HDI?

Complete a Valuation
Issued August 2011

How
Do I Complete a Valuation?
Introduction
A Valuation is where, in a given Valuation Period, you decide how much
you are going to pay your subcontractor the internal costs - and apply
to the client for payment for the value of the project - the external
value - according to the percentage of work accomplished.
The Projectsheet is calculated based on the current Valuation Period that
has been set for the Projectbook.
Much of what you can do in Valuations depends on the way your
Projectbook has been set up. For example, the percentage over
certification permitted and whether retention is applied before discount.
These are setup on the Module configuration screen.

Before you begin

The following setup details are described in the document HDI...? Setup
Valuations:

Valuations User Rights

Internal Valuations and External Applications/Certifications

Creating Valuation Periods

Module Configuration

Internal Valuations
This is where the Main Contractor values and certifies the Trade Contract
items and certifies any Subcontract Applications that have been made in
the current Valuation Period.
The amount of the submitted application is shown in the Projectsheet in
the Application to Date column.
The amount that is agreed to be paid certified is shown in the
Certified to Date column.
If the Subcontractor does not have access to Commercial Management,
the applications can be made offline to the Main Contractor who then has
2 options:

enter the applications on the Subcontract Applications screen; or

enter the amounts and certify them directly from the Internal
Valuations screen.

This latter procedure automatically creates a subcontractor application

which is listed on the Subcontractor Applications screen.

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Listing the Internal Valuations

From the navigation panel select
>
>
. Here you can see each of the applications made for the current
valuation period.
To view previous valuation periods, click on the filters
and make a selection, for example:

... and click on the

button

button.

The applications on the Internal Valuations listing screen may have one of
these statuses:

Submitted the contract has been valued and saved, but not yet
certified

Certified the application has been certified

Superseded another application was made for the same order

after this one in the same valuation period

Skipped only the latest application in the same valuation period

can be certified, any previous applications are marked skipped

Rejected the application has been rejected

Click on the link in the Status column to view the details of the
application.

Valuing a Trade Contract

If the application already exists go to the
>
screen, find the Trade Contract to be valued and click on the
button in the last column.
To create a new application to be valued, go to
and select the Valuation Period and Company.

edit
>

The Trade Contract selection box contains only the orders placed with
the company you selected. Then click on
.

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General details about the application are shown at the top of the next
screen, followed by a summary detailing the previous and current values
of the certificates, for example:

This table describes each of the fields in the summary and how they are
calculated:
Column Name Description

Formula

Gross Total

The application gross amount before

The sum to date of all line items in the
the deduction of retention or discount application

Retention

This is a percentage or amount of the

Gross Total

Sum of the Retention column on all line

items in the application

Discount

This is a percentage or amount of the

(Gross Total - Retention)

Sum of the Discount column on all the

line items in the application

Net Total

The net amount after the deduction of Sum of the Net To Date column on all
any retention and discount
the line items in the application

This
Certificate

This is the net amount applied for in

the current application

Current Certificate Net Total Certified To Date Net Total

Making an Application for Payment

Below the Summary is the Order List which you can expand to view the
line items in the Trade Contract. It is here you enter the values for
which you are applying.
The following example shows a contract with 3 line items totalling
500,000.
Expand the Order List to view the line items, for example:

You may enter values directly against individual line items, or you may
enter a summary amount to be applied to ALL the line items.

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Issued August 2011

At the top of the Order List, above the first Line Item, are three
summary fields. If you enter any values here, they are applied to ALL
the line items:

The following description assumes you are entering values for individual
line items:

To make the application, you may enter:

the quantity in the Certified Quantity To Date field; or

the percentage of the work completed in the Certified

Percentage To Date field; or

the amount for which you are applying in the Certified Amount
To Date field

you may also enter a percentage value in the Retention field

... against the appropriate Line Item.

The values are calculated automatically. In this example, 50 is entered
in the Certified Percentage to Date field and 10 in the Retention field for
the first Line Item:

The values are calculated and the Summary is updated accordingly:

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You may certify this application immediately or save it so you can return
and make any changes.
the valuation is listed with a status of Submitted and
If you click
the value is entered into the Projectsheet in the Applications to Date
column.
the valuation is listed with a status of Certified
If you click on
and you cannot edit it. The value is entered into the Projectsheet in the
Certified to Date column.
If you move to the next Valuation Period before you Certify the
application, the application does not appear in the Internal Valuation
listing unless you use the filters to view the applications made in the
previous valuation period.
Once you have found the application, you can click on it, and edit it and
certify it, in the previous valuation period.

The External Application

While you are on the Internal Valuation screen, and if you have External
Values switched on for your Projectbook, you will see a link to add an
External Application for the Trade Contract you are currently valuing:

You can click here to go straight to the External Applications screen.

If you have Certified the Internal Valuation, those figures are pulled
through to the External Application screen and recalculated ready for you
to edit them and make an application to the Client.
The Certified Percentage To Date on the Internal Valuation screen is
applied to the value on the External Application screen so unless the cost
and value of the Trade Contract are equal, the amounts shown on the
External Application screen will be different to the amounts on the
Internal Valuation screen.
The External Application screen works in the same way as the Internal
Valuation screen, except that when you have entered the percentage or
or, instead of
value of the work completed, you either
Certifying,
the application to the Client for payment.
When you submit the application, the value appears in the Projectsheet
in the Applications to Client column.

