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    ABC DO - 197 - s2016

    Uploaded by

    Carol Santos
    The document provides revised guidelines for preparing the Approved Budget for the Contract (ABC) for public works projects in the Philippines. It outlines that the ABC should be based on approved design plans and specifications and include direct costs for materials, labor, equipment, and permits, as well as indirect costs for overhead, contingencies, profit margin, and VAT. It provides percentages to use for calculating indirect costs based on the estimated direct cost and establishes procedures for preparing, processing, and approving the ABC.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    ABC DO - 197 - s2016

    Uploaded by

    Carol Santos
    2K views5 pages
    The document provides revised guidelines for preparing the Approved Budget for the Contract (ABC) for public works projects in the Philippines. It outlines that the ABC should be based on approved design plans and specifications and include direct costs for materials, labor, equipment, and permits, as well as indirect costs for overhead, contingencies, profit margin, and VAT. It provides percentages to use for calculating indirect costs based on the estimated direct cost and establishes procedures for preparing, processing, and approving the ABC.

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    manual of standards for aerodomes-caap

    Original Title

    ABC DO_197_s2016

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    The document provides revised guidelines for preparing the Approved Budget for the Contract (ABC) for public works projects in the Philippines. It outlines that the ABC should be based on approved design plans and specifications and include direct costs for materials, labor, equipment, and permits, as well as indirect costs for overhead, contingencies, profit margin, and VAT. It provides percentages to use for calculating indirect costs based on the estimated direct cost and establishes procedures for preparing, processing, and approving the ABC.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    2K views5 pages

    ABC DO - 197 - s2016

    Uploaded by

    Carol Santos
    The document provides revised guidelines for preparing the Approved Budget for the Contract (ABC) for public works projects in the Philippines. It outlines that the ABC should be based on approved design plans and specifications and include direct costs for materials, labor, equipment, and permits, as well as indirect costs for overhead, contingencies, profit margin, and VAT. It provides percentages to use for calculating indirect costs based on the estimated direct cost and establishes procedures for preparing, processing, and approving the ABC.

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    © All Rights Reserved
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    .

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    '"

    o1

    DEPARTMENT

    in

    Republic of the Philippines


    OF PUBLIC WORKS AND HIGHWAYS

    OFFICE OF THE SECRETARY


    Manila

    OCT 2016

    DEPARTMENT ORDER

    197

    NO.
    _
    Series of 201~{ll..(Il.'~

    SUBJECT: Revised
    Guidelines
    in
    the
    Preparation of Approved Budget for
    the Contract (ABC)

    )
    )
    )
    )

    The following policies, rules and procedures relative to the preparation of the "Approved
    Budget for the Contract" (ABC) previously prescribed under Department Order No. 22,
    Series of 2015, are hereby revised/reiterated.
    The ABC shall be prepared on the basis of the design plans for the project which has been
    duly approved by authorized officials in accordance with existing regulations.
    All items of work to be used in preparing the ABC shall conform to the Standard
    Specifications for Highways, Bridges and Airports, revised 2013, Standard Specifications for
    Public Works Structures, 1995, and approved Special Specifications for the project.
    The ABC shall be composed of the Direct Cost and the Indirect Cost.
    A. The Direct Cost shall consist of the following:
    A.1 Cost of materials to be used in doing the work item called for, which shall include,
    inter alia, the following:
    A.1.1 Cost at source, including processing, crushing, stockpiling, loading, royalties,
    local taxes, construction and/or maintenance of haul roads, etc.
    A.1.2 Expenses for hauling to project site.
    A.1.3 Handling expenses.
    A.1.4 Storage expenses.
    A.1.5 Allowance for
    requirement.

    waste

    and/or

    losses,

    not

    to

    exceed

    5%

    of

    materials

    A.2 Cost of Labor:


    A.2.1 Salaries and wages,
    Employment.

    as authorized

    by the

    Department

    of

    Labor and

    A.2.2 Fringe benefits, such as vacation and sick leaves, benefits under the
    Workmen's Compensation Act, GSIS and/or SSS contributions, allowances,
    13th month pay, bonuses, etc.

