The construction industry in the State of Kuwait has recently witnessed a rapid growth as the volume of construction projects increased significantly over the past decade. Because of the progress and growth of the industry and the size of the projects, the volume of disputes between the parties to the various contracts has increased accordingly. As projects become larger and more complex, their management and control become more difficult, especially in the absence of effective standard systems to for managing project progress and determining the delay, if any. Even the simple issues, as well as the large ones, if neglected and unaddressed in a timely manner, can cause huge problems that concerns to all project parties. Irrespective of addressing and managing construction delays legally, the resulting legal disputes always have other negative effects on the contracting parties. If the parties to the contract have an insight that enables them to forecast and identify the issues that may cause a conflict before it occurs, that eliminates a myriad of problems before they occur, and greatly reduces the chances of further conflict between contracting parties. This paper presents a framework for a novel progress reporting system that can help minimize contract disputes in the state of Kuwait.
Cash flow is considered to be the main acceleration’s factor of any construction contract, which has a large and direct impact on projects completion dates as well as the project contractual duration. This is very evident when examining how the owners benefit from their projects in achieving or forfeiting the desired economic feasibility determined in the feasibility study of any project.It is noted that the cash flow plan is issued through a Critical Path Method (CPM) for a project which entails only an estimate of the monetary value of the construction work to be carried out on site and on a rough and approximate basis using the cash flow’s curve (S-CURVE), which is usually gives a different value from the actual work performed onsite.The impact of this problem on financial management for any project is as follows:In the case of underestimation, if the available estimates are less than the required cash flow, it is considered as a major cause for delay in project completion as well as the inability of the owner to achieve the economic feasibility Internal Rate of Return (IRR) required for the project. Also, this leads to monitory error due to the financial compensations due to the contractor as a result of the damage caused by time extensions due to the holdings of the cash entitlements.In the case of overestimation of the value of the required cash flow with a high margin of error, this leads to the monetary waste of amounts that could have been invested in other ventures, projects or opportunities.This paper provides a summary of the importance of determining the appropriate amount of cash flows required to be provided by the owner’s financial management, which leads to achieving the appropriate projects financial management gains and thus reducing financial losses or disputes in construction projects in the State of Kuwait.
To paraphrase the Greek philosopher Heraclitus, change is the only constant in construction projects. Changes in scope occur as projects progress from design through practical completion. FIDIC General Conditions Clause 13 [1] is one of the most important terms and implementing. It is also major factor for project success. Once all project parties understand and fairly use this clause, the impact will be minimising the expected disputes by 50% at least. Thus, this paper is considering illustrated variation order clause by flow chart technique to ensure that all the engineers are handling easily those subclasses. KeywordsVariation Order, FIDIC, VO, Change Order, Clause 13 Once all the contract parties got the same perception for the variation order, the minimum dispute will occur. This is our aim from this paper. Research Objective Variation OrderThere are only two facts in life: Death and Changes. Just like death, changes are going to occur by any means, so you have no choice other than accepting them and going along with the flow. In the construction industry, the owner protects How to cite this paper: Kotb, M., Razik, M.I
For any international construction project, Contract is one of the major documents for construction industry. FIDIC General Conditions are the most common used all over the world. Payments term is very important clause and all the project team members need to be aware completely about it. Thus, this paper is considering illustrated payments clauses by flow chart technique to ensure that all the engineers are handling easily those terms.Without real understanding of those clauses usually the project will get cash flow tribbles.
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