Terminology - C

C.I.F.

Carriage, insurance and freight between home port and overseas destination. (A.C.E.)

C.P.A.

An abbreviation for CRITICAL PATH ANALYSIS (A.CE.)

C.P.A. Formula

Contract Price Adjustment Formula agreed between a purchaser and a supplier for the purpose of calculating price adjustment due to variance in material and labour rates during the contract period. normally calculating by;

C.P.A. formula = xpW + ypM
x = Portion of Contract Price which is Labour.
p = Fraction of contract period affected.
w = National Wage Award per cent.
y = Portion of Contract Price which is material.
M = Rise in cost of materials per cent. All values relative to date of tender. (A.C.E.)

Calendar

A listing of the work day numbers and associated dates which is arranged in a matrix to convert dates to day numbers and vice versa. In simulation
1. A facsimile of the civil calendar created by algorithm. usually a computer program.
2. A time-ordered list of events that have occurred in the past, are now occurring, or will occur in the future within a simulation run. (FLUOR)

Calendar Ratio

The relationship between the number of working days in a period and the number of working days in the relative budget period. (ICWA.)

Calendar Variance

The portion of the overhead difference which is due to the variation between the number of working days in the budget period and the number of working days in the period to which the budget is applied. (ICWA)

Cancellation Charges

Charges submitted by vendor or contractor in respect of purchase order or contract cancellation or termination by customer or client. (A.C.E.)

Cancellations Costs

Costs arising on a project due to the cancellation or termination of an issued purchase order or contract. (A.C.E.)

Capacity

The estimated maximum production on a sustained basis preferably for a continuous process. (A.C.E.)
OR
The estimated maximum level of production on a sustained basis, preferably expressed with the corresponding estimate of TIME EFFICIENCY (q.v.). (FLUOR)

Capacity Estimate

Prepared early in the project and is based on a comparative analysis of final cost on similar units. (ROMP). (FLUOR)

Capacity Factor

Term used in Estimating in respect of the capacity' ratio between two similar plants. (A.C.E.)

Capacity Factored Estimate

An estimate based on historical data factored to the required capacity (throughout, feed or product). Offsites, if included, may be individually factored or factored as a total from comparable installation. The capacity' estimate is one of the first estimates to be made on a project. (FLUOR)

Capacity of Existing Plant


Capacity' Usage Ratio

The relationship between the budgeted number of working hours and the maximum possible number of working hours in a budget period. (A.C.E.)

Capital

Money invested or available for investment against which earnings and dividends are measured. (A.C.E)
or
The sum invested or available for investment in any particular business against which earnings and dividends are measured. (A.A.C.E.)

Capital Budgeting


Defined allocation of capital resources for approved future investment. (A.CE.)
or
A systematic procedure for classifying, evaluating, and ranking proposed expenditures for the purpose of comparison and selection, combined with the analysis of the financing requirements. (A.A.C.E)
or
The combination of procedures required to foresee, evaluate, justify, finance, approve, and control major expenditure. Usually implies that a forecast of all foreseen expenditures for a given future period is made at one time. (ACE)
or
A systematic procedure for classifying, evaluating, and ranking proposed capital expenditures for the purpose of comparison and selection, combined with the analysis of the financing requirements. (FLUOR)

Capital Charges

Expenses which cannot be allocated to direct labour, materials, or production overheads. (ACE.)

Capital Cost Estimate

Any cost estimate for a future fixed asset, including design, supply and installation costs, but excluding any finance charges or operating expense. (ACE)
or
A forecast which is prepared to calculate the profitability of a project. (ACE)

Capital Employed

This normally represents the summation of the liabilities of a trading organisation, comprising :
1. Subscribed Shares
2. Loans
3. Reserves
4. Overdrafts on Banks
5. Unpaid Accounts (ACE.)

Capital Expenditure

Expenditure attributable to the creation of a permanent or fixed asset. (ACE.)
or
Costs in relation to the creation of a permanent or fixed asset. (ACE)

Capital Ratio

The relationship between shares which have a fixed earning capacity and those which have not. (ACE)

Capital Recovery

Recovery of capital invested in a project over the life of that project, including allowed depreciation. (ACE)
or
The process by which original investment in a project is recovered over its life. Depreciation allowance provides for investment recovery, excluding inflation. (ACE)

Capital, Cost Of

The weighted evidence of:
1. the after-tax cost of long term debt,
2. the yield on any outstanding preferred stock, and
3. the cost of common equity capital. (FLUOR)

Capital, Fixed

The total onginal value of physical facilities which are not carried as a current expense on the books of account and for which depreciation is allowed by the Federal Government. It includes plant equipment, building, furniture and fixtures, transportation equipment used directly in the production of a product or service. It includes all costs incident to getting the property in place and in operating condition, including legal costs, purchased patents, and paid up licenses. Land, which is not depreciable, is often included. Characteristically, it cannot be converted readily into cash. (FLUOR)

Capital, Sustaining

The fixed capital requirements to:
1. Maintain the competitive position of a project throughout its commercial life by improving product quality, related services, safety or economy, or
2. Required to replace facilities which wear out before the end of the project life. (FLUOR)