    D.O. No. 197 Series of 2016


    Revised Guidelines in the Preparation of Approved Budget for the Contract (ABC)
    Page 2 of 4
    f

    A.3 Equipment Expenses:


    A.3.1 Rental rates of equipment shall be based on the prevailing "Association of
    Carriers and Equipment Lessors, (ACEL) Inc." approved for use by the DPWH
    (Presently it is the 2014 ACEL Rates). Rental rates of equipment not indicated
    in the ACEL booklet shall be taken from the rental rates prepared by the
    Bureau of Equipment. For simplicity in computation, the operated rental rates
    are preferred over the bq,re rental rates as the former includes operator's
    wages, fringe benefits, fuel, oil, lubricants and equipment maintenance. The
    make, model and capacity of the equipment should be indicated in the
    detailed unit cost analysis.
    A.3.2 Mobilization and demobilization shall be treated as a separate pay item. It
    shall be computed based on the equipment requirements of the project
    stipulated
    in the proposal and contract
    booklet.
    Mobilization and
    demobilization shall not exceed 1% of the Estimated Direct Cost (EDC) of the
    civil works items. However, in special cases wherein requirements for
    mobilization/demobilization
    exceed 1%, an approval to utilize the actual
    computed mobilization/demobilization
    cost shall be secured from the
    concerned Undersecretary for Operations.
    A.4 Cost for Permits, Clearances and other Government Taxes (i.e. MMDA Permit, LGU
    Permits, Bureau of Fire Protection Clearance, etc.) shall be included in the cost
    under Part B - Other General Requirements of the Program of Works (POW) and
    Estimate/ABC.
    B. The Indirect Cost shall consist of the following:
    B.1 Overhead
    following:

    Expenses -

    ranges from

    7 -

    11% of the EDC, which includes the

    B.1.1 Engineering and Administrative Supervision.


    B.1.2 Transportation

    allowances.

    B.1.3 Office Expenses, e.g., for office equipment and supplies, power and water
    consumption, communication and maintenance.
    B.1.4 Premium on Contractor's All Risk Insurance (CARl).
    B.1.5 Financing Cost.
    B.1.5.1 Premium on Bid Security
    B.1.5.2 Premium on Performance Security
    B.1.5.3 Premium on Surety for Advance Payment
    B.1.5.4 Premium on Warranty Bond (one year)
    B.2 Contingencies - ranges from 0.5 - 3% of the EDC. These include expenses for
    meetings, coordination with other stakeholders, billboards (excluding Project
    Billboard which is a pay item under the General Requirements), stages during
    ground breaking & inauguration ceremonies, and other unforeseen events.

    D.O. No. /'17, Series of 2016


    Revised Guidelines in the Preparation of Approved Budget for the Contract (ABC)
    Page 3 of 4
    B.3 Miscellaneous Expenses - ranges from 0.5 - 1% of the EDC. These include
    laboratory tests for quality control and plan preparation.
    BA Contractor's Profit Margin - shall be 8% of the EDC for projects above P5Million and
    10% for projects P5Million and below.
    B.5 VAT Component - shall be 5% of the sum of the EDC, OCM and Profit.
    ...

    B.6 The following items shall not be subjected to OCM and Profit mark-up:
    B.6.1 Mobilization and demobilization
    B.6.2 Provision of Service Vehicle
    B.6.3 Permits and Clearances
    B.7 The following non-civil works items shall not be subjected to OCM mark-up:
    B.7.1 Field/Laboratory Office & Living Quarters (Rental Basis)
    B.7.2 Furnishing of
    Consumables

    Furniture,

    Laboratory

    Equipment,

    Survey

    Equipment

    and

    B.7.3 Assistance to the Engineers


    B.7 A Photographs
    B.7.5 Health and Safety
    B.7.6 Traffic Management
    B.7.7 Environmental Compliance
    B.7.8 Communication Equipment, etc.
    NOTE:

    For the percentage to be used for Nos. 8.1, 8.2 and 8.3, see OCM (Overhead,
    Contingencies and Miscellaneous) column in the tabulation below.
    INDIRECT COST
    % FOR
    OCM AND PROFIT

    ESTIMATED
    DIRECT COST (EDC)

    TOTAL
    INDIRECT COST
    % FOR
    OCM AND PROFIT

    OCM
    (% OF EDC)

    PROFIT
    (% OF EDC)

    Up to P5Million

    15

    10

    25

    Above P5M up to P50M

    12

    20

    Above P50M up to P150M

    10

    18

    Above P150M

    16

    C. The prescribed format for the calculation of the ABC is shown in Attachment "A",
    C.l

    Instructions for filling-up the format:

    D.O. No. ~
    Series of 2016
    Revised Guidelines in the Preparation of Approved Budget for the Contract (ABC)
    Page 4 of 4
    C1.1

    Columns (1) to (4) are self-explanatory.

