A Study On The EPC Project Cost Management Of D Company

In the engineering field of China, EPC contracting mode has entered the stage of rapid development. However, the general contractors of China still have some problems in cost management in EPC-contracted project. Therefore, studying into the experiences of ongoing projects of EPC contractor will be practically significant for improving the cost management capability of EPC projects, and promoting the development of the company.At present, there are three general categories of EPC contractors in China: contractor converted from large construction company, contractor converted from design institute and contractor in form of Consortium. This paper mainly studies D Company which is converted from design institute. It probes into the cost management modes, methodology and the status of each project stage of EPC project of D Company from full-dimensional perspective. Based on the above illustration, this paper points out the deficiencies in the cost management of the company with reference to fundamental theories, such as target management theory, cost estimate theory, company governance theory, supply chain management theory, construction management theory and so on. Then, it analyzes and reveals the causes for the cost management problems of D Company with cost management theory, incentive theory and tendering/bidding theory as guidance. Finally, this paper employs fundamental theories and knowledge of economics and management, such as dynamic management principle, information technology theory of enterprises, tax planning theory, value engineering theory, project site management theory, etc. and proposes possible countermeasures to address the deficiencies in cost management of EPC projects and for promoting the cost management capability of EPC contractors: identifying the characteristics of cost management of EPC projects, understanding principles for effectively controlling the cost of EPC projects, promoting information technologies, nursing multi-skilled talents, increase the cost estimate at pre-phase of projects, reasonably applying tax shelter, performing design optimization, regulating procurement, developing strategic partners, sub-contracting labor without materials during project execution, strengthening control over design modification and signing procedure, prudently checking the final accounting of construction company at late phase of projects, actively and spontaneously preparing final accounting with clients, and so on.