Capital, Working

The funds in addition to fixed capital and land investment which a company must contribute to the project (excluding start-up expense) to get the project started and meet subsequent obligations as they come due. Consists of the difference between current assets (cash, receivable, and inventories) and current liabilities (accounts, notes, and taxes payable). Characteristically, these funds can be converted readily into cash. Working capital is normally assumed recovered at the end of the project without loss. (FLUOR)

Capitalised Cost

1. The sum of money which, at a given interest rate, will will provide an infinite series of payments without diminishing the original sum, or the system for replacement analysis employing that sum. Also, the depreciable portion of a fixed investment.
2. The present worth of the investment for purchasing and operating a facility perpetually. As a system for comparing proposed investments, it requires assumption of a specific minimum acceptable interest rate. (A.A.C.E)
or
The present worth of the cost of renewing and operating a facility perpetually. As a system for comparing proposed investments, it requires assumption of a specific minimum acceptable interest rate. (FLUOR)

Carriage Paid

The term applied when the price is declared to include for carriage of the goods to purchaser. (ACE)

Cascaded Reports

This term refers to milestone reporting (see MILESTONE and MILESTONE REPORT). (FLUOR)

Cash

Moneys in hand or available for immediate use. (ACE)
or
The element of working capital, which includes moneys, cheques, receivable bills of exchange, bank deposits, available for current use. (ACE)

Cash Basis

Method of recording cost and income data based on actual cash payments and receipts. (ACE)
or
The accounting procedure whereby revenues and expense ate recorded when payment is received and made: distinguished from ACCRUAL BASIS. (ACE)

Cash Call

Projection of future cash requirements at specific points in time. (ACE)

Cash Cost

An alternative expression meaning MARGINAL COST. (ACE.)

Cash Flow

Projected cash balance over a stated time period based on the NET flow of actual or anticipated cash payments and receipts. (ACE.)
or
The algebraic sum. in any time period, of all income, expenses, and investments. Also called CASH PROCEEDS or CASH GENERATED. (A.A.CE.)
or
The passage of money into or out of the enterprises. For investment evaluation, investments are usually considered as negative cash flows,' after-tax profits. (FLUOR)

Cash Flow Curve

Cash Flow Curve is defined as a graphical depiction of the estimated manner in which expenditure will take place on the project. This is also known as an EXPENDITURE CURVE. (E.M.S.)

Cash Forecasts

see CASH CALL. (A.C.E.)
or
Estimates of NET current assets on hand which are used to determine the liquidity of the business enterprise. (ACE)

Cash Generation

NET increase in cash flow from an investment. (ACE)
or
A NET profit flow from an investment to the business enterprise. (ACE)

Cash Return

The difference, in any time period, between revenues and all expenses, including taxes. The sum of NET profit, after tax and the depreciation deduction used in calculating NET profit. (A.A.C.E)

Cash Return, Per Cent of Total Capital

Ratio of average depreciation plus average profit, to fixed and working assets, for a year, of capacity sales. Under certain limited conditions, this figure closely approximates that calculated by profitability index techniques. (AACE)
or
Ratio of average depreciation plus average profit, to total fixed and working capital, for a year of capacity sales. Under certain limited condition, this figure closely approximates that calculated by profitability index techniques where it is defined as the difference, in any time period, between revenues and all cash expenses, including taxes. The sum of NET profit after tax and the depreciation used in calculating NET profit. (FLUOR)

Category

A natural, logical grouping of associated data. (FLUOR)

Central Processing Unit

The hardware of a computer system that performs the arithmetic and logic operations and directs the other units of the system. (FLUOR)

Change

Any perceived deviation from a previously established base or basis. (ACE)

Change Alert

Advisory document for notification of perceived change. (ACE)

Change Control

Project control activity demanding early detection, evaluation and approval of project changes. (ACE.)

Change Estimate

Estimate prepared for evaluation of a perceived project change. (ACE.)

Change Impact

Effect of change on project cost and schedule. (ACE.)

Change of Scope

Any deviation from a previously established scope of supply or scope of work. (ACE)

Change Order

Document authorising execution of a defined project change. (ACE)
or
Is defined as any instruction to make a change, or changes, from the originally defined scope of the project, or any alterations to an agreed procedure, method of executing the work or any work already started or completed, which will lead to additional equipment baring to be provided or additional work having to be done which was not allowed for in the original contract. The cost of this additional work will be valued by the salaries and reimbursable of the personnel involved. This is also known as a VARIATION ORDER. (E.M.S)

Change Order Request

Document requesting authorised approval to execute a perceived project change. (ACE.)

Check Estimate

After detailed design is completed and the requirements for each commodity' material finalised, purchase orders and actual costs are used in the preparation of a check estimate. (FLUOR)

Check List

A glossary prepared for use with the analysis of capital cost estimates for complete plant facilities for any project, process or manufacturing industry. or sections thereof, to provide a means of ensuring that all items have been taken into account. (ACE.)

CIF

Carriage, Insurance and Freight. (ACE.)

Civil Engineering

The assessment, site development and construction of permanent foundations, concrete, masonry, brickswork, connected with any form of roadway, waterway, bridge, tunnel or industrial plant. (ACE)

Civil Work

Is defined as the costs incurred on a project to perform all earthworks, concrete work and building work, which are normally understood to be executed by a civil subcontractor. (EMS.)

