete and initial the Checklist for Preparation of Final
Account;
The recommending officer shall sign the Form JKR66A; and
Submit Form JKR66A, together with attached documents,to the SO for signature
Action by: SOR/CAO
Refer to Checklist for Preparation of
Final Account (Penyedian
Perakuan Akaun Muktamad )
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
Step Procedures / Tasks Action By
/ Reference
3 Quality Audit
Forward the Statement of Final Account and Final Certificate
for checking (quality audit) by the relevant contract officer.
The quality auditor shall check that the documents are in orderand free of errors.
Action by:CAO/BUBK
4 Approval of Final Account and Final Certificate
The Final Account and Final Certificate must be signed by theS.O..
Action by: CAO/SO
5 Issue Final Account and Final Certificate to Contractor
The Final Account and Final Certificate must be forwarded toContractor and copies distributed to all parties involved in theContract (Accountant General).
It is not a contractual requirement that the Contractor mustsign and return a copy of the Final Account and FinalCertificate.
Action by: CAO
6 Forward documents to the Finance Division
The Final Account and Final Certificate must be forwarded tothe relevant Finance Division to effect payment.
Action by: CAO / FD
7 Prepare Completion Report, etc
As final duties, the SOR/PT are to prepare and submit the
Final (Completion) Report, and Contractor’s Performance Report (if necessary).
Please also refer to Volume 11 – Construction Management.
For information
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
19.3 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference (or sample) documents for the procedures orprocesses outlined in this Chapter.
JKR 66A : Final Account and Final Certificate
Letter of Discharge of Bank / Finance Company / Insurance Guarantee
19.4 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars on Final Account and Final Payment.
Treasury Circular(Surat Pekeliling Perbendaharaan)
Nil
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPS Bil. 2/2000: 2. Pindaan ke atas Borang JKR 66, Perakuan Pelarasan Jumlah HargaKontrak (PPJHK) dan Perakuan Muktamad
3. Pindaan Kepada Syarat-syarat Kontrak Berkaitan Bayaran
[2] SP JPS Bil. 4/2008: Langkah-langkah Untuk Mempercepatkan Bayaran Interim (Tambahankepada Surat pekeliling SP JPS Bil. 2/2000)
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
APPENDIX 19A CHECKLIST FOR THE PREPARATION OF FINAL ACCOUNT
(SENARAI SEMAKAN PENYEDIAAN PERAKUAN AKAUN
MUKTAMAD)
TAJUK
PROJEK
Untuk Tindakan
Nama PegawaiTarikhDiberi
Kepada
TarikhDiterim
aOleh
Tarikh Siap Semakan
PMK 1
PMK 2
AK*
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
1. Pastikan perkara-perkara berikutdipatuhi sebelum penyediaan PerakuanMuktamad disiapkan.
(i) Semua Wang Kos Prima(termasuk layanan dankeuntungan) & Wang PeruntukanSementara telah diselaraskan.
(ii) Semua item untuk KuantitiSementara telah dibuatPengukuran Semula.
(iii) Semua item/kerja yang tidak
dilaksanakan (omission) ataudikurangkan daripada kontrak telah disediakan APK
(iv) Semua APK & PHK telahdiselaraskan.
(v) Pelarasan pengiraan baki untuk VOP telah dibuat.
(vi) Semua tuntutan antarakontraktor dan Kerajaan telahdiselesaikan
Tandakan ()selepassemakan
2. Borang Perakuan Muktamad.
2.1 Pastikan borang JKR 66A yang terkinidigunakan.
Muka surat 1 / 4
2.2 KERAJAAN - bermaksud 'KERAJAANMALAYSIA' bagi projek Persekutuanatau 'KERAJAAN ...............' bagiprojek Negeri.
2.3 Peruntukan pembangunan, kepala dan
pecahan kepala - hendaklah diisi.
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
Muka surat 1 / 4 (samb.)
2.4 Tajuk kerja, nama dan alamatkontraktor hendaklah sama seperti didalam dokumen kontrak.
2.5 No.Kontrak dan Jumlah Harga AsalKontrak hendaklah sama seperti didalam dokumen kontrak.
2.6 Jumlah Bersih Tambahan / Potongan
(i) Ambil Jumlah Bersih dari PenyataPelarasan Harga Kontrak di mukasurat 4/4.
2.7 Harga Muktamad Kontrak adalahHarga Kontrak setelahditambah/dipotong jumlah bersih APK & PHK.
2.8 Perkara A - Butir-butir JumlahPotongan / Kurangan
(i) Perkara A.1 - pastikan semula jumlah bayaran interim yangterdahulu berasaskan baucerbayaran.
(ii) Perkara A.2 - pastikan jumlahsemua bayaran WangPendahuluan, jika ada yangdibuat berasaskan baucerbayaran (termasuk bayaranWang Pendahuluan kepadaNSC/NS).
(iii) Perkara A.3 - Jumlah Potonganlain termasuk bayaran kepadapihak ketiga, jika ada (sertakanlampiran dan keteranganpotongan).
2.9 Bayaran Muktamad Dibawah Kontrak adalah Harga Muktamad Kontrak ditolak dengan perkara A.1, 2 dan 3.
2.10 Tandatangan Pegawai Pengesyorhendaklah pegawai yang diberi kuasadan catitkan nama dan jawatan.
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
Muka surat 1 / 4 (samb.)
