AN APPRAISAL OF COST CONTINGENCY MANAGEMENT PRACTICES FOR BUILDING PROJECTS IN NIGERIA
Publication Date : 01/08/2012
Contingency funds are included in project estimates to manage risks and uncertainties so as to achieve project objectives. This paper presents results of a research work on management of contingency fund for building projects in Nigeria. A total of 100 questionnaires on projects cost contingency were randomly distributed to project managers. Sixty seven (67) completed questionnaires were returned. Analysis of the responses indicates that, in many organizations, there is a lack of formal policy or guidelines for the management of project cost contingency. Furthermore, 12% of the respondents do not monitor the use of contingency fund; also 37% do not review the accuracy of contingency allowance at the completion of projects. The study also shows that, the major problem encountered in the management of contingency fund is that, more often the fund is inadequate to cater for all the risks and uncertainties associated with projects. To improve cost contingency management practice, it is recommended that, organizations should establish a policy or guideline for management of contingency fund.
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