Audit of Construction Projects

Focus and Features

In order to support the growing business, most companies often encounter the need to invest in additional infrastructure, be it in new facilities or expanding current facilities. As these construction projects involve huge sums of capital expenditure, there is a critical need to safeguard the company's investment by ensuring that construction projects are well-controlled as with any business operations. Both internal auditors and project teams need to be equipped with the right capability and tools to design and execute construction site audits and consults commensurate with the risks involved.

This program provides a basic understanding of Construction projects auditing principles and tools both for auditors as well as non-auditors with internal control responsibilities. The methodologies include a combination of lectures, case studies and group discussions to provide a comprehensive learning process.

This is intended to be a basic* overview course to help get internal auditors started on construction project audits. This is also applicable to anyone who is simply interested in the construction process – whether on a large-scale (such as when you are handling a big project) or on a smaller scale (such as when you are planning to build your own home).

What You Will Learn

The program will enable participants to learn and/or apply the following:

Construction Audit Overview

• Common Construction and Related Risks
• Basic Construction Terms
• Project Size and Complexity
• Audit Perspective
• Construction Project Types
• Types of Construction Agreements
• Construction Project Organization
• Construction Project Stages Overview

Construction Audit Execution

• Types of Construction Audits
• Audit Timing
• Choosing the Right Project to Audit or Audit Prioritization
• Planning & Conducting the Audit
• Project Financials in relation to Audit Scope
• Improving Audit Efficiency thru Information Technology
• Audit of Design and Architectural Costs

Auditing Construction Costs

• Pre-Construction Costs
• General Condition and General Requirement Costs
• Subcontractor Costs
• Change Orders as Significant Project Risk
• Contractor Self-Performed Work
• Labor and Labor Burden Costs
• Equipment Rental Costs
• Insurance and Bonding Costs
• Owner Construction in Progress Accounts

Auditing Construction Processes, Policies, Procedures & Controls

• Project Progress Monitoring
• Contractor and Subcontractor Bidding and Award Process
• Contingency Funds Control
• Construction Polices & Procedures
• Project Closeout Process

Other Construction and Audit Considerations

• Cost Control and Financial Value Engineering
• Construction Claims

Who Should Attend

The seminar is ideal for internal auditors in the construction and real estate industry as well as those auditors from other industries (manufacturing, power, energy, mining, utilities, communication, electronics, conglomerates, etc.) that provide assurance and consulting work on various construction projects. It is also valuable for project managers/team members and risk professionals who do not perform audit work but hold stewardship responsibilities. This is also a general course for anyone interested to know about the construction process.