2.11 Perkara 'B'
(i) Pastikan amaun dalam perkataan
jumlah sebenar bayaranPerakuan Muktamad.
(ii) Perkara B.1.(ii) - Pastikanketepatan bayaran balik kepadaKontraktor Utama bagi pelepasanDeposit Wang JaminanPelaksanaan. (Jika berkenaan).
(iii) Perkara B.2 - Pastikan ketepatanbaki bayaran kepadaSubkontraktor/Penerima Bayaranseperti di Lampiran A.
(iv) Perkara B.3 - Pastikan ketepatanpengiraan kredit hasil bagi LADberasaskan perbezaan tarikh CPCdengan tarikh Lanjutan Terakhirdan kadar LAD di dalam kontrak.
(v) Perkara B.1.(i) – Pastikanperkiraan nilai kerja dan amaun-amaun lain bagi KontraktorUtama adalah perbezaan antaraBayaran Muktamad dan jumlahPerkara B.1.(ii), B.2 & B.3
2.12 Pastikan Jumlah Bayaran Muktamadmenyamai Bayaran Muktamad diBawah Kontrak.
2.13 Masukkan No. Fasal berkenaan dengan Akuan Statutori mengikut syarat-syaratkontrak berkenaan seperti 48(d) bagiborang JKR 203/203A.
2.14 Tandatangan Pegawai Penguasahendaklah pegawai yang diberi kuasa
dan catitkan nama dan jawatan.
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Chapter 19 – FINAL ACCOUNT AND FINAL CERTIFICATE
BIL. KETERANGAN PMK 1 PMK 2 AK* ULASAN
Muka surat 2 / 4
2.15 Perkara ‘C’
Pastikan pihak kontraktor adalah orangyang sama yang menandatanganikontrak atau wakil lain yang diberikuasa. Tandatangan hendaklahdisaksikan dan dilengkapi dengantarikh serta maklumat diri yangdikehendaki.
2.16 Sebelum Perakuan Akaun dan BayaranMuktamad diluluskan, pastikan perkaradi bawah ini telah dilaksanakan.
(a) Perakuan Siap Kerja telahdikeluarkan.
(b) Surat Akuan Statutori atau Surat Akuan Ketua Pengarah Buruhtelah diterima daripada kontraktordan disertakan bersama.
Tandatangan Pegawai SemakanTarikh Selesai Tugasan:
Tandatangan Pegawai PengesahanTarikh Selesai Tugasan:
Tandatangan Kualiti AuditTarikh Selesai Tugasan:
* Audit Kualiti; Jika Berkenaan
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Table of Contents
Table of Contents .....................................................................................................................20-i
List of Flowcharts .................................................................................................................... 20-ii
20.1 INTRODUCTION.........................................................................................................20-3
20.2 PROCEDURES ............................................................................................................20-3
20.2.1 Administration of Prime Cost Sums..................................................................20-3
20.2.2 Administration of Provisional Sum .................................................................20-11
20.3 GUIDANCE NOTES ...................................................................................................20-16
20.3.1 Definitions ...................................................................................................20-16
20.3.2 Nomination of Sub-Contractors and Suppliers under P.C. Sum ........................20-16
20.3.3 Appointment of Sub-Contractors and Suppliers under Provisional Sums...........20-16
20.3.4 Expending the P.C. Sums..............................................................................20-17
20.3.5 Expending the Provisional Sums....................................................................20-17
20.3.6 Procurement under P.C. Sum and Provisional Sum .........................................20-17
20.4 REFERENCE DOCUMENTS.........................................................................................20-17
20.5 REFERENCES ...........................................................................................................20-19
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
List of Flowcharts
Flowchart Description Page
Flowchart 20.1 Administration of Prime Cost Sums 20-1
Flowchart 20.2 Administration of Provisional Sums 20-2
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Flowchart Description Action By Reference
1. Prime Cost Sums orProvisional Sums areincluded in the ContractSum
-
2. Is it Prime Cost Sum? -
A. Administration of Provisional Sums
- Refer Figure 20.2
3. Prepare TenderDocuments
PT/PO
4 Invitation and Receipt of Tender
PT/PO
5. Tender Evaluation andNomination / Acceptance
PT/PO
6. Sub-ContractDocumentation
PT/CAO
7. Sub-Contract Administration
Commencement Direct Payment SO’s consent
PT/CAO
8. Completion -
Flowchart 20.1 – Administration of Prime Cost Sums
4
5
8
6
7
1
2
A
No
3
Yes
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Flowchart Description Action By Reference
A Provisional Sum isincluded in the ContractSum
- Refer Figure 20.1
1. Prepare cost estimates of works under ProvisionalSum.
CAO/Ir/Sr
2. Is the estimates of works30% more than theProvisional Sum?
-
3. Is the estimates of works50% more than the
Provisional Sum?
-
4. Obtain approval fromDivision Director
CAO /Division Director
Use ‘Borang E’
5. Obtain approval from DGor Deputy DG
CAO/DG /Deputy DG
Use ‘Borang E’
6. Does the work require theinvolvement of the main
contractor?
