PT.

REKA PATRIA EKAGUNA

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CONTRACT/PO REVIEW, ACCEPTANCE & HANDOVER
PROCEDURE Date : 03 Oct 2013

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DOCUMENT NO. QHSE-REKA-BD-103

CONTRACT/PO REVIEW, ACCEPTANCE &

HANDOVER PROCEDURE

PROCEDURE OWNER: BUSINESS DEVELOPMENT

 Copyright. This document is the property of PT Reka Patria Ekaguna and all rights are reserved in respect
of it. This document may not be reproduced or disclosed in any manner whatsoever, in whole or in part,
without the prior written consent of PT Reka Patria Ekaguna. PT Reka Patria Ekaguna expressly disclaims
any responsibility for or liability arising from the use of this document by any third party. Copies printed
from Quality Management Systems folder are UNCONTROLLED.

PREPARED CHECKED BY APPROVED BY

REV DATE
B&D QMR Legal Director Pres. Director

Oct
08 Besse M Anggit Indah Y Indra L S Dr. Arlan S
2013
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AMENDMENT RECORD SHEET

REVISION PAGE DESCRIPTION

06 All - Separated from marketing procedure due
to change QMS documentation structure
from departmental approach using process
approach.
- Additional board of expertise during
contract review.
- Additional Flowchart

07 All Procedure separation between PT. Reka Patria

Ekaguna (RPE) and PT. Raga Perkasa Ekaguna
(RGA)

08 All Renamed, was Contract Review Procedure,

revised

1. PURPOSE
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This Procedure describes the review process of a new Contract or Purchase Order
when awarded to PT. Reka Patria Ekaguna (RPE) by a Client with the objective:

1.1. As a guide line for Reviewing & Accepting Contract or Purchase Order from
Customer.
1.2. Ensuring smooth handover of PQ, Tender, Proposal data from Proposals
Department to assigned Project Manager (via Operations Director) preventing
any discrepancies arising during Project Execution realization.

2. SCOPE

This Procedure applies for Review of new Contracts, Purchase Orders awarded to
RPE.

3. REFERENCE

3.1 ISO 9001: 2008 clause:

- 7.2.1. (Determination of requirements related to the Product)
- 7.2.2. (Review of requirements related to the Product)
- 7.2.3. (Customer communication)
- 8.4. (Analysis Data)
- 5.2. (Customer Focus)

3.2 ISO 14001:2004 clause:

- 4.3.1. (Environmental Aspect)
- 4.3.2. (Legal and Other Requirements)
- 4.4.7. (Emergency Preparedness and Response)

3.3 OHSAS 18001:2007

- 4.3.1. (Hazard Identification, Risk Assessment, and Determining Control)
- 4.3.2. (Legal and Other Requirement)
- 4.4.7. (Emergency Preparedness and Response)

3.4 Related RPE Procedures:

 Proposal Preparation Procedure QHSE-REKA-BD-102
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 PMS Project Execution Procedure QHSE-REKA-PMS-101

 Project Execution Procedure QHSE-REKA-ENG-103
 New Project Preparation Procedure QHSE-REKA-ENG-101

4. DEFINITION

4.2 EPC (Engineering, Procurement and Construction)

EPC Projects referred in this Procedure are generally EPC or EPCI construction
projects for Oil & Gas Facilities located Onshore or Offshore whereby RPE has
joined with a specialist EPC/ EPCI Company as a Sub-Contractor or as a
Consortium Partner with RPE scope being to execute the Engineering scope of work
and other Services as agreed.

4.3 FEED ( Front End Engineering Development)

FEED Projects referred to in this Procedure are where Client, normally an Oil & Gas
Production Sharing Contractor (PSC) who engages the services of a specialist
Engineering Contractor to complete a Front End Engineering package with sufficient
detail for it to be used for tender purposes. It is also complete with cost estimate for
the EPC project investment with quotations secured for Key, Long Lead Equipments.