Claim

Demand made for compensation or additional remuneration over and above existing contractual reimbursement. (ACE.)

Class I Estimate

Detailed estimate prepared for control purposes from well defined design data to an accuracy of+ 5%. (also known as DEFINITIVE ESTIMATE, DETAILED ESTIMATE or FINAL ESTIMATE). (ACE.)

Class II Estimate

Semi-detailed estimate prepared for initial budget purposes from preliminary but largely fixed design data to an accuracy of 10%. (also known as BUDGET ESTIMATE, SANCTION ESTIMATE, SCOPE ESTIMATE or SEMI-DETAILED ESTIMATE). (ACE.)

Class III Estimate

Pre-budget estimate prepared from very preliminary design data to an accuracy of plusminus 20%. (also known as EVALUATION ESTIMATE, PRE-DESIGN ESTIMATE, PRELIMINARY ESTIMATE). (ACE.)

Clock Units

The elemental, basic unit of time in a simulation, e.g., seconds, days, weeks. (FLUOR)

Clocked Time

Worked time as clocked. (ACE.)

Clocking Alley

Site housing for time clocks. (A.CE.)

Close-out Report

Final end-of-project or end of-assignment report. (ACE.)

Code of Accounts

Complete set of ACCOUNT CODES developed for the purpose of cost identification, cost collection and cost reporting, as necessary to cost control activity, (ACE.)

Commissioning

The starting up of a process or plant after completion of erection by the contractor. Responsibility for operation usually passes from the supplier to the purchaser during this point. (ACE.)

Commitment

Outstanding commercial liability in respect of orders placed. (ACE.)
or
An administrative reservation of funds based upon firm procurement directives, order, requisitions, or requests that authorise the recipient to create obligations. (FLUOR)

Committed Cost

Total value of all orders placed to date, including letters and telexes of intent, and including allowances for all additional costs anticipated in respect of such orders.
(ACE.)
or Is defined as the amount of money which Engineering Management Services, Ltd., agrees to pay for the supply of materials or for the performance of services. This amount of money has to be appropriated by the client to enable payment to be made, and will fall into the following categories
1. Procured items (e.g. EQUIPMENT or SERVICES)- the cost of the items listed on the procurement order, at the time of initiating the order, for which the client is committed to pay the supplier on delivery of the items or performance of the service.
2. Contracts (e.g. CIVIL or ERECTION CONTRACTS or SPECIALIST FEES) - when quantities and unit rates are given, the value of the extended schedule of rates at the date of awarding the contract, i.e. the Contract Price, updated progressively as new budgets of quantities and unit rates are produced.
3. Unit rate contracts (e.g. dayworks or plant hire) the actual value of work done to date, as measured and invoiced from time to time, whether the invoice has been paid or not.
4. Management contract - the actual invoiced value of work done from time to time whether the invoice has been paid or not. Note:
a) As materials are delivered and services are rendered, commitments are converted to costs.
b) As payments for materials or services are made, COMMITMENTS and COSTS are converted to expenditures. (EMS)

Committed Date
.

Commodity Account

Direct Field Prime Accounts (q.v.) for which the material portion is not easily identifiable or the items are so small and numerous that they are grouped and identified by units of measure (e.g., tons, SF, gal., cy, etc.). Includes all Direct Field Prime Accounts except the machine and equipment (400) account. (FLUOR)

Commodity Materials

(Distribution Materials) are the interconnecting, supporting and service items, i.e., piping, electrical, instrumentation, insulating, painting, etc. (FLUOR)

Comparative Estimate

See FEASIBILITY STUDY

Composite Rate of Depreciation

A reduction of value rate which is calculated by dividing the aggregate of the individual reduction charges (however calculated) in any one period of all the assets concerned, by the aggregate of the costs of those assets. (ICWA)

Compound Interest

The rate earned by money expressed as a constant percentage of the unpaid balance at the end of the previous accounting period. Typical time periods are yearly, semiannually, monthly and instantaneous. (AACE.)

Compound Interest Formula

The mathematical expression of the assumption that money can be used to earn more money and therefore that values be assumed to grow at a constant percentage.

n
P = Po (1 + R)
100
Where P = Final Principal Sum
Po = Initial Principal Sum
R = Rate of Interest %
n = Years. (ACE.)

Compounding

Use of compound interest to determine sums later in time which are equivalent to an earlier, smaller sum. (ACE.)

Computer Simulation

A logical-mathematical representation of a simulation concept, system, or operation programmed for solution on an analogue or digital computer. (FLUOR)

Conceptual Estimate

See ORDER OF MAGNITUDE

Condition Codes

Whenever a procedure finishes it sets a number inside the computer memory. This number is called a condition code and its value depends upon the errors (if any) that have occurred in the procedure. When subsequent procedures begin, the first thing they can do is test the condition codes set by previous procedures and, on the basis of these values, decide whether to continue. (FLUOR)

Condition Money

See DIRT MONEY. (ACE.)

Conditions of Contract

Terms agreed between the parties for the execution of a contract. (ACE.)

Confidence Interval

A statistical term denoting a range which is expected to bound a true value at a given percent of the time with a specified probability. (ACE.)

Confidence Level

A statistical term denoting a range which is expected to include a true value with a specified probability. (FLUOR)

Confidence Limit

Expressed percentage of the total probability of cost or schedule achievement within defined limits. (ACE.)