-
7. Quotation exercise SOR
8. Is it specialist works? -
9. Tender or quotationexercise by Contractor
SOR
10. Issue SO instruction tomain contractor, andprepare valuation of works
SOR/ SO/CAO
11. Obtain approval (on costs)from Authorised Person
CAO /Authorised
Person
Use ‘Borang F’
12. Appointment of sub-contractor or supplier.
Flowchart 20.2 – Administration of Provisional Sums
12
11
1
2
3
5
No
4
6
Yes
No
Yes
9
8
10
7
No
Yes
No
Yes
A
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20 PRIME COST & PROVISIONAL SUMS
20.1 INTRODUCTION
This chapter provides:
The guidelines on expenditure of Prime Cost (P.C.) and Provisional Sums. The guidelines on the preparation of tender documents, contract documents and general
administration of nominated sub-contract and supply contracts.
Note: Refer to Section 20.3 for definitions and general overview on procurement of items underPrime Cost Sums and Provisional Sums.
20.2 PROCEDURES
20.2.1 Administration of Prime Cost Sums
(Nominated Sub-Contractor and/or Nominated Supplier)
Step Procedures / Tasks Action By
/ Reference
1 & 2 Prime Cost Sums
Please refer to Flowchart 20.1 – Administration of Prime CostSums.
Where the Contract specifically permits the nomination of sub-contractor to carry out works included under Prime Cost, or theSO has elected that works under Provisional Sums shall beexecuted by nominated sub-contractor or nominated supplier,then the PT/PO shall carry out the tender exercise forprocurement of sub-contract works.
The Project Team must give due consideration to the overallworks programme, and ensure the timely nomination of sub-contractor or supplier so as to avoid any delay to the works.
The procedures for preparation of tender documents,invitation, receipt, evaluation and acceptance of tenders, sub-contract documentation, payment, variation, delay andextension of time, non-completion, determination, completion,
handing over and defects, and final accounts are similar to thatfor the main contract, and reference should be made toChapters 6 to 19, inclusive.
Changes in points of detail are set out in this chapter.
For information
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
3 Preparation of Tender Documents
The procedures for the preparation of tender documents andtender table documents set out in Chapter 6 are generallyapplicable to the preparation of tender documents and tendertable documents for a nominated sub-contract.
The sub-contract tender document shall follow the maincontract number, with the words ‘NSC’ and the sub-contractworks package number in parentheses appended at the end,eg: JPS/IP/P/1/99(NSC 1).
(a) Generally, the TENDER DOCUMENT FOR WORK comprisesthe documents in the following order:
Tender Notice Instructions to Tenderer Form of Tender (JKR 203N1) Conditions of Contract
(JKR 203N, including amendments and SpecialProvisions)
Relevant Particulars of the Main Contract Specification Summary of Tender and Schedule of Rates; or Bills of
Quantities Schedule of Technical Information List of Drawings
The sample contents page for the tender document is set outin Volume 10A, Chapter 20.
For information
Action by: PT/PO
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Step Procedures / Tasks Action By
/ Reference
3(Cont’d)
Preparation of Tender Documents (Cont’d)
(b) Generally, the TENDER DOCUMENT FOR SUPPLY OFMATERIALS OR GOODS comprises the documents in thefollowing order:
Tender Notice Instructions to Tenderer Form of Tender (JKR 203P 1) Conditions of Contract
(JKR 203P, including amendments and SpecialProvisions)
Relevant Particulars of the Main Contract Specification
Schedule of Prices Schedule of Technical Information
The sample contents page for the tender document is set outin Volume 10A, Chapter 20.
(c) Generally, the TENDER DOCUMENT FOR SUPPLY OFMATERIALS OR GOODS comprises the documents in thefollowing order:
Tender Notice Instructions to Tenderer Form of Tender (JKR 203P 1) Conditions of Contract
(JKR 203P, including amendments and SpecialProvisions)
Relevant Particulars of the Main Contract Specification Schedule of Prices Schedule of Technical Information
The sample contents page for the tender document is set outin Volume 10A, Chapter 20.
Action by: PT/PO
Action by: PT/PO
4 Invitation and Receipt of Tender
The procedures for the invitation and receipt of tender set outin Chapter 7 are generally applicable to the invitation andreceipt of tender for a nominated sub-contract.
Invite the Main Contractor to tender for the sub-contract worksif the Main Contractor is suitably qualified.
Action by: PT/PO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
5 Tender Evaluation and Nomination / Acceptance
(a) Tender Evaluation
The procedures for the tender evaluation and acceptance setout in Chapter 8 are generally applicable to the tenderevaluation of a nominated sub-contract
In the evaluation of tender, the following percentagepreference are applied for specialist bumiputra contractors forsupplies and services:
Value of Work PreferenceWeightage
Exceeding RM100,000 – RM500,000 10%
Exceed RM500,000 - 1.5 million 7%
Exceeding RM 1.5 million – RM 5 million 5%
Exceeding RM 5 million – RM 10 million 3%
Exceeding RM10 million – RM 15 million 2.5%
Exceeding RM15 million No preference
(b) Nomination & Acceptance
Upon the approval of the Procurement Board,
the SO shall issue the Letter of Nomination theContractor and instruct to accept the tender, or
if the Contractor’s tender is accepted, the S.O. shallissue the Letter of Acceptance to the Contractor.
