Primary Author: Ms Dileezaa Lurthanathan
Co-Author(s): Ms Rahmah Idris
Audience Focus: Intermediate
Application Type: Application
Venue: 2015 AACE International Annual Meeting, Las Vegas, NV, USA
Abstract: Value of Work Done (VOWD) is a project control method of measuring actual cost achieved for an activity in projects of many different magnitudes, and has substantial impact in the oil and gas industry. Physical progress can be earned at a different time from the actual payment made. This emphasizes the importance of accrual accounting. It allows accurate reporting of committed cash, based on actual physical progress, which consequently steers stakeholders’ key decision making in ensuring continuity and feasibility of an investment. This paper will primarily focus on different methods of VOWD measurement based on planned value, milestone payment and actual physical progress for an upstream development project encompassing all execution activities (Detail Design, Procurement, Fabrication, Installation, Drilling and Commissioning). Results of this study will demonstrate with detailed tracking of contractor’s progress, VOWD based on actual physical progress has a higher level of accuracy in reporting actual cost achieved to-date.
Co-Author(s): Ms Rahmah Idris
Audience Focus: Intermediate
Application Type: Application
Venue: 2015 AACE International Annual Meeting, Las Vegas, NV, USA
Abstract: Value of Work Done (VOWD) is a project control method of measuring actual cost achieved for an activity in projects of many different magnitudes, and has substantial impact in the oil and gas industry. Physical progress can be earned at a different time from the actual payment made. This emphasizes the importance of accrual accounting. It allows accurate reporting of committed cash, based on actual physical progress, which consequently steers stakeholders’ key decision making in ensuring continuity and feasibility of an investment. This paper will primarily focus on different methods of VOWD measurement based on planned value, milestone payment and actual physical progress for an upstream development project encompassing all execution activities (Detail Design, Procurement, Fabrication, Installation, Drilling and Commissioning). Results of this study will demonstrate with detailed tracking of contractor’s progress, VOWD based on actual physical progress has a higher level of accuracy in reporting actual cost achieved to-date.