Terms of Reference for GFI’s and IPA’s

e. The Estimated Indirect Cost shall consist of the following items based on accepted construction industry practices:

(1)	Overhead Expenses not exceeding eight percent (8%) of the EDC, which include the following as included;
	(a) Engineering and Administrative Supervision, including expenses for the office equipment's and supplies, power and water consumption, communication and maintenance;
	(b) Transportation allowance;
	(c) Premium on Contractor's ALL RISK insurance, where necessary; and
	(d) Financing cost, e.g., premium on bonds.
(2)	Contingencies and Miscellaneous not exceeding four percent (4.0%) of the EDC. These include expenses for unforeseen events and other activities.
(3)	Contractor's Profit Margin not exceeding eight percent (8%) of the EDC for projects with an EDC of more than PhP 5 million and ten percent (10%) for projects with an EDC of PhP 5 million and below.
(4)	Value Added Tax (VAT) Component in accordance with law, five percent (5%) in the case of a property owned by a government agency, or twelve percent (12%) in the case of a property owned by a private party, of the sum of the EDC, Overhead, Contingencies, Miscellaneous, and Profit.