Action by: PT/PO
Refer: SPP 4/1995
Action by: SOR/SO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
5(Cont’d)
Tender Evaluation and Nomination / Acceptance (Cont’d)
(b) Nomination & Acceptance (Cont’d)
Upon the approval of the Procurement Board,
the SO shall issue the Letter of Nomination theContractor and instruct to accept the tender, or
if the Contractor’s tender is accepted, the S.O. shallissue the Letter of Acceptance to the Contractor.
(i) Letter of Nomination
Use the current form for Letter of Nomination:
for nomination of sub-contractor: Form JKR 203N3
for nomination of supplier: Form 203P3
(ii) Letter of Acceptance
Use the current form for Letter of Acceptance of MainContractor’s Tender for work or Supply of Materials orGoods Under Prime Cost Sum, where the Main Contractorshall carry out works allocated under Prime Cost orProvisional Sums.
Use the current and appropriate form for the nomination,notification and/or acceptance, as the case may be.
Action by: SOR/SO
6 Sub-Contract Documentation
The procedures for the preparation of contract document setout in Chapter 9 are generally applicable for the preparation of the sub-contract documents.
The sample contents page for the contract document is set outin Volume 10A, Chapter 20.
Action by: PT/CAO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
7 Sub-Contract Administration
(a) Generally
Generally, the Contractor is fully responsible for the acts of theSub-Contractor/Supplier.
With the exception of payment matters, the Contractor is alsoresponsible for the day-to-day administration of the sub-contract / supply contract, including matters (where applicable)relating to
Variations Delays and Extension of Time
Non-Completion Loss and Expense Determination
The written consent of the SO is required before the Contractormay agree to, or grant, and additional time to the sub-contractor, or to determine the employment of the sub-contractor / supplier, as the case may be.
(b) Direct Payment
Direct payment to nominated sub-contractors and suppliers arepermitted under the terms of the contract and sub-contract,
subject to the following procedures or conditions are fulfilled:
(a) Direct progress payment up to the limit of 90% of Sub-contract Sum
(b) The remainder 10% of the Sub-contract Sum shall be paidto the Main Contractor after the issuance of the Certificateof Practical Completion. The PT shall ensure that the MainContract releases the remainder sums to the Sub-Contractor after the Defects Liability Period.
(c) Ensure that the conditions for direct payment are included
in the tender documents and the sub-contract.
(d) The sub-contractor is registered as bumiputra contractorunder the relevant class, and is a local contractor operatingat the area where the project is to be carried out.
For information
Action by: PT/ CAO/Finance Division
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
7(Cont’d)
Sub-Contract Administration (Cont’d)
(b) Direct Payment (Cont’d)
(e) Ensure that the conditions for direct payment are stated inthe Letter of Acceptance (LoA) to the Main Contractor, andthat the Main Contractor submits the a complete list of sub-contractors he intents to employ.
(f) Ensure that there is no assignment of payments to others,other than the sub-contractors listed by the MainContractor.
(g) The Main Contractor is not permitted to amend the list of
sub-contractors without written permission of theGovernment/DID.
(h) The main contract includes an indemnity clause tosafeguard the rights of the Government / DID.
(c) Written Consent of the S.O.
The written consent of the SO is required before the Contractormay carry out any of the following under the terms of the sub-contract:
Permit sub-contractor’s to employ workmen not in
accordance with Government’s prescribed ratio (clause12(b))
Permit Sub-letting (clause 19) Grant extension of time (clause 26(b)) determine the employment of the sub-contractor (clauses
28(a) and (b)). employ others or himself undertake the sub-contract work
following the determination of the nominated sub-contractor (clause 28(c)(ii)).
Action by: PT/ CAO/Finance Division
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
7(Cont’d)
Sub-Contract Administration (Cont’d)
(c) Written Consent of the S.O. (Cont’d)
In addition to the above, the S.O.’s certificate is required forthe following:
a certificate, stating the nominated sub-contractor’s default,be issued by the S.O. prior to calling of performance bondby the Main Contractor (clause 24(b))
a certificate, stating that the nominated sub-contractor is indelay, prior to deduction for loss or damages by the MainContractor (clause 27).
(d) Default on the Part of the Sub-Contractor / Supplier
Where the Nominated Sub-contractor or Supplier in theexecution of the work or the supply of the materials or goodsunder the sub-contractor, the Main Contractor shall beresponsible to have the works executed or the materials orgoods supplied by whatsoever means necessary.
The Government/DID is not required to re-nominate. Thecontractor is only entitled to be paid the same sum as if theNominated Sub-contractor or Supply had not defaulted, andthe contractor is not entitled to extension of time by reasons of such default.
Action by: PT /SO
For information
7 & 8 Commencement and Completion of Sub-Contract Works
The Main Contractor shall issue an Official Order to Commence,using form JKR 203N5, and the Nominated Sub-Contractor isrequired to complete the works within the time for completionstated in its Form of Tender.
Nominated Supplier
The Main Contractor shall issue an Order For Supply andDelivery of Articles, using form JKR 203P5, and the Nominated
Supplier is required to complete the supplies within the timefor completion stated in its Form of Tender.
Defects Liability
Refer to the Main Contract for defects liability obligations andrights.
