The term ‘on-costs’ has suffered from a lack of clear and consistent definition in the industry. For example, depending on the client’s view 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 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 stated on-cost for a particular project. Actual practice will 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 client's use of the asset.