Improving Security of Payment Building and Construction Industry

10. Prequalification Page 121National Public Works Council IncImproving Security of Payment in the Building and Construction Industry• Financial capacity covers the provision of information including:- audited financial statements where available or other financial reports orreferences;- financial references from past clients; and- turnover information for the last two years and current year projection.Smaller Projects• Designed for smaller projects which fall below the $5 million Head Contractorcut-off. All elements may not be utilised unless the tender value exceeds$250,000.• Areas covered are the same as for Head Contractors ,although the level ofinformation required is reduced.• Information required for the purposes of technical and financial capacity issimilar to that required for the Subcontractors version.Consultants• Covers the requirements for consultancies in excess of $250,000.10.4 Sources of InformationPrequalification will only be effective where current information is available, particularly inrelation to financial prequalification criteria.Current and historical financial information is available from two sources:• Internally, provided by the Contractor being assessed; and• Externally, from third party agencies.10.4.1 Internal Sources of InformationInformation provided by Head Contractors themselves will vary in quality and itsveracity will need to be independently evaluated from time to time. However,internally provided information should be current and not historical and should beable to be provided on a timely basis.Principals, in seeking to prequalify Head Contractors, are able to demand provision ofcurrent (and accurate) financial information due to their economic position in thecontractual chain. Head Contractors will provide such information as is necessary inorder to prequalify. Also, there should be no difficulty in arranging for anindependent evaluation of the financial information provided by Head Contractorsthemselves.