For information
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.2.2 Administration of Provisional Sum
Step Procedures / Tasks Action By
/ Reference
A Provisional Sums
Please refer to Flowchart 20.2 – Administration of ProvisionalSums.
The Project Team must give due consideration to the overallworks programme, and ensure the timely appointment of sub-contractor or supplier so as to avoid any delay to the works.
1 Preparation of Cost Estimates
Prepare cost estimates for the works to be carried out undereach Provisional Sum.
At this stage, the scope of works shall have been sufficientlyclearly identified or defined to enable the works to be priced.
The cost estimate for the works shall be prepared by anofficer who has the relevant experience or expertise.
Action by: CAO
2 Approval Before Proceeding with Procurement
Approval of the Authorised Person is required if the estimatedcost of works for each Provisional Sum exceeds thatProvisional Sum by more than 30%.
Use the current ‘Borang E’ – Permohonan Permohonan Untuk Melaksanakan Item Di Bawah Wang Peruntukan Sementara Yang Dijangka Melebihi *30%/50% Dari Peruntukan Asal..
Action by: CAO
JPS SP Bil 1/2007
3, 4 & 5 Authorised Person
If the estimated cost of works exceeds the Provisional Sumby more than 30% up to the limit of 50%, the AuthorisedPerson shall be the Division Director.
If the estimated cost of works exceeds the Provisional Sumby more than 50%, the Authorised Person shall be theDirector General or Deputy Director General.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
6 & 7 Procurement of Works Not Requiring Involvement of the MainContractor
If the works do not require the involvement of the Contractor(eg aerial photography or works carried out off-site), thenproceed to invite tender/quotation directly from qualified sub-contractors or suppliers.
Comply with the DID guidelines on calling of tender/quotation.
Direct payment may be to such sub-contractor or suppliermay be effected through Indent or Local Purchase Order(Inden / Pesanan Tempatan).
Action by: SOR/CAO
For information.
8 & 9 Works To Be Carried Out By Specialists – Calling of Tender/Quotation By Contractor
For specialist works exceeding RM200,000, open/selectivetender shall be called by the Contractor.
For works value not exceeding RM200,000, work may beprocured by the Contractor through quotation exercise.
The Contractor may tender/quote for the specialist works, if has the necessary qualifications. In such cases, theContractor shall not be entitled to profit and attendance on histender/quotation.
For information
Contractor shall prepare and call tender/quotation
The SOR/PT shall prepare specifications, Needs Statement,or design (‘design documents’), and provide the same tothe Contractor.
Design and Build. For DB contracts, the Contractor shallprepare the specifications, Needs Statement or design(‘design documents’) for the tender/quotation documents.
The Contractor shall prepare the tender/quotationdocument based on the design documents, and providethe list of suitably qualified sub-contractors or suppliers(‘tenderers’) for the SOR’s approval.
The SOR/PT must check the tender/quotation documentsare in order and free from errors. The SOR shall provide alist of suitably qualified tenderers.
To total number of tenders shall not be less than 5,selected from both the lists provided by Contractor and theSOR.
Action by:SOR/PT
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
8 & 9(Cont’d)
Works To Be Carried Out By Specialists – Calling of Tender/Quotation By Contractor (Cont’d)
Contractor shall prepare and call tender/quotation (Cont’d)
The Contractor shall prepare sufficient number of tenderdocuments.
For quotations, the tenderers must submit 2 set of documents.
Action by:SOR/PT
Closing of Tender/Quotation
The SOR shall prepare and issue the invitation for
tenders/quotations.
The tenders/quotations shall be closed on the fixed dateand time.
The quotations/tenders shall be opened in the presence of a committee, comprising representatives of the SOR andContractor.
Evaluation of Tender/Quotation
For tenders, the evaluation shall be carried out by the
SOR, and the SOR shall recommend the lowest andtechnically complying tender.
Design and Build. For DB contracts, the evaluation shallbe carried out by the Contractor, and the Contractor shallrecommend the lowest and technically complyingquotation.
For quotations, the evaluation shall be carried out by theContractor, and the Contractor shall recommend the lowestand technically complying quotation.
(a) The SOR shall verify the recommendation, and mayfurther negotiate for a fair sub-contract sum orcontract rates.
(b) The sub-contract sum or contract rates shall beinclusive of the Contractor’s Profit and Attendance.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
8 & 9(Cont’d)
Works To Be Carried Out By Specialists – Calling of Tender/Quotation By Contractor (Cont’d)
Profit and Attendance (P&A)
The Profit and Attendance (P&A) shall be inclusive of Contractor’s management costs, profit and attendance.
For Quotation, the Contractor’s P&A shall be as stated inthe Contract or, if not stated then, it shall not exceed7.5%.
For Tender, the Contractor’s P&A shall be as stated in theContract or, if not stated then, it shall not exceed the
following rates:
Value of Works Maximum Rate for P&A
RM500,000 or less 7.5%
> RM500,000 – RM 1 million 5%
> RM 1 million - RM 5 million 4%
> RM 5 million – RM 10 million 3%
> RM 10 million <3%
If the Contractor’s tender/quotation is accepted, theContractor shall not be entitled to profit and attendance onhis tender/quotation.
10 Works To Be Carried Out By Main Contractor
For normal category of works (‘kategori biasa’), or workswhich the Contractor possesses the necessary skills, the SOmay issue the necessary SO Instruction for the Contractor tocarry out the works.
