The term ‘on-costs’ has suffered from a lack of clear and consistent definition in the industry. Depending, for instance, on the client’s view of the project and their accounting practices, on-costs can range from the bare minimum of design fees to the full range of the client’s costs associated with a particular project.
This isurv section does not attempt to specify what should or should not be included in on-costs. Instead, it aims to identify the range of costs that might be included in a checklist of costs included in a stated on-cost for a particular project. Actual practice will continue to vary from client to client, but a defined checklist will help to clarify what is and is not included in a stated on-cost.
This section also proposes a definition of construction costs, a list of additional costs that might be included in on-costs, and an indication of costs that relate to the clients use of the asset. It is written in the context of allocating costs on a completed project. It refers to various rules of measurement and contract types in its treatment of the topic.