Investment and Construction Consultancy

Terekhov
Alexey
Partner, FBKs Vice-President for Audit and Consulting Services to Financial Institutions
+7 495 737-5353
Sadovnikov
Igor
Head of FBK's Development&Constuction Consultancy Department
+7 495 737-5353
The construction industry is one of the most profitable sectors of the country economy, consistently attracting the interest of investors. At the same time, the industry is difficult for an investment, it has its specifics. A variety of different legal frameworks, a large number of participants in the implementation of projects create risks; conditions arise for increasing the cost and terms of construction, and a whole range of various problems in the implementation of a construction project.
Investors are interested in the stability, predictability, minimization of construction terms and capital expenditures.
Knowledge of the law, understanding of the relationship among legal frameworks used in construction and their correct application when creating a construction product is the key to success in the investment project implementation with the lowest funds invested. For examining the construction projects in terms of their investment attractiveness, the legality of construction, the terms of implementation and control over the targeted use of the allocated funds the FBK company has the Department of investment-construction expertise, which protects the economic interests of the client and provides for the investment management process.

You should apply for the services of specialists of the FBC Department of investment construction expertise if:

  • in the implementation of a construction project problems and errors would arise and you want to prevent them but not to solve in the process of construction;
  • you do not trust the contractors and want the construction to be clear and in accordance with the law;
  • you believe that the cost of construction works is overestimated and want to know about that at the initial stage of construction but not to solve the problem of shortage of funds committed in the project budget during its implementation;
  • you are not satisfied with the quality of construction and want to obtain a high-quality construction product but not to perform unscheduled work on eliminating the defects;
  • you doubt the feasibility of the deadlines of construction and do not want them to be thwarted;
  • there is a feeling that you do not have complete information on the project and want to know everything about the investment project implementation, including the «pitfalls»;
  • you are not sure that all the funds intended for the construction were used in accordance with their intended purposes and you want the financing facility to be to the target and fully transparent to you.
The FBK Department of investment and construction expertise is ready to render assistance in solving all the issues and problems arising at the investment projects different stages of implementation.

What we can help you with in having the projects implemented:
  • enforce the performance under the plans of construction strictly observed;
  • implement the project that meets the requirements of the design and technical-normative documentation;
  • control the spending of funds allocated towards the project implementation;
  • avoid unjustified overstating of the value and volume indicators of the construction project;
  • reduce project risks by means of continuous monitoring of the project progress against the planned indicators;
  • identify negative factors, which may affect the project in the future.

What we can tell you about your project:
  • information about the overall cost of the investment projects implementation and the amount of costs required to complete the projects and commission the facilities (often the cost of construction is overstated significantly or does not cover all costs thus being understated);
  • confirmation or doubting of the fact that the funds are disbursed in accordance with the planned target – towards the implementation of projects (or the funds are expended on other purposes);
  • the objective information about the progress in the project implementation (performance in percentage; timely/untimely receipt the required documentation; backlogs (if any) against the targets, compliance/non-compliance of payments with the financing schedule, good quality/poor execution of construction works etc);
  • timely identification of risks affecting the course of investment projects implementation (inflated cost, backlog against the schedule, construction defects, etc) and the action plan for their reduction or closure in order to make effective managerial decisions on crediting or further financing.

Our department’s key competitive benefits:
  • Comprehensiveness. FBK is a member of SRO Stroitelny Resurs, non-profit partnership, that is certified for admission to works on construction control. We do not only estimate but also control the quality of construction works.
  • Experience. The FBK department of investment-construction expertise actively operates in the field of consulting in construction and has accumulated wide experience of expertise in the investment construction projects, including those of large-scale and infrastructure, which are implemented with the involvement of state guarantees.
  • Qualification. The department of investment-construction expertise staff with their background in construction have long experience of working at the construction sites as well as the departments of expertise, estimates and quality of construction. Extensive knowledge, regular advanced professional training and the experience gained allow performing good quality works with the detailed implementation of all objectives set by the service customers.
  • High corporate culture, technologies, well-established techniques, quality standards and available personnel that meet the requirements of the market.
  • Projects detailed planning in close cooperation with the client
  • Confidentiality of the information provided
  • Observance of professional ethical principles such as independence, integrity, objectivity, professional competence
  • Lack of affiliation allows approaching any professional issues objectively, impartially and independently
  • Availability of an effective internal quality control system approved by professional associations with FBK’s membership.


