Prior to accepting the works (i.e., prior to the Owner certifying that Practical Completion has occurred), the Owner can seek information that reconciles scope, service level and actual outturn cost between the TOC and the Owner's VfM Statement. Any variations should be explained with reference to innovation, risk profile, performance levels or changes. In this way the alliance can concentrate on demonstrating that the objectives of the VfM Statement have been delivered and remedying any remaining gaps or issues.
This information has the additional advantage of ensuring clarity and alignment for all Participants on their respective objectives at the time of Practical Completion when the project will likely move into an operation phase. This work by the alliance at this time will also feed into the Owner's VfM Report to be produced post-completion for the government and validated independently by parties separate from the alliance. Such a validation of the VfM Report will usually be undertaken by specialist commercial adviser that has been engaged by the Owner.
The PAA will continue through the defects liability period up until Final Completion. Prior to the Final Completion Certificate being issued, the Financial Auditor should undertake a final audit of all Reimbursable Costs. This should include a reconcilation of actual and estimated allowances (for such matters as staff bonuses and annual leave), non-cost performance and salvage value of capital assets to produce a statement of the final Risk or Reward Amount against the Final (adjusted) TOC.
At project close-out the AOC can be finalised. The AOC for the project is the actual total cost for the delivery of the alliance works by the alliance inclusive of NOPs fees and reimbursable costs to the NOPS and the Owner. Refer to Guidance Note No 4 for further discussion.
| Alliancing can provide a powerful problem solving environment If an alliance is established well with appropriate commercial arrangements and supporting culture, it is a powerful environment for problem solving. As issues and risks emerge through the project life, the alliance members focus on collectively resolving issues rather than attributing blame. |
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62 Note that this independent validation refers to informed scrutiny that is independent of the alliance; and should not be read as a reference that the Owner needs to necessarily engage external advisors to carry out this validation.