    C1.2

    Column (5) is th~e EDC of the work item as calculated and reflected in the
    cost analysis prepared by the Estimator.

    C1.3

    Columns (6) and (7) are the mark-ups in percent for OCM and profit.

    Cl,4

    Column (8) is the total mqrk-up, which is the sum of the percentages under
    columns (6) and (7).

    C1.5

    Column (9) is the Peso value of the total mark-up. It is determined by


    multiplying the total mark-up on percent in column (8) with the EDC (column

    5).
    C1.6

    Column (10) is the VAT component which is 5% of the sum of columns (5)
    and (9).

    C1.7

    Column (11) is the total estimated Indirect Cost which is the sum of columns
    (9) and (10).

    C1.8

    Column (12) is the total estimated Total Cost or the sum of columns (5) and
    (11).

    C1.9

    Column (13) is the unit cost for each item of works, determined by dividing
    the estimated Total Cost in column (12) by its total quantity in column (3).

    C.2 Procedures in preparing, processing and corresponding signatories specified under


    Department Order No. 163, Series of 2015 in the preparation of Program of Work
    (POW) and Approved Budget for the Contract (ABC) shall be observed.
    Since the
    bid prices
    approved
    quantities

    ABC is to be compared with the Contractor's bid and is the ceiling for acceptable
    in accordance with the provision of R.A. 9184, the ABC should be based on the
    Bidding Documents for the contract which contain the same work items and
    as those to be used by the contractors in preparing their bid.

    DPWH estimators shall continuously update their information/statistics on market prices of


    all construction inputs submitted for incorporation in the quarterly Construction Materials
    Price Database (CMPD). All assumptions in generating the estimate should be shown in the
    cost analysis.
    In all cases, estimates for special items of work (SPL) should be accompanied with plans and
    specifications, methods of construction, measurements and payments duly approved by the
    Bureau of Research and Standards (BRS).
    This Order shall take effect immediately
    Series of 2015.

    ~w---MARK A. VILLAR
    Acting Secretary
    6,1
    Department 01 Public Works and Highways
    Office 01 the Secretary

    1111111111111111111111111111111111111

    WIN6W01961

    and shall supersede Department

    Order No. 22,

    ;~

    APPROVED BUDGET FOR THE CONTRACT

    DD~~~
    __.

    Stations
    Length
    Contract Duration :
    ITEM NO.

    DESCRIPTION

    (1)
    PART A FACILITIES

    (2)

    QUANTITY

    (3)

    UNIT

    (4)

    ESTIMATED DIRECT
    COST
    (5)

    MARK-UPS
    OCM
    (6)

    IN PERCENT
    PROFIT
    (7)

    TOTAL MARK-UP
    %
    (8)

    VAT

    TOTAL INDIRECT COST

    (9)

    (10)

    (11)

    (12)

    (13)

    (5)x(8)

    5%[(5)+(9))

    (9)+(10)

    (5)+(11)

    (12)/(3)

    VALUE

    FOR THE ENGINEER

    TOTAL COST

    ~
    TOTAL OF PART A
    PART B OTHER GENERAL

    REQUIREMENTS

    TOTAL OF PART B
    PART C EARTHWORKS

    TOTAL OF PART C
    PART D SUBBASE AND BASE COURSE

    TOTAL OF PART D
    PART E SURFACE COURSES

    TOTAL OF PART E
    PART F BRIDGE CONSTRUCTION

    TOTAL OF PARTF
    PART G DRAINAGE AND SLOPE PROTECTION

    STRUCTURES

    TOTAL OF PART G
    PART H MISCELLANEOUS

    STRUCTURES

    TOTAL OF PART H
    TOTAL

    UNIT COST

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