Bill Of Quantities (BOQ): Types, Purpose, Benefits & Uses

A bill of Quantities, or BoQ, is a list of the individual elements that comprise an engineering, manufacturing, or construction project, along with their precise numbers and descriptive names.

Types Of Bill Of Quantities

For building, engineering, and industrial projects, the traditional and tried-and-true method of obtaining a lump-sum pricing is to employ Bill of Quantities in support of a contract.

Bill of Quantities (BoQ) may be:

Approximate (open to revision as built)

or

Firm (to achieve a lump-sum price for a completely designed project).

Firm BoQ

The Firm Bill of Quantities presents a more accurate assessment of the quantities required for the project. The more accurately the quantities are provided (that is, the more precisely the work is measured and documented), the more reliable the tender price will be.

Theoretically, in the event that the design remained unchanged, a firm’s bill of quantities (BoQ) during the tender stage would match the total cost. Changes are inevitable in practice, and the BoQ offers a solid foundation for cost control because the actual cost of a change can be evaluated in relation to the BoQ rates.

The BoQ is a greater tool for financial control, the firmer it is.

Approximate Bill of Materials:

Approximate BoQ are used when a firm BoQ cannot be prepared because of inadequate detail or when the employer determines that the time and expense of a firm BoQ are not justified.

These contracts do not offer a fixed price; instead, tender price totals (i.e., a quantified schedule of rates) are provided because the quantities are subject to revision by the quantity surveyor/cost manager after the work is finished.

These contracts should only be utilized in situations where time is of the essence or where there is a large deal of uncertainty surrounding specific features, including major excavation and earthworks, as they are typically more variable than lump sum contracts.

Although the initial resource cost of an approximate BoQ is probably less than that of a firm BoQ, the overall resource cost is always higher due to the requirement for re-measurement.

The task items should have accurate descriptions even though the quantities are approximate.

Purpose/Goal/Aim Of Bill of Quantities (BOQ)

When a contract has been entered into, the main goals of a Bill of Quantities (BoQ), which becomes a contract document, are to: i. provide a basis for the valuation of work executed for the purpose of making interim payments to the contractor; and ii. provide a basis for the valuation of varied work. • provide a coordinated list of items, along with their identifying descriptions and quantities, that comprise the works to enable contractors to prepare tenders efficiently and accurately.

Benefits/Uses Of Bill Of Quantities (BOQ)

Regardless of the contract strategy employed, at some point during the procurement process, one of the parties involved—the employer, the main contractor, the work package contractors, or the employer’s quantity surveyor/cost manager—will need to estimate the scope of the work that needs to be done in order to get an estimate for the cost of finishing engineering, building, or industrial projects; to value the amount of work completed for payment purposes; to support applications for tax or other financial incentives; or for any combination of these reasons.

Therefore, there are several advantages to using comprehensive measurement in the production process of Bill of Quantities (BoQ.

The following are some of the advantages/benefits of BoQ:

1) It offers a very strong foundation for budgetary control and accurate cost reporting of the contract (i.e. post contract cost control), including:

(a) The preparation of cash flow forecasts

(b) A basis for valuing variations, and

(c) A basis for the preparation of progress payments (i.e. interim payments).

2) It saves the time and money of multiple contractors measuring the same design in order to calculate their bids for competition.

3) It provides a consistent basis for obtaining competitive bids.

4) It provides an extensive and clear statement of the work to be executed.
5) It permits reconciliation and any required transfers and cost plan modifications after BoQ items are codified;

6) In terms of pricing, it offers information to support claims for grants, capital allowances, and value added tax (VAT), among other tax benefits. In terms of real-time cost data, it is one of the best sources available. It can also be used to estimate the cost of upcoming construction, engineering, and industrial projects, providing historical cost information by providing a cost model in a single document.