Throughout the life cycle of design and construction projects, there are a multitude of costs – many of which are legitimately impacted by changes in the means and methods of performing the work or by changes to the project scope. However, costs can also be manipulated to hide the true financial status of the contract and the work throughout the life cycle of a construction project.

We have experience with contract compliance and other financial elements spanning the life cycle of design and construction projects. We apply a phased approach with à la carte options to customize our work scope to specific client needs.

Our Services

Contract Negotiation

We assist in negotiating and developing contracts for design and construction to ensure the language contained in the agreements is consistent and fair. We evaluate and provide recommendations surrounding financial, audit, and billing terms and requirements of contracts for design and construction.

Policy and Procedures for Cost Control

We provide financial advisory/consulting services to address and manage contractual and financial elements in the design and construction of capital projects, including evaluation of and recommendation for capturing data and preparing billings in accordance with various requirements of the applicable contracts. We work with the parties to establish an ongoing, real-time review program that identifies contract billing discrepancies, contract application variations, and other problems while they are still manageable.

Contract Compliance Review

Our team reviews invoices and verifies that contract billings comply with specific components of applicable design and construction contracts. The process involves testing and reviewing billings to ensure the design and construction team are capturing and maintaining data, and preparing payment applications, in accordance with the contract terms. Our review, analysis, and testing are designed to address billing and compliance issues early, and to assist with reaching payment resolution.

Monthly Payment Application Review

We provide monthly review and testing of billings and supporting documentation submitted by the design and construction team in accordance with applicable contract terms by testing the billings submitted to supporting accounting and project records. Our process includes:

• Testing the billing to prior billings and any unresolved issues identified in prior cost audits/billing reviews
• Determining billed elements not supported through project and accounting records and/or errors within the billing
• Providing items to be reviewed and addressed during the billing review and approval process, including follow-up actions necessary to resolve the issues identified
• Providing a recommendation for approval and payment of the revised billings based on the resolution of the identified issues

Construction Cost Analysis (Contract Cost Audit)

We evaluate project records such as billings, detailed job cost reports, invoices, and other accounting data to determine the financial position and compliance with contracts for design and construction of capital projects, for both direct and indirect project costs. Services can be performed at one or more interim periods, such as:

• At the onset of construction, after the issuance of the first few billings, to ensure the billings have been set up in accordance with the specific terms and conditions of the applicable contract
• At the midpoint of construction to ensure billings and compliance with the applicable contract are on track
• At substantial completion of a construction project to ensure overall billings are trued-up and billed in accordance with the applicable contract as well as ensure that specific close-out items are completed

Claims Avoidance

We work with our clients to identify and minimize financial risks associated with the design and construction of capital projects through cost-effective solutions. We evaluate construction project accounting, controls, and financial management policies and procedures, and provide consulting advice associated with financial elements, including requests for additional compensation due to:

• Acceleration
• Change orders and directives
• Cost overruns
• Cumulative impacts
• Delay and disruption
• Escalation
• Field and home-office overhead
• Lost productivity
• Scope changes
• Wrongful termination
• Other events having a negative effect on profitability

Dispute Resolution Services

We provide expert witness services, including preparation of expert reports and rebuttal reports summarizing our findings and opinions of damages related to various elements of the design and construction of capital projects. Our experience includes analysis of cost allocations and accumulation methodologies associated with claim quantification and rebuttal calculations.

Representative Industry Experience

Our experience spans many different-sized matters in the U.S. and abroad, representing and opposing owners, architects, general contractors, subcontractors, joint ventures, and all other parties involved through the entire life cycle of construction. Select examples include:

• Airports, convention centers, and stadiums projects
• Commercial buildings projects
• Educational and civic structures and facilities projects
• Highways, bridges, and tunnels projects
• Hospitals and healthcare facilities projects
• Mass transit projects
• Multi-family and residential housing projects
• Refineries and offshore production and storage facilities projects
• Utilities generation and transmission structures and facilities projects

Cost Segregation Studies

Our cost segregation studies represent the analysis and allocation, or reallocation, of construction or acquisition costs amongst various building systems and components. Most commonly, our cost segregation studies are performed to identify and quantify building and site components eligible for accelerated depreciation methods for federal income tax purposes.

Cost segregation studies:

• Are applicable to both constructed and acquired real estate
• Can encompass a single or multiple location(s) and placed-in-service years
• Involve identifying building and site components that have a shorter tax depreciation recovery period than real property (per the U.S. Internal Revenue Code)
• Require tax knowledge to identify qualifying assets, and construction industry expertise to quantify related costs