4.4 BES (Blanket Engineering Services)

BES projects are to provide Oil & Gas PSC companies who require to use the
services of a specialist engineering company over a stipulated period (normally 2
years) to complete small engineering works related to modifications, maintenance,
small projects.

4.5 PMS (Project Management Services)

Project Management Services (PMS) is a core business for RPE established as

PMS Department to provide PSC companies with specialist Man Power for
stipulated positions over a term period of time, normally 2-5 years.

4.6 Project

EPC, FEED, BES & PMS are collectively referred to as Project within this Procedure.

4.9 Purchase Order

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Purchase Order (PO) process is normally used by Clients for smaller BES or PMS
requirements.

4.10 SAP System

SAP System is a Sales Accounting Software system introduced and operating in

RPE. Refer to SAP User Manual for operating procedure.

5. RESPONSIBILITY

5.1 Business Development Director

Business Development Director is responsible for the Business Development

Department whose sole objective is in achieving Business Targets for RPE.

5.2 Proposals & Estimation Manager

The Proposals & Estimation Manager is responsible for the management of the
Proposals Department and for the preparation of PQ or Tenders for Projects for all
business performed by RPE including PMS all in accordance with RPE Policy.

Departments where required all in accordance with RPE Proposal Preparation

Procedure QHSE-REKA-BD-102

The Proposals & Estimation Manager is also to ensure that the Proposal Department
activities follow this Contract/ PO Review, Acceptance & Handover Procedure.

5.3 Engineering Director

In respect of FEED & EPC Engineering & BES Contract Execution the Engineering
Director will be responsible for:

 All Technical aspects, including Technical Data & submissions related to the
PQ, Tender or Proposal.
 Assignment of Engineering Personnel.
 Assignment of Engineers (for the project Organigram)
 Confirmation of the man hours estimate prepared by the Operations Director.
 All other duties as per the RPE procedure QHSE-REKA-ENG-103 Project
Execution.

Above responsibility does not apply to PMS Contracts whereby PMS Manager will be
responsible except in cases whereby support of Engineering is requested.
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5.4 Operations Director

In respect of Project Execution for FEED, EPC Engineering & BES Contracts or
Purchase Orders the Operations Director will be responsible for:

 Assignment of Project Manager and all other personnel to the Project Team.
 Project man hour’s estimation.
 All other duties as per the RPE Procedure QHSE-REKA-ENG-103 Project
Execution Procedure.

5.5 PMS Manager

In case of PMS Contracts the PMS Manager will be responsible for the handling of
new Contract, or Purchase Order awards in accordance with RPE Procedure QHSE-
REKA-PMS-101 PMS Project Execution.

5.6 Project Manager (PM)

The Project Manager is RPE’s Authorized Representative for the overall

coordination, control and execution of the Project and for all coordination’s with the
Client Representative, RPE Project Team, Heads of Department, Managers & Sub-
contractors.

5.7 Project Engineer (PE)

The Project Engineer (PE), if appointed, reports to the PM and is responsible to

coordinate and control all activities relative to the Project including Cost Reporting,
Sub-Contracting and Purchasing Coordination’s.

Note: In case of BES, smaller EPC Engineering projects the PE may be elevated
to position of PM for that assignment only, with full authority of the position.

5.8 Project Services Group

The Project Services Group (PSG) will be responsible via the PSG Leader for the
provision of PMT support in respect of Project Engineers, Document Controllers,
PPC Engineers, Cost Control Engineers & Contract Engineers from pooled
resources who are assigned to a Project (or Projects) according to work load,
capability, experience.
5.9 Legal Department
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Legal Department is responsible to ensure that the content of Contract Agreement or

Purchase Order placed by Client is clearly understood and aligned with Policy of
Management, related rules and regulations and prevents any Legal discrepancies
occurring during Project realization.