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The Next Valuation Period

You move onto the next valuation period from the
>
screen where you select
This is described in HDI...? Setup Valuations.

>
.

Using the same example as shown above, in the next valuation period
you may want to make an application for 20% of the Phase 2 Demolition
which is in Line Item 2:

The values are calculated and the summary updated:

Click on

or

Again, if you have External Values setup for the Projectsheet, you may
go directly to the External Application screen to submit an application to
the Client:

Materials On/Off Site List

Sometimes there is a requirement to record, value and pay for materials
that have been purchased by the Subcontractor but which have not yet
been used. These materials, such as bricks and timber, are stored on or
off the construction site.
As the project progresses and the materials are used during the
construction process, the value of the on/off site materials decreases.
Subcontractors can make Applications from the Subcontractor
Application screen for these materials. Alternatively, these items can be
valued and certified directly by the Main Contractor from the Internal
Valuation screen. The following examples use the Internal Valuation
screen.
The Materials On/Off Site line items are displayed below the Order List
on the Internal Valuations screen and have no effect on the value of the
order.
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A simple example of using Materials On/Off Site

A Trade Contract is placed against Cost Code A2300 for Brickwork with a
value of 10,000.
Create a Valuation in the current valuation period for this trade contract.
Go to
>
, select the Valuation Period and
Trade Contract and click on
.
On the Internal Valuations screen, click on

The Trade Contract is for 10,000 and represents the finished brickwork.
Although no construction work has been done in this valuation period,
you can value and certify the value of the bricks that have been
delivered to site so far for example 2,000.
When the above example is created, the following is shown in the
Material On/Off Site List:

Now you can certify this amount by entering the amount in the Certified
Amount to Date box:

and click on

. The amount in the summary is updated.

In the next Valuation Period, when a proportion of the materials on site

have been used in the construction, you can continue to value and certify
the order items and adjust the valuation of the materials on site
according to the percentage used.
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In subsequent valuation periods the value of the materials on site reduces

as the materials are used. The amount may not actually reach zero as
some materials may be left over. If this happens, you may decide to
raise an Instruction or Change Request to buy the excess materials.
The value of the Materials on/off site cannot be negative, but can be
zero.

Change Item List

In addition to Trade Contracts and Materials on/off site, you may value
Change Items.
Any Change Items associated to the order with a Budget Change Status of
Approved are listed at the bottom of the Internal Valuation screen, for
example:

You can certify payment for these items by entering amounts for
Quantity, Percentage and Amount in the same way as for Orders
described above.
The amount entered against Change Items is added to the amounts
entered for Materials On/Off Site and Orders. The totals are shown in
the Summary at the top of the screen.

External Applications
If your Projectbook is set up to track External Value, this is where the
Main Contractor can make applications for payment to the Client.
The process whereby you click on a button from the Internal Valuation
screen to create an External Application:

... has already been described.

You can also go directly to the External Application screen from the
Navigation panel:

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From here you can list, view and edit existing Open applications and view
any Submitted Applications for the current Valuation Period. Use the
button to view Applications from other Valuation Periods.
The method of entering amount for the application is the same as
described for Internal Valuations with the exception that you are
applying to the Client for payment for the value of the work completed
instead of certifying payment to the subcontractor for the cost of work
completed.

External Certifications
This is where the Client can certify the application for payment made by
the Main Contractor by accessing the External Certification screen.
If the Client does not have access to conject Commercial Management,
the Main Contractor provides the Client with submitted applications
outside of Commercial Management. Once certified, the Main Contractor
records the certified amounts on the External Certification screen in
Commercial Management.
>
>
From the navigation panel select
to view the Submitted External Applications made in the current
Valuation Period. Click on the status link of the submitted application
you want to Certify.
The External Certification Details screen displays a summary showing the
values of the Current and Previous Certificates and the total amount
Certified to Date.
The method of entering amounts for the certification is the same as
described for Internal Valuations with the exception that you are
recording the amounts the Client has certified to pay the Main Contractor
for the value of the work completed instead of certifying payment to the
subcontractor for the cost of work completed.

Effect on the Projectsheet

The values of the External Certifications are shown in the Projectsheet in
the Certified by Client column.

Valuation Reports
There are a number of reports available to help you manage and monitor
the valuation process. These are found under the
option in
the navigation bar:

For each report you can specify:

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The report output format HTML, PDF, Excel or xml file

A report title

A printed title page

Paper size

Depending on the report you are running, you may also be able to specify
combinations of options such as:

Valuation Period

Trade Contract

Trade Contract Company

Cost Codes and Cost Code Groups

Figures for Cost (internal) or Value (external)

More Information
How Do I?

Complete the Initial Budget

Create and Read a Projectsheet

Create Commercial Management

Reports

Place a Trade Contract

Setup Valuations

Make Subcontractor Applications

Setup and Use Client Contracts in

Valuations

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User Guides

Getting Started with Commercial

Management

Change Management

Commercial Management Glossary

Commercial Management Security

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