The valuation of works shall be in accordance with thevaluation rules of the Contract, i.e. based on contract rates or,in the absence of contract rates, based on fair valuation.
Action by: SOR / SO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Step Procedures / Tasks Action By
/ Reference
11 Approval of Value of Works
The tender/quotation evaluation and recommended sub-contract / supply contract value shall be approved by a
Variation Order Committee (‘Authorised Person’).
The sub-contract / supply contract value shall be inclusive of the Contractor’s Profit and Attendance.
Submit the application for the approval of sub-contract value /supply contract value to the Authorised Person for approval.
Use the current ‘Borang F’ – Permohonan Untuk Kelulusan Harga Bagi Item Wang Peruntukan Sementara .
See Chapter 5 – Authority for Authorised Person, and limit of authority
Action by: SOR
12 Appointment of Sub-Contractor or Supplier
SO’s Instruction
Issue the necessary instruction to the Contractor to effect theappointment of the sub-contractor or supplier, as approved bythe VO Committee.
Direct Payment and Deed of Assignment
The DID may make direct payment to such sub-contractor orsupplier through the execution by the Contractor of the ‘Deedof Assignment’ (Surat Ikatan Penyerahan Hak Faedah), infavour of the appointed sub-contractor or supplier.
For avoidance of disputes, a copy of the Deed of Assignmentshall be appended to the SO’s Instruction for the appointmentof sub-contractor or supplier.
The Deed of Assignment may be used if there is nooverlapping of sums which is assigned under the main
contract.
Form JKR 203N
For works let under Form JKR 203N, direct payment to thesub-contractor shall be effected through the procedures forNominated Sub-Contractor or Nominated Supplier (see Section20.3.2, above).
Action by: SOR/SO
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.3 GUIDANCE NOTES
20.3.1 Definitions
"Nominated Sub-contractor" means any contractor, specialist or other person nominated by the S.O.
in accordance with the Contract to be employed by the Contractor for the execution of work orsupply of goods materials or services for which a Prime Cost Sum (or P.C. Sum) has been inserted inthe Contract or ordered by the S.O. to be employed by the Contractor to execute work or supplygoods materials or services under a Provisional Sum.
“Prime Cost Sum” or “P.C. Sum” is an amount included in a bill of quantities to cover a particular bitof work or supply of materials to be carried out by a nominated sub-contractor or a supplier.
Generally, P.C. Sums are included in the Contract for works to be carried out by specialist contractorsor suppliers.
"Provisional Sum" means a sum included and so designated in the Contract as a specific allocation
for the execution of work or the supply of goods materials or services which may be used in whole orin part or not at all at the direction and discretion of the S.O..
Generally, Provisional Sum are allocated for the execution of works or for supply of goods or servicesfor which
an exact price cannot be obtained/ascertained or are not clearly identified or defined
at the time of tender.
20.3.2 Nomination of Sub-Contractors and Suppliers under P.C. Sum
The contract may permit the Government / DID to nominate a sub-contractor to carry out work or asupplier to provide goods which is included under any Prime Cost or Provisional Sum.
The Forms JKR203 and 203A includes such right of nomination, whereas Form JKR DB/T does not.
Under the JKR Forms 203/203A, any work or supply of goods or materials covered by ProvisionalSums may be treated as P.C. Sum items if the S.O. so decides.
20.3.3 Appointment of Sub-Contractors and Suppliers under Provisional Sums
The sub-contractor or supplier may be appointed by the Contractor pursuant to the S.O.’s Instructionon the expenditure of Provisional Sums. The sub-contractor or supplier is not a nominated sub-
contractor or nominated supplier pursuant to the terms of the Contract.
The DID may make direct payment to such sub-contractor or supplier through the execution by theContractor of the ‘Deed of Assignment’ (Surat Ikatan Penyerahan Hak Faedah), in favour of theappointed sub-contractor or supplier.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.3.4 Expending the P.C. Sums
The tender evaluation report (kertas taklimat tender) for the sub-contract must be submitted to theTender Board for approval.
Please also refer to Chapter 5 – Authority, and Chapter 8 – Tender Evaluation and Acceptance.
20.3.5 Expending the Provisional Sums
If the estimated cost of works is expected to exceed the Provisional Sum by 30% or more, then theProject Team must seek prior approval from the Authorised Person prior to the expenditure of theProvisional Sum.
The valuation or prices for the sub-contract or suppler must be submitted to the Authorised Personfor approval prior to the appointment of the sub-contractor or supplier.
If the estimated cost of works does not exceed the Provisional Sum, or exceeds the Provisional Sum
by less than 30%, the Project Team may proceed with the procurement and seek approval of the Authorised Person prior to the appointment of the sub-contractor or supplier.
20.3.6 Procurement under P.C. Sum and Provisional Sum
The PT/PO shall carry out the
tender exercise, or quotation exercise (as the case may be),
for the sub-contract works, where such Prime Cost Sums or Provisional Sums are included in theContract.
20.4 REFERENCE DOCUMENTS
Please refer to Volume 10A for the standard reference or sample documents for the procedures orprocesses outlined in this Chapter.