Confirmation of Verbal Instruction

Is defined as a written document issued to confirm an instruction given previously. This document does not have any monitory or cost value, but may lead to a CHANGE ORDER. (EMS)

Consistent Network

Any network containing only consistent paths; that is, paths which do not contain more than one occurrence of any individual event. Contrast with INCONSISTENT NETWORK. (FLUOR)

Constraint

See DEPENDENCY. (FLUOR)

Construction

The building and installation of capital plant. (ACE)

Construction Area

Geographical division within a project construction site specifically defined for construction purposes. (ACE.)

Construction Cost

The sum of all costs, direct or indirect inherent in converting a design plan for material and equipment into a project ready for operation, i.e., sum of field labour, supervision, administration, tools, field office expense and field purchased material costs. (FLUOR)

Construction Establishment

See SITE ESTABLISHMENT. (ACE)

Construction Facilities

See SITE ESTABLISHMENT. (ACE)

Construction Force

Direct site labour force, including trade foremen but excluding supervisors and field staff. (ACE)

Construction Indirect

Term commonly used to describe all indirect field expenses, such as non-productive labour, field staff. field office costs, construction tools, etc. (ACE)

Construction Management Costs

Are defined as the salaries and reimbursable of the personnel directly involved in the supervision and control of the erection of the project. This is also known as the FIELD OFFICE COSTS. (EMS)

Construction Phase

Period within the life of a project covering site construction activity. (ACE)

Construction Philosophy

Overall plan of construction work, stating intended methods of execution, sequence and timings of key activities, utilisation of direct or sub-contract labour resources, etc. (ACE.)

Construction Progress

Construction progress is monitored and reported as percent complete. Actual work units completed for each prime account are, measured against the estimated man-hours as developed from the drawing take-off of materials. (FLUOR)

Construction Progress Report

A measure of field construction progress (percent complete). Accounts such as concrete, piping, electrical, instrumentation, etc., may be reported individually and/or all in summary for a physical percent completion on the total project. Reports may be in tabulated or graphic form. Actual percent completion is not be confused with the ratio of man-hours worked to total budgeted man-hours. (FLUOR)

Construction Quantities

Measured and quantified construction work. (A CE)

Construction Schedule

A construction plan set to a time calendar usually consists of three levels of detail management level, project level, control level. (FLUOR)

Construction Supplies

General term covering consumable, fuels, protective clothing and other miscellaneous items necessary to construction work. (ACE)

Construction Tools

Plant, machinery, equipment and small tools as required for field construction purposes. (ACE)

Construction Tools and Supervision

Consumable stores, such as oxygen, gases, fuel oils, lubricants, hand tools and the salaries of staff supervising construction work. (ACE)

Consumable

Indirect material consumed or permanently incorporated into a construction project, including non-recoverable form work, shims and packing, welding electrodes, industrial gases, fuel, etc. (ACE)

Contingencies

An allowance for unforeseenable elements of cost, particularly in fixed investment estimates, which previous experience has shown to be statistically likely to occur. May include allowance for escalation. (FLUOR)

Contingency

Budgetary provision for unforeseen occurrences within a defined project scope, commonly released or reduced by formula. (ACE)
or
An allowance for unforeseeable elements of cost. particularly in fixed investment estimates, which previous estimates have shown to be likely to occur. May or may not include allowance for escalation. (ACE)
or
Budgetary provision for unforeseen costs in a defined project. (ACE)
or
Is defined as an amount of money allowed in the estimate for uncertainties and unknown items or conditions. Contingency is divided into two categories;
1. Uncertainties and errors in estimating - an amount of money allowed by Engineering Management Services, Ltd., to cope with the inaccuracies of estimating. This amount will decrease as the accuracy of the estimate improves.
2. Scope changes - an amount of money allowed by the client for alterations to the scope of the project during the design or construction stages. (EMS)

Contingency Drawdown

Reduction of contingency against a pre-determined plan throughout project execution. (ACE.)

Contingency Management

Term given specifically to the monitoring and manipulation of contingency in respect of progress achieved and risk remaining. (ACE)

Contingent Reserve

Current value of contingency held or remaining. (ACE)

Continuous Interest

The use of investment earning factors assuming an instantaneous base period for compounding, rather than quarterly, annually, etc. Rate of return is usually calculated by this technique. Note that nominal continuous interest of 20% results in an effective annual rate of 22% per year, etc. (ACE)

Contract

Legal and binding agreement in writing between two or more parties, defining scope of work or services to be provided, and terms and conditions of financial settlement. (ACE)
or
1. A written document, enforceable by law containing the terms and conditions of an agreement between two or more individuals or firms.
2. The entire body of scheduling data for a project.
3. A project. (FLUOR)

Contract Area

Any natural logical grouping of interrelated activities within a contract that can be created as a single entity. (FLUOR)

Contract Award

Usually pertains to a specific date when formal notification is given by an owner authorising the Contractor to perform a function in accordance with conditions specified. (FLUOR)

Contract Estimate

Any estimate relating to a defined contract. (ACE)
or
A forecast prepared for a project based on final design. (ACE)

Contract Master Schedule

The MANAGEMENT LEVEL SCHEDULE that shows the overall plan for the total contract. (FLUOR)