6. PROCEDURE

6.1 Contract Review Procedure

Upon receiving notification from Client (normally by way of Letter of Notification or

Intent) that RPE is successful with a tender, Business Development Director issues a
‘Notice of Award’ (Attachment 2) and Internal Memo to Operations Director, Project
Manager (designate) Proposal Manager, Managers and Heads of Department whom
shall review the Contract,(or Purchase Order ), (or Letter of Notification/ Intent) prior
to its acceptance so as to detect and resolve differences from the Tender

In the case of major discrepancies between the Tender (or Proposal) and the
Contract (or Purchase order) then these shall be informed to the Customer for
resolution via the Business Development Director whom have the responsibility to
resolve these differences. In the event that the Business Development Director is
unable to resolve the differences then the President Director shall do so with the
assistance of the assigned Project Manager.

Once the award is determined to be acceptable the Business Development Director

shall confirm RPE acceptance of the award to the Client.

Defining a unique sequential, alpha numerical Contract / Project number will be the
responsibility of the Business Development Administrator, who in liaison with the
Finance Department will register the new award in the SAP System.

6.2 Contract Handover (Job Hand-Over Dossier)

6.2.1 Following Contract Acceptance by the President Director, the Contract (or
PO) is returned to the Proposal Manager who shall consolidate all final and approved
data in a dossier called “Job Hand-Over Dossier” which shall be prepared complete
with the following documents and information included:

 Copy of Letter of Notification/ Award of Contract, (or Purchase Order) and all
attachments.
 PQ/ Tender or Proposal (Stage 1 + Stage 2)
 Job Handover Sales Budget and associated estimates.
 Tender correspondence.
 Customer details & contacts.
 Sub-contract enquiries & quotations
 Materials enquiries & quotations
 Contract conditions
 Related Technical References, such as :
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- Drawings
- Specifications
- Standards

6.3 Job Hand-Over Dossier Acceptance

Upon receipt of the Job Handover Dossier the appointed Project Manager (or Project
Engineer) shall check the contents for completeness and acceptance, particularly the
Sales Budget, whereupon the PM (or PE) shall formally accept the Job Handover
Dossier by way of issue of Job Handover Internal Memo duly signed.

6.4 Contract Award

6.4.1 Finalization of Contract/Purchase order

Contract or Purchase Order will normally be received from Client in draft form
whereupon the final terms & conditions are negotiated between Client and RPE
Project & Legal Team until it is acceptable to both Client & RPE. This process
normally takes 1-2 months to complete.

The Contract/PO review shall be performed by the Project Manager with the
assistance of Operations Manager, Proposals Manager, Finance Director and Legal
Manager to determine that the Contract / Purchase Order requirements are
adequately identified and acceptable using “Contract Review Checklist” (Attachment-
1) to ensure that the following information are considered as a minimum :

 Price
 Payment Terms
 Scope
 Document Revisions
 Specifications
 Conditions of Contract
 Contract Schedule/Delivery Date
 Company capacity & capabilities

The Contract Review Check List (Attachment No.1) shall be signed off as approved
by Operations Director and filed as evidence of final review prior to hand-over.
Records of the Contract Review shall be documented and maintained on the Project
file.

6.4.2 Acceptance of Contract/ Purchase Order

Following Contract Review and Acceptance the all related Department shall initial
each page and then issue to president Director for final review and signature.

Once a Contract (or Purchase Order) is accepted signed and acknowledged by the
President Director, one original copy shall be formally issued to Client by the PM (or
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PE) using RPE letter with the RPE original copy of the Contract (or Purchase Order)
issued to Legal Manager for safe keeping by Project Manager using Notice of Award
and Internal Memo (Attachment 2). Only copies are to be in general circulation.

Note: In case of the Contract being initiated via Customer Letter of Notification/Intent
(L of I), the Project shall be executed according to the requirements (if any) of the L
of I. When an L of I is issued then it shall be the responsibility of the Project Manager
to expedite the Contract (or Purchase Order) to ensure early receipt, then for
subsequent processing, signature & circulation.

7. DOCUMENTATION

Contract / Purchase Order from Client shall be kept by Legal Department for
retention period + 5 years after Project is completed.

8. ATTACHMENTS

Attachment-1 Contract Review Checklist

Attachment-2 Notice of Award