An Initiative by IIT Delhi Alumni

Techno-Commercial Audit of Real Estate Construction Projects

Techno-Commercial Audit of Real Estate Construction  Projects

Construction Audit is the process involved detail study and analysis of Project details, documents, development plans, various contract conditions, tax liability, cost structures,  expenses, procurement, change order, value engineering, qualities, safety, statutory requirement, project requirement along with other internal and external constraints are examined thoroughly to establish control system to avoid cost and time overrun and to strengthen working relationship between owners, contractors, suppliers, consultants and other project participants. The techno commercial project audit helps to avoid litigation, manage risk, optimise opportunities, improve performance, focus on strengthening financial controls over the process,  ensure  correctness, effectiveness,  efficiency and contract compliance of projects.

I. Key learning objectives

a)       Define construction project audit objectives

b)       Identify construction techno financial risk

c)       Administration, operation  and support functions

d)       Review of periodic statutory compliances

e)       Review of project control statements

II. Builders Land Ownership

a)       Land Registration

b)       Payment Receipt

c)       Land transfer in revenue records ( Mutation)

III. Land in collaboration

a)       Agreement with Land owner for the specific development

b)       NOC

c)       Payment Records

d)       Development Schedule

IV. Project Approval

a)       Land use change

b)       Land development License as per Master plan and sector plan

c)       Payment to Govt. / Local authority the approval fee : EDC, IDC, Infrastructure development and all other charges

d)       Master Layout plans

e)       Building Plans, elevations, sections, Infrastructure development plans

f)        Height Clearance

g)       Road Connection access

h)       Sewer Connection

i)         Water Connection

j)        Grid Power Connection

k)       DG approval

l)         Lift approval

m)     Boiler Approval

n)       Gas bank Approval

o)       Fuel Oil Tank Storage Approval

p)       Environment Clearance

q)       Pollution Control Clearance

V. Construction Planning, Execution & Management

Project Monitoring through regular physical inspection of completed project work, Review project schedules, Charting of delays, Review of project cost monitoring mechanism, Materials covering purchase and movements, Procurement of building services, Implementation of the (construction) project/outflow of funds, Claims management, project planning scheduling & monitoring, contract appraisal, change and supplement management with the study of milestone activities as below :

1)       Architectural Drawings

2)       Structural Drawings Design

3)       Plumbing Fire Drawings

4)       Electrical, HVAC, Fire detection drawings

5)       IT, Telecom, cctv, TV Network

6)       Solar & Non Conventional energy drawing

7)       Landscape plans

8)       Horticulture plans

9)       Working drawings

10)   Progress Reports

11)   Design calculations

12)   Tender Documents : BOQ, Specifications, Terms & Conditions

13)   Construction Schedule

14)   Material Procurement plans

15)   Inventory Control

16)   Topographical survey

17)   Soil test

18)   water test

19)   Site leveling

20)   Checking of structural drawings and calculations

21)   Checking of working drawings with approved drawings

22)   Area calculation and compare with approved area

23)   Layout check along with land boundaries and set backs

24)   Basement excavation levels

25)   Soil stacking & disposal

26)   Level checking

27)   Raft casting with provision of sump, lift well, drains

28)   Basement Footing, column slab costing with necessary openings, stairs

29)   GF & Upper floor slab casting

30)   Brickwork & block work

31)   Water proofing work

32)   Internal & External electrical works

33)   Internal & External Plumbing work

34)   HVAC work

35)   Landscape work

36)   IT & Telecom work

37)   CCTV & Security system

38)   Fuel Oil storage

39)   Gas bank

40)   Building Automation

41)   Flooring, cladding, Tile & Stone work

42)   Road, walkways  and traffic circulation

43)   Lighting plan

44)   Water bodies, fountain

45)   Finishing work

46)   Signage plan

47)   Installation of Plants & equipment

48)   Testing & Commissioning activities

49)   As build drawings

50)   Operation Manual

51)   Completion & Project Handover

“It is imperative to understand the significance of thorough Audit at the project initiation, periodic and final review on project completion and handing over with establishing concrete project implementation system to avoid or minimise the chances of cost & time overrun and to achieve  the most appropriate sustainable development.”

Note : The above typical points are indicative whereas the actual scope of activities can be workout based on local norms, type of project, location, scope of work, contract conditions  and other related parameters.

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