PCC Contract Management & Procurement Flashcards

Which contract type places the most financial risk on the buyer?

Answer: Cost-plus-fixed-fee

Cost-plus contracts reimburse all allowable costs, so the buyer bears the risk if costs exceed estimates.

In project controls, a procurement baseline is used primarily to:

Answer: Track vendor performance against contracted deliverables and costs

The procurement baseline measures actual vendor cost and schedule performance against what was contractually agreed.

What document formally authorizes a seller to begin work on a contract?

Answer: Notice to Proceed (NTP)

A Notice to Proceed (NTP) is the official authorization issued to a contractor to begin work under the contract.

Which procurement document provides the most detailed technical and administrative requirements for a project?

Answer: Statement of Work (SOW)

The Statement of Work (SOW) defines in detail the work to be performed, deliverables, schedule, and technical requirements.

A project controller reviewing contract terms notices the contract includes a liquidated damages clause. This clause is intended to:

Answer: Compensate the owner for losses if the contractor misses key milestones

Liquidated damages are pre-agreed financial penalties assessed against the contractor for schedule delays that cause owner losses.

In contract administration, a change order is best described as:

Answer: A formal amendment modifying the contract scope, schedule, or cost

A change order is a mutually agreed formal modification to the contract that adjusts scope, cost, or schedule.