Investment and construction consultancy is aimed at streamlining investor’s expenses when implementing investment projects.

The following procedures are carried out within investment and construction consultancy:
  • value audit;
  • construction audit;
  • valuation of investment projects;
  • estimation of investment value of construction objects.

Value audit is comprehensive review of technical and financial documents aimed at finding out issues affecting the value of investment project, as follows:
  • mistakes in calculation of value;
  • expenses unduly included in the bill of quantities or acts on acceptance of the work implemented;
  • overstated cost of work, raw and services comparing to the average market prices;
  • overstated scopes when drawing up cost estimate documentation and with regard to actual work carried out at the project site;
  • non-earmarked disbursement of funds;
  • applying overstated coefficients, rates and pricing when generating value;
  • etc.
Value audit may include the following kinds of work:
  • analysis of value of investment projects allowing to reveal mistakes at the initial stage of project implementation and irregularities when estimating value of construction (including excessive expenses in value, overstated cost of work etc.);
  • review of cost estimate documentation in terms of compliance with scope of work in project documentation, review of as-built documents (forms KC-2, -6) in terms of compliance with the scope of work actually performed ;
  • review of cost estimate documentation in terms of compliance of applied rates, coefficients and pricing with statutory standards;
  • analysis of procurement prices of raw and construction when drawing up the cost estimate in terms of their compliance with average market showings;
  • analysis of procurement prices of equipment in terms of their compliance with average market showings;
  • revision of earmarked disbursement of funds;
  • other kinds of work.

Construction audit includes the following kinds of work:
  • review of availability and completeness of initial permissive documentation and documents of title;
  • review of comprehensiveness of design and estimate documentation (control over timely elaboration);
  • review and control over schedules of work(implementation of investment projects);
  • control over quality of construction and installation activities and over construction materials, units and constructions used;
  • control over scope of construction and installation activities implemented;
  • revision of completeness of as-built documentation at construction site in terms of compliance with regulatory documents effective in the territory of the Russian Federation;
  • revision of compliance of technology of implementation of construction and installation activities at the construction object with technology in the working plan
  • other kinds of work.

Independent construction audit shall provide timely revelation of problems when implementing construction projects, as follows:
  • unjustified increase of budget and terms of construction;
  • mistakes made when designing and executing work;
  • low quality implementation of construction and installation activities;
  • low quality of control and coordination of processes;
  • failed liabilities performance by the counteragents;
  • unavailability of documents required;
  • etc., which in their turn cause increasing expenses and hinder the whole implementation of construction project.

Problems timely revealed and procedures elaborated to decrease their impact on the project allow the Client to make optimal managerial decisions and control investments.
Efficiency of investment and construction consultancy (revelation of value overrated) makes up to 10-20 percent from the amount of investments.

Investment projects valuation
Within valuation of investment projects appraiser conducts review of efficiency of investment projects by means of calculating basic showings of internal rate of return, net present value, payback period etc. Review of the showings allows investor to make conclusion regarding feasibility of investing into one or another project.

Estimating investment value of construction objects
When estimating investment value of valuation objects the value for a certain entity or a group of entities is estimated when the investment objectives of exploitation of the valuation objects are determined.

Contact information:
Tel.:+7 495 737-5353

Igor Sadovnikov, Director of FBK's Development&Constuction Consultancy Department: SadovnikovI@fbk.ru

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