Nominated Sub-Contractor
JKR 203N/83 (including addendum) : Form of Contract To Be Used For Nominated Sub-Contractors Where the Main Contractor is Based Upon Form JKR 203 Or 203A
JKR 203N1/83 (including addendum) : Form of Tender For Use by Nominated Sub-Contractor
JKR 203N2/88 : Conditions of Tendering and General Information For Use By Nominated Sub-Contractor
JKR 203N3/93 : Letter of Nomination
JKR 203N4/83 : Letter of Acceptance of Tender By Main Contractor To Nominated Sub-Contractor
JKR 203N5/83 : Official Order to Commence Work By Main Contractor To Nominated Sub-Contractor
JKR 203N6/88 : Letter of Nomination of Sub-Contractor
JKR 203N7/88 : Letter of Indemnity From Nominated Sub-Contractor to the Government
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
Nominated Supplier
JKR 203P/83 (including addendum) : Form to be used for Nominated Suppliers Where The MainContractor is based upon Form JKR 203 or 203A
JKR 203P1/83 : Form of Tender For Use By Nominated Suppliers
JKR 203P2/83 : Conditions of Tendering And General Information For Use by NominatedSuppliers
JKR 203P3/83 : Letter of Nomination
JKR 203P4/83 : Letter of Acceptance of Tender by Main Contractor To Nominated Supplier
JKR 203P5/83 : Order For Supply and Delivery of Articles – to be issued by Main Contractor tothe Nominated Supplier
JKR 203P5A/83 : Schedule of Articles Ordered To Be Supplied and Deliverd
JKR 203P6/88 : Letter of Notification of Nomination of Supplier
JKR 203P7/88 : Letter of Indemnity From Nominated Supplier to the Government
Generally
Bank Guarantee Form for Performance Bond (Nominated Sub-Contract Works)
Deed Of Assignment (Security For Direct Payments To A Third Party)(Surat Ikatan Serah Hak)
The Consent Of The Government Of Malaysia To The Deed Of Assignment For Direct Payment To A Third Party
Expending Provisional Sum
‘Borang E’ – Permohonan Permohonan Untuk Melaksanakan Item Di Bawah Wang PeruntukanSementara Yang Dijangka Melebihi *30%/50% Dari Peruntukan Asal.
‘Borang F’ – Permohonan Untuk Kelulusan Harga Bagi Item Wang Peruntukan Sementara.
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
20.5 REFERENCES
Please refer to the latest Treasury Circulars and DID Circulars for sub-contract tender procedures andsub-contract administration.
Treasury Circular(Surat Pekeliling Perbendaharaan)
[1] Bil 4 Tahun 1995: Dasar dan Keutamaan Kepada Syarikat Bumiputra Dalam Perolehan Kerajaan
[2] Bil 4 Tahun 2003: Bayaran Terus Kepada Sub Kontraktor
[3] Bil 5 Tahun 2007: Tatacara Pengurusan Perolehan Kerajaan Secara Tender
DID Circulars(Surat Pekeliling / Edaran JPS)
[1] SP JPS Bil 4/2003: Bayaran Terus Kepada Sub Kontraktor
[2] SP JPS Bil /2007: Garis Panduan Pengurusan Wang Peruntukan Sementara (WPS)
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Chapter 20 – PRIME COST & PROVISIONAL SUMS
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Table of Contents
Table of Contents .....................................................................................................................21-i
List of Flowcharts .................................................................................................................... 21-ii
21.1 INTRODUCTION.........................................................................................................21-2
21.2 PROCEDURES ............................................................................................................21-2
21.3 REFERENCES .............................................................................................................21-6
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
List of Flowcharts
Flowchart Description Page
Flowchart 21.1 Dispute Management and Resolution 21-1
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Flowchart Description Action By Reference
1. Disagreement ordifference of opinion orconflict or dispute?
-
2. Determine if there is a ‘dispute’.
PT
3. To use best endeavour toresolve the ‘issue’ amicably
PT
4. Issue(s) are settled? -
5. Refer the dispute to the Authorised Party fordecision
PT / CQS
6. Parties to give effect to
Authorised Party’sdecision.
PT
7. Is there new informationor substantiation from theContractor?
-
8. Contractor gives notice torefer dispute toarbitration?
-
9. Refer the dispute to Legal Adviser at Ministry / A.G.’sChamber for advice andaction.
Director of Contracts & QSDivision
Flowchart 21.1 – Dispute Management and Resolution
Yes
No
1
2
5
7
Yes
No
9
4
No
3
6
End
8
Yes
No
Yes
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
21 DISPUTE MANAGEMENT AND RESOLUTION
21.1 INTRODUCTION
This chapter provides:
An overview of the dispute management and resolution procedures for works contracts. Brief outline of alternative dispute resolution (‘ADR’).
21.2 PROCEDURES
Please refer to Flowchart 21.1 – Dispute Management and Resolution.
Step Procedures / Tasks Action By
/ Reference
1 Generally
Disagreement or difference of opinion or conflict or disputeoften occurs in projects.
The best form of dispute avoidance is the ensure that theappropriate procurement method and form of contract isused, and that the scope of works is clearly and accurately setout in the tender and contract documents.
If practicable, all disagreements or differences of opinion orconflicts should be resolved as soon as possible to avoid anyescalation of the issues into a ‘dispute’.