Contract Period

Time stated in contract documents lot the execution of the works. (ACE)
or
Commences from the date of contract document and terminates on the date when the plant is taken over, commissioned or ready for commercial use, whichever is the earlier. (ACE)

Contract Price Adjustment (CPA)

Alteration to a firm price allowable under contract, usually in respect of escalation and evaluated by formula. (ACE)

Contractor

A person or group of persons, employed by a purchaser to supply materials, labour or services in accordance with a prepared agreement. (ACE)

Contractor's Estimate

Submitted by a supplier to a purchaser quoting rates and terms and conditions under which the supplier is prepared to execute or negotiate a formal contract. (ACE)

Contractor's Fee

The financial reward to a contractor for executing work, as a third party. Normally it is a percentage of a contract price (or fixed sum) agreed between a purchaser and a supplier. (ACE)

Contractor's Fees

In a cost-plus contract, the fee for services of the contractor on installation or fixed capital facilities; usually included in the fixed investment appearing on the final accounting books. Generally applies only to the profit portion of contractor's reimbursement. (FLUOR)

Contracts

Legal agreements between two or more parties, which may be of the type enumerated below:
1. In COST PLUS CONTRACTS, the Contractor agrees to furnish to the Client services and material at actual cost, plus an agreed-upon fee for his services. This type of contract is employed most often when the scope of services to be provided is not well defined.
a) Cost Plus percentage Burden* and Fee : The Client will pay all costs as defined in the terms of the contract, plus "burden and fee" at a specified percent of the labour costs which he is paying for directly. This type of contract generally is used for engineering services. *In contracts with some Governmental agencies these items are included indirect cost
b) Cost Plus Fixed Fee : The Client pays costs as defined in the contract document. Burden on Reimbursable Technical Labour Cost is considered in this case as part of the cost. In addition to the costs and burden, the Client also pays a fixed amount as the Contractor's "fee".
c) Cost Plus Fixed Sum : The Client will pay costs defined by contract plus a fixed sum which will cover "non-reimbursable" costs and provide for a fee. This type of contract is used in lieu of a Cost Plus Fixed Fee contract where the Client wishes to have the Contractor assume some of the risk for items which would be reimbursable under a Cost Plus Fixed Fee type of contract.
d) Cost Plus Percentage Fee : The Client pays all costs, plus a percentage for the use of the Contractor's organisation.
2. Fixed PRICE types of contract are ones wherein a Contractor agrees to furnish services and materials at a specified price, possibly with a mutually agreed upon escalation clause. This type of contract is most often employed when the scope of services robe provided is well defined.
a) Lump Sum : Contractor agrees to perform all services, as specified by the contract for a fixed amount. A variation of this type may include a Turn-Key arrangement where the contractor guarantees quality, quantity, and yield on a process plant or other installation.
b) Unit Price : Contractor will be paid at an agreed upon unit rate for services performed. For example, technical man-hours will be paid for at the unit price agreed upon. Often, field work is assigned to a Subcontractor by the Prime Contractor on a unit price basis.
c) Guaranteed-Maximum (Target Price) : A Contractor agrees to perform all services as defined in the contract document guaranteeing that the total cost to the Client will not exceed a stipulated maximum figure. Quite often, these types of contracts will contain special share-of-the saving arrangements to provide incentive to the contractor to minimise costs below the stipulated maximum.
d) Bonus Penaltv : A special contractual arrangement usually between a Client and a Contractor where-in the Contractor is guaranteed a bonus, usually a fixed sum of money, for each day the project is completed ahead of a specified schedule and/or below a specified cost, and agrees pay a similar penalty for each day of completion after the schedule date or over a specified cost up to a specified maximum either way. The penalty situation is sometimes referred to as liquidated damages. (FLUOR)

Contribution

The difference between sales and the marginal cost of sales. (ICWA)

Control Budget

Any budget used for control purposes, against which actual performance is measured. (A CE)

Control Code

See COST CODE. (ACE)

Control Estimate

Any estimate used as a basis or yardstick for cost control purposes. (ACE)
or
A forecast of capital cost prepared and used during the course of a project to indicate and check the probable total of final expenditure. (ACE)
or
The capacity-factored or equipment-factored estimates may serve as the control estimate. (FLUOR)


Control of Change

See CHANGE CONTROL. (ACE)

Control Schedule

A current schedule that accurately depicts the required milestones and serves as a monitoring tool over actual progress. On a developing project the controlling schedule may progress sequentially from the proposal or master schedule through the subsequent initial engineering schedule, detailed engineering schedule, and CPM construction schedules. (FLUOR)

Control Team

A team of specialists in cost and scheduling engineering assigned to the task force to relate time and money impact to schedule and budget. (FLUOR)

Control Tool

Term given to any cost control aid such as an estimate, budget, cost code, computer system, control procedure, cost report, etc. (ACE)

Controllable Cost

An expense which can be influenced by the action of a given member of undertaking. (ACE)

Conversion Cost

The production expense (excluding the expense of direct material but including the expense resulting from variations in direct material weight or volume), of producing partly - or fully - finished products. (ACE)

Corrective Action

Remedial management activity taken to eliminate or minimise identified potential cost or schedule over-run. (ACE)

Cost

Expense, estimated or actual. (ACE)
or
1. The amount of expenditure incurred on a given thing.
2. To ascertain the expense of a given thing. (ICWA)
or
Is defined as the value of work done, money has been expended, but for which no money has been expended. (EMS)

Cost Account

See ACCOUNT. (ACE)

Cost Accountancy

The science, art and practice of a cost accountant. (ICWA)
or
The process of recording expenditure and income or the basis upon which they are calculated so that the records can be used in the preparation of statistical data.(ACE)

Cost Activity

An activity constructed specifically for accounting costs that are a charge to the project. It does not directly affect the network calculations. (FLUOR)

Cost Allocation

The allotment of items of expense to cost centres or units. (ICWA.)

