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Knowing the project risk helps turner to find a formula for sharing
the savings
Contd..
Prediction at any point of time the total expected cost and earnings
contribution of a completed project
Q.3 Evaluate IOR systems and related report and meeting? Does the IOR
systems address contingencies identified in previous question?
If you were Gary Thompson, what would you say about the $500,000 contingency
Reported Earnings if further scope changes are allowed
Head
Cost
Microsoft Excel
97-2003 Worksheet
Comments
29,000,000.00
Construction Contingency
725,000.00
Contingency hold
328,000.00
Exposure hold
471,000.00
Already released
215,000.00
of Construction contingency
510,000.00
5,800,000.00
145,000.00
166,025.00
94,200.00
65,600.00
What we suggest
Retain double the estimated contingency hold because of strike and other risks
131,200.00
166,025.00
540,775.00
405,581.25
Our share
135,193.75
108,155.00
Cost
Comments
$
Microsoft Excel
29,000,000.00
97-2003 Worksheet
$
CC is usually 2.5% we are already
725,000.00
getting lesser
$
1.13% of total project cost
328,000.00
$
1.63% of total project cost
471,000.00
$
of Construction contingency
215,000.00
$
510,000.00
$
5,800,000.00
$
145,000.00
$
94,200.00
$
65,600.00
$
131,200.00
$
145,000.00
$
561,800.00
$
421,350.00
$
140,450.00
If you were Gary Thompson, what would you say about the $500,000 contingency