Future Students - Courses

Cost Engineering

Unit Code: HES5175

Duration	Contact Hours	Campus	Prerequisite	Corequisite
1 Semester	48 hours	Hawthorn, Sarawak	175 credit points	Nil

Credit Points: 12.5 Credit Points

Related Course/s:

A unit of study in the Bachelor of Engineering (Civil Engineering) and Bachelor of Engineering (Civil Engineering)/Bachelor of Commerce

Aims & Objectives:

The unit aims to introduce the student to the principles and practices of Total Cost Management, and their application to establish, maintain, and achieve time and financial budgets for engineered projects.

On completion of this unit, students should be able to:

Understand the various steps in the life cycle of a project, from concept through evaluation, Go/No Go decisions, execution (engineering & construction), start up and commissioning, operation & maintenance, etc to the end of life activities
Recognise the five basic project delivery systems used for project execution, the varying contractual and commercial relationships generally associated with each system, and the advantages / disadvantages of each system
Recognise some basic aspects of engineering economics, including the various measures used to evaluate potential projects or compare financial alternatives (eg NPV, NFW), ROR using DCF techniques, and Benefit Cost analysis, cash and investment flows, inflation and escalation, foreign exchange and hedging
Measure basic quantities using AS 1181 - 1982 Method of measurement of civil engineering works and associated building works, and prepare Bills of Quantities
Prepare bar (Gantt) charts and logic networks for project execution and manually analyse networks to determine critical paths
Recognise the various categories of costs which will be incurred during project execution, including quantity-proportional direct costs (direct labour, construction equipment operating and ownership costs, temporary and permanent equipment and materials, specialist subcontractors), time based and fixed indirect project costs, allowances, contingencies, and mark ups for corporate overheads
Examine the various levels of cost estimates prepared during the development of a projects (eg Order of Magnitude/ Preliminary/ Definitive/ Detailed), the different method of preparation used for each level, and the expected accuracy at each level
Recognise the key commercial terms of commonly used contract forms, particularly AS 2124 and the AS 4000 series, including tendering provisions
Describe the difference between the 'permanent works' required for a project and the often extensive 'temporary works' required for its execution
Describe such techniques as Risk Analysis (AS/NZS 4360-1999), Life Cycle Costing (AS /NZS 4536-1999), Value Analysis, Earned Value, cost codes, WBS, learning curves, etc
Understand that a reliable and comprehensive source of technical data on project execution is contained in journals and transactions of professional engineering bodies such as The Institution of Engineers Australia, the American Society of Civil Engineers, the Institution of Civil Engineers UK, etc

Teaching Methods:

Lectures (24 hours), Tutorials and Computer labs (24 hours)

Assessment:

Assignments (50-60%) and Exam (40-50%)

Generic Skills Outcomes:

In this unit, students are expected to enhance the Key Generic Skills below as recognised by Engineers Australia. The Unit Outline explains how these outcomes will be achieved.

Ability to apply knowledge of basic science and engineering fundamentals
Ability to communicate effectively, not only with engineers but also with the community at large
Ability to undertake problem identification, formulation and solution
Ability to utilize a systems approach to design and operational performance
Ability to function effectively as an individual and in a multi-disciplinary and multi-cultural teams, with the capacity to be a leader or manager as well as an effective team member
Understanding of professional and ethical responsibilities and commitment to them
Expectation of the need to undertake lifelong learning, and capacity to do so

Content:

Projects & project life cycles, from origins to obsolescence
Project Delivery Systems & commercial options
Introduction to engineering economics
Measurement of Quantities (Australian Standard AS 1181)
Work planning & the development of crews and production rates
Work scheduling (bar charts / CPM / PERT)
Cost Estimation (Order of Magnitude / Preliminary / Definitive / Detailed)
Commercial aspects of Standard Conditions of Contract (AS 2124 and AS 4000 series)
Preparation of bids / tendering / tender evaluation / contract award
Time & cost control during project execution and ongoing activities
Supporting cost engineering techniques

Reading Materials:

Course notes are available at the beginning of the semester through the bookshop

Fails Management Institute Financial Management for Contractors, McGraw-Hill, New York, 1981.

Rogers, M., Engineering Project Appraisal, B Publications, 2001.

Reading materials as provided by the lecturer for specific topics