Cost Analysis

Systematic breakdown of cost data into pre-defined elements or categories for detailed examination. (ACE)
or
A systematic breakdown of expense data into classified ELEMENTS to facilitate examination. (ACE)

Cost and Price

The former term is the amount paid by a purchaser and the latter is that received by the vendor. Consequently, a tender is at one and the same time both the anticipated expense and the contract value offered by the supplier. Since the professions are acting for the client they are concerned with his COSTS. (ACE)

Cost Apportionment

The allotment of proportions of items of expense to cost centres or cost units. (ICWA.)

Cost Audit

The verification of the correctness of expense accounts and of the adherence to the cost accounting plan. (ICWA)

Cost Blackout

Prolonged absence of verified forecast cost status, often occurring as a result of failure to monitor the impact of front-end design development on final project cost.(ACE)

Cost Breakdown

Systematic breakdown of costs. into pre-defined elements. (A. CE)

Cost Budget

Cost target for completion. (ACE)

Cost Centre

Principal cost collection facility with defined responsibility for budgetary control. (ACE)
or
1. A location, person or item of equipment (or group of these) in or connected with an trader taking, in relation to which expenses may be ascertained and used for the purpose of expenditure control. (ICWA)
2. An accounting group consisting of installed items of equipment, a facility or a product manufacturing system or sub-system. (ACE)

Cost Checking

The process of examining the actual expenditure of each ELEMENT against the target set for it in the cost plan. (ACE)

Cost Classification

Arrangement of different types of costs into defined groups and sub-groups. (ACE)
or
The process of grouping expenditure according to its common characteristics. (2) a series of specified groups according to which expenses are classified. (ICWA)

Cost Code

Identifying code assigned to specific cost items in accordance with a defined, methodical and usually hierarchical classification system. (ACE)
or
A series of alphabetical and/or numerical symbols, each of which represents a descriptive title in expenditure classification. (ACE)
or
A standard accounting working system in which items of expense or fixed capital such as equipment and material are identified with a numerical figure to facilitate account keeping and cost control of a project. (ICWA)
or
Is defined as the series of alpha or numeric characters which is allocated to a particular item to identify that item within the cost engineering systems, and to enable money or costs to be allocated to the item. (EMS)
or
A system in which items of expense of fixed capital such as material, labour and subcontracts are identified with numerical figures to facilitate account keeping and cost control. (FLUOR)
or
Systematic restraint on expenditure in order to secure completion within pre-determined budgets or targets. (ACE)

Cost Control

The process of regulating all factors of expenditure connected with fixed investment during installation and/or production. to ensure that expenditure is within the amount appropriated. (ICWA.)
or
Is the application of procedures to follow the progress of design and construction projects as well as manufacturing operations in order to minimise cost with the objective of increasing profitability and assuring efficient operations. There are three essential elements of control. The first is to establish the optimum condition. the second is the measure variation from the optimum and the third is to take corrective action in order to minimise this variation. The application of these procedures attempt to limit costs to those authorised per capital projects or cost standards, focuses control efforts where they will be most effective, and achieves maximum control at minimum operation costs. (FLUOR)

Cost Control Account

1. A statement of expenditure which is maintained in the principal ledger (and sometimes in the cost ledger) recording the totals of the transactions entered in detail in the cost ledger.
2. A statement of recorded expenditure showing the current state of work-in-progress and stock when physical count is impracticable and also to provide a check against physical inspection as and when this takes place.(ACE)

Cost Control Estimate

See CONTROL ESTIMATE. (ACE)

Cost Control Report

See COST REPORT. (ACE)

Cost Control Team

A team of cost and scheduling specialists assigned to a task force project in order to effectively execute cost control. (FLUOR)

Cost Curve

Is defined as a graphical depiction of the estimated manner in which costs are anticipated to occur during the life time of the project. (EMS)

Cost Deviation

Any variance or departure from a previously defined base or basis. (ACE)
or
A variation from estimated expenditure. (ACE)

Cost Efficiency (CE)

A percent value that reflects a comparison of the VALUE OF WORK PERFORMED as of a particular date and the ACTUAL COST as of that particular date. It is computed by the formula
CE = (V) (100%)
A
Where (A) is the ACTUAL COST and (V) is the VALUE OF WORK PERFORMED. (FLUOR)

Cost Element

Classified component of larger cost item. (ACE)
or
Any portion of an expenditure which can be separately classified. (ACE)

