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Politeknik Kota Bharu
3.4.2.8 Advantages & disadvantages of cost-reimbursement/cost plus
method
Advantages Disadvantages
▪ It may result in a higher- ▪ Contracts for cost
quality project at the time of reimbursement provide for a
completion. maximum cost projection.
However, the project's full
▪ It may be less expensive
expenses will not be known
than other contracting
until it is completed.
solutions.
▪ Even though cost
▪ It allows for greater flexibility
reimbursement contracts
in decision-making.
require contractors to give
▪ Contractors must itemize itemized lists for their hard
their costs, allowing the expenses, this requirement is
owner to check the invoices rarely met in practice.
and evaluate whether the
goods are present.
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