In dispute management, contemporaneous and completerecords are of utmost importance. Therefore, the PT mustensure that records are properly kept and updated, andavailable when required. (See Volume 11).
For the purpose of this Manual, a ‘dispute’ is deemed to haveoccurred when the disagreement or difference of opinion etchas been formally referred by the Contractor to the
Authorised Party under the terms of the contract.
All other issues (i.e. disagreements or differences of opinion
or conflicts) should be resolved by way of negotiation oramicable settlement as soon as practicable.
For information
2 Ascertainment of ‘Dispute’
Ascertain if there is in actuality a “dispute”, whereby theparties must comply with the contractual procedures andarbitration clause.
Action by: SOR / PT
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Step Procedures / Tasks Action By
/ Reference
3 & 4 Amicable Settlement
Unless the ‘dispute’ is formally referred for a decision in
accordance with the contract, the PM/PT should use its bestendeavour to resolve the matter by way of negotiation oramicable settlement.
Upon settlement, record the agreement reached by theparties. This avoids future disagreement on the same issue.
Follow up with the relevant adjustment (if any) to the contractby way of extension of time, Variation or adjustment to theContract Sum, etc, as the case may be.
If parties are not able to make an amicable settlement, then
any party may refer the matter to the Authorised Party underthe Contractor for a decision.
Action by: SOR/PT
5 Referral of Dispute for Decision
If either party has submitted a formally referred the ‘dispute’ to be decided by the Authorised Party:
(a) Upon receipt of the Contractor’s formal request torefer the dispute to the Authorised Party, the PM/PTmust notify the Contracts and Quantity SurveyingDivision immediately.
Action by: SOR/PT
(b) Upon receipt of the Contractor’s formal request torefer the dispute to the Authorised Party, the PM/PTmust notify the Contracts and Quantity SurveyingDivision immediate.
Action by: SOR/PT
(d) The PT shall prepare the documents setting out thebackground of the dispute, with sufficient details forthe Authorised Party to make a decision.
Action by: SOR/PT
(c) The Contracts and Quantity Surveying Division shallrefer the dispute to the officer authorized under the
contract (Authorised Party) to make a decision.
Contracts and Quantity Surveying Division, whereappropriate to do so, shall advise and assist the
Authorised Party in the dispute resolution process.
Action by:BUBK
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Step Procedures / Tasks Action By
/ Reference
(e) The Authorised Party is required to make a decisionwithin the time frame stipulated in the contract.
(f) The Authorised Party may refer the dispute to theClaim Committee for a decision.
For ex-gratia payments, the Claim Committee willrefer the matter to Treasury for decision and/orapproval.
Action by: AtP/ Claims
CommitteeRefer: Treasury Instruction 202
(AP202)
JKR Forms of Contract
For the contracts based on the JKR forms, the time frame forthe S.O. to give a decision is 45 days after the Contractor’s
request for such decision.
Other Forms of Contract
If the contract is not based on JKR forms of contract, pleaserefer to the appropriate provision in the contract for thedispute reference procedures.
For information
For information
6 Compliance with Decision
Comply with the decision of the Authorised Party.
(If the Contractor is dissatisfied with the Authorised Party’s
decision, he must nevertheless comply with the decision butmay refer the dispute for arbitration.)
Follow up with the relevant adjustment (if any) to the contractby way of extension of time, Variation or adjustment to theContract Sum, etc, as the case may be.
Action by: SOR/PT
7 Authorised Party May review its own Decision
If
the Contractor is dissatisfied with the decision of the Authorised Party, and
new information or substantiation has come into theattention of the Authorised Party,
then the Authorised Party may review its earlier decision, orrefer such review (of earlier decision) to the Claim Committeefor confirmation.
Action by: AtP
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Chapter 21 – DISPUTE MANAGEMENT AND RESOLUTION
Step Procedures / Tasks Action By
/ Reference
8 Notice of Arbitration
The Contractor may refer the dispute for arbitration if
The Authorised Party fails to give a decision within 45 daysafter being requested to do so; or
The Contractor is dissatisfied with the decision of the Authorised Party.
Such requirement to refer the dispute to arbitration must bemade within the period stipulated in the contract.
Generally, the arbitration shall not commence until after thecompletion or alleged of the completion Works, ordetermination or alleged determination of the employment of
the Contractor, except for the followings:
Where there is written consent of the Government/DIDand the Contractor; or
For such dispute following the effect of war or earthquake.
Other Forms of Contract
The above procedure is made in reference to the JKR forms.If the contract is not based on JKR forms of contract, pleaserefer to the appropriate provision in the contract for theprocedures on reference to arbitration.
For information
9 Reference to Legal Adviser at Ministry / A.G.’s Chamber
Upon receipt of the Contractor’s notice to refer a dispute forarbitration (whether or not prior reference was made to the
Authorised for a decision), the PM/PT must notify theContracts and Quantity Surveying Division immediately.
The Contracts and Quantity Surveying Division shall refer thematters to the Legal Adviser at the Ministry for further adviceand action.
The matter may then be referred to the Attorney General’s
Chamber by the Legal Adviser.
The PT shall compile the records and supporting documentsrelevant to the dispute and as may be required for the arbitralproceedings.
Action by:SOR/PT/BUBK