Cost Engineer

An engineer who by virtue of his training and experience is competent to develop and make practical use of the principles of engineering cost management. (ACE)
or
A person with skill in any branch of the engineering industry, who is competent by reason of education, training and experience in engineering and project evaluation to :
1. Determine, in the design and planning stage, the economic and cost factors in the construction, tendering, starting or operating of industrial plants, equipment or distribution and transportation projects.
2. Advise on design and planning to achieve a sound balance between capital and operating expenditure in relation to planned performance.
3. Apply scientific and economic principles and techniques to problems of capital expenditure estimation, cost control and profitability. (ACE)
or
Any engineer employing his technical skills in the practice of cost estimation, cost control, profitability, or general engineering economics. (FLUOR)

Cost Engineering

That area of engineering practise devoted to the problems of project cost management, involving such activities as estimating, cost control, investment appraisal and risk analysis. (ACE.)
or
The application of scientific principles and techniques to problems of expenditure estimation. cost control and profitability. (AACE.) USA.

Cost Estimate

Any considered prediction of future or final project costs. (ACE)

Cost Forecast

Estimate or prediction of future or final expenditure. (ACE)

Cost History

Record of previously incurred costs or cost movements in respect of defined items or areas of expenditure. (ACE.)

Cost Impact

Effect or influence of some occurrence, commonly a change, on an existing cost budget or forecast. (ACE)

Cost Increment

Expense due to change of method or rate. (A.CE.)

Cost Index

Factored tabulation of recorded cost movements for a particular item over a specified period of time as measured from a defined base date. (ACE)
or
A number which relates the cost of an item at a specific time, to the corresponding cost at some arbitrarily specified time in the past. (AA.CE)

Cost Index (Price Index)

A number which relates the cost of an item at a specific time to the corresponding cost at some arbitrarily specified time in the past. (FLUOR)

Cost Indices

Series of factored tabulations as defined above for COST INDEX. (A CE)
or
A series of numbers recording changes in values since some predetermined date, when the basic value was equal to 100. (ACE)

Cost Journal

Accounting book recording daily transactions in respect of the COST LEDGER. (ACE)
or
An accounting book which records daily, those transactions which affect solely the cost ledger. (ACE)

Cost Ledger

Accounting book for recording both cost and revenue. (ACE)
or
An accounting book recording income and expenditure for the purpose of expenditure determination. (ACE)

Cost Manual

A document defining the terms and definitions of elements of expenditure, with instructive explanations. (ACE)

Cost Model

Plan of proposed or anticipated expenditure phased over scheduled time periods. (ACE)

Cost Monitoring

Close observation of the costs of work in progress with reference to established cost targets. (ACE)
or
Action taken to obtain continuously a realistic assessment of the ultimate expense of a project to obtain the earliest possible warning of a probable deviation from the amount sanctioned. (ICI)

Cost Movement

Any change or fluctuation in a previously stated or recorded cost. (ACE)

Cost Norm

Established average or expected cost of defined item or unit of work. (ACE)

Cost or Capital

The expense of obtaining the total capital employed by a firm, expressed as an interest rate. The total or combined cost of capital must consider both the value of equity capital and the expense of borrowed funds.
1. The weighted average of:
i) The after-tax expense of a long-term debt,
ii) The yield on any outstanding stock, and
iii) The value of common equity capital (AA CE) USA.
3. The expenses incurred in providing dividends on stockholders' shares or bank loans (ACE)

Cost of Defectives

The expense recorded in producing goods which are below standard quality. (ACE)

Cost of Living Index

A series of numbers, prepared by the Ministry of Labour, and based on retail prices which measures the change from month to month in the average level of prices of the commodities and services purchased by the majority of householders in the United Kingdom. The official title is INDEX OF RETAIL PRICES. (ACE)

Cost of Old Plant

.

Cost of Sales
The total expenditure on materials, labour, factory, overheads, administration, distribution of a product and any other marketing expenses. Profits not included. (ACE)

Cost of Work Performed

See ACTUAL COST OF WORK PERFORMED or BUDGET COST OF WORK PERFORMED. (ACE)

Cost of Work Scheduled

See BUDGET COST OF WORK SCHEDULED. (ACE)

Cost Over-run

Any adverse cost variance. (ACE)

Cost Phasing

Term used to describe the distribution over time of planned or actual costs incurred. (ACE)

Cost Plan

See COST MODEL. (ACE)
or
A statement of intended expenditure on each ELEMENT of a project within a total sum and in relation to a defined standard of quality. The allowances set against each element are COST TARGETS. (ACE)

Cost Planning

A method of controlling the expenditure on a project, within determined limits, during the design process. It includes the preparation of the cost plan as well as the subsequent stages of COST CHECKING (ACE)
or
Encompasses all of Fluor's estimating, budgeting and reporting techniques used to develop cost monitoring and cost control on a project. (FLUOR)

Cost Plus Contract

General term describing form of contract where reimbursement is based on actual costs incurred plus some form of mark-up or fee to cover overhead and profit. (ACE)

Cost Plus Fee

Contract is defined as a contract where the total cost, including overheads, incurred by Engineering Management Services, Ltd., are reimbursable as defined by the contract, and in addition Engineering Management Services, Ltd., receives a fee. The fee may be a fixed fee or a percentage fee based upon the total costs. (EMS)

Cost Prediction

See COST FORECAST. (ACE)

Cost Provision

See PROVISION. (ACE)
or
A sum allowed in a forecast for an expected element of expense, which is not readily predictable. (ACE)

Cost Record

See COST HISTORY. (ACE)

Cost Recording

Process of setting down actual costs or cost movements as they occur or as they are perceived to occur. (ACE)

Cost Report

Formal record or register of current cost information prepared in an agreed manner for advisory, statistical or historical purposes. (ACE)

Cost Reporting

Process of preparing Cost Reports, usually on a regular time basis. (ACE)

Cost Slope

The rate of change in cost as reflected by changes in activity or project duration along a COST CURVE. (FLUOR)

Cost Statement

Any formal presentation of cost information. (ACE)
or
1. A document summarising the elements of a total cost for the purpose of cost control or audit.
2. A document which shows in summarised form the operating results of the whole or part of an undertaking and which may be interim, periodic or final. (ICWA)

Cost Status

Current cost situation expressed in respect of budgets, commitments, expenditures and forecasts. (ACE)

Cost Study

Any examination or analysis of a specific cost situation. (ACE)
or
The application of various methods of investigating project expenditure, including capital, maintenance and running expenses. COST RESEARCH is a synonymous term.(ACE)

Cost To Complete

See ESTIMATE TO COMPLETE. (AACE)

Cost To Date

Any costs variously committed, incurred, expended, accrued, etc., to a specifically defined current cut-off date. (ACE)

Cost To Go

See ESTIMATE TO COMPLETE. (ACE)

Cost Trend

Perceived sequence of either adverse or favourable cost variances. (ACE.)

Cost Under-run

Any favourable cost variance. (ACE.)

Cost Unit Rate

An actual or predetermined rate of expense apportioned or overhead absorption which is calculated by dividing the expense to be apportioned or absorbed by the number of units produced or expected to be produced. (ICWA)

Cost Variance

Confirmed or forecast deviation between actual or forecast cost and previously established budget or estimate. (ACE)
or
1. The difference between standard and actual expense.
2. The difference between budget cost and actual expense. (ACE)

Cost-Plus Contract

A type of contract under which a contractor furnishes all material, construction equipment, and labour at actual cost, plus an agreed upon fee for his services. (FLUOR)

Costing

The technique and process of ascertaining expenditure. (ACE)

CPA

Contract price adjustment (2) critical path analysis. (ACE)

Cr-1 Curve (Craft Requirement Curve)

Indicates the early and late manning requirements for the PROJECT PLAN. (FLUOR)

Craft

Any of a series of special arts, skills, or occupations. (2.) the numbers of an occupational trade. (FLUOR)

Crash Cost

The cost associated with the shortest possible duration (i.e., CRASH TIME of an activity or project). (FLUOR)

Crash Time

The shortest possible duration of an activity or project. (FLUOR)

Credit Terms

A method of payment where a supplier allows a purchaser to pay for goods supplied, over an agreed period. (ACE)

Crew

Is defined as number of men, consisting of artisans, semi-skilled labour and unskilled labour, required to perform a specified task. (EMS)

Critical Activities List

A listing of activities that have 10 days* or less of remaining total float. *Time is optional - 10 days is normal. (FLUOR)

Critical Activity

An activity whose duration cannot be increased without increasing the completion date of the overall project. (FLUOR)

Critical Event

An event of the Critical Path. (FLUOR)

Critical Path

The critical path is the longest path through the network - the shortest time in which the scheduled project can be completed. (FLUOR)

Critical Path Analysis (CPA)

The planning, organisation, direction and control of a project normally expressed on a chart to emphasise the important or critical factors and their bearing on efficient progress. (ACE)
or
The project network technique for determining minimum project duration and the several types of floats and slack. (FLUOR)

Critical Path Method

A scheduling technique which utilises an arrow diagram to depict the sequence and interrelationships of the various activities involved in a project. When time estimates are added, CPM allows for the calculation of the minimum expected completion time and the identification of the. critical (limited) and excess (float) resources area. (FLUOR)

Critical Predecessor

The event which immediately precedes the event under consideration on the most time consuming path leading to the event. (FLUOR)

Critical Successor

The event which immediately succeeds the event under consideration on the most time consuming path away from the event. (FLUOR)

CTR

Cost, Time and Resource - particular concept of project control based on assigning costs, duration and resources to individual network activities. (ACE)

Currency Differential

Cost variance due to currency exchange rate fluctuations. (ACE)

Current Average Method

Method of assigning inventory values to the quantities closed (or transferred) to the cost of sales account. The current average method is the average of the inventory on hand at the beginning of the month plus the current months production. (ACE)

Current Budget

Original budget plus all approved budget changes and transfers (ACE)
or
A financial and/or quantitative statement, which is established for use over a short period of time and is related to present conditions. (ACE)

Current Cost

Any cost based on present date conditions or determined from current data evaluation. (ACE)
or
A cost which is based on present date valuation. (ACE)
or
An expense calculated in relation to present-day conditions. (ACE)

Current Cost Variance

Current variance between ACTUAL COST OF WORK PERFORMED and BUDGET COST OF WORK PERFORMED. (ACE)

Current Standard

A cost unit rate which is in present use. (ACE.)
or
A standard established for use over a short period of time and which is related to present conditions. (ACE.)