Glossary

ERP terms, explained simply

Short, practical definitions for the words contractors, panel builders and accounts teams use every day.

Construction

BOQ: A BOQ (bill of quantities) is a document that lists every item of work in a construction project, with a description, unit of measurement and quantity for each. Contractors price it with rates to bid, and once a contract is awarded the priced BOQ becomes the basis for budgets, measurement and RA bills.
Change order: A change order, also called a variation, is a formal, approved change to the scope of a construction contract — added, omitted or altered work — together with its effect on price and, where relevant, time. Once the client approves it, the change becomes part of the contract and the work can be measured and billed in RA bills.
Cost ledger: A project cost ledger is the running record of every cost on a construction project — material, labour, plant, subcontract and overheads — tagged to a cost head and phase. It separates committed cost, such as approved purchase orders, from actual cost incurred, so the project can be compared with its budget while work is still under way.
Defect liability period: The defect liability period (DLP) is a fixed period after a construction project is completed — commonly 12 months, though contracts vary — during which the contractor must repair defects that appear, at its own cost. The balance of retention money or a performance security is usually released only when the period ends and defects are cleared.
DPR: A DPR (daily progress report) is a record prepared on a construction site each day that captures the work done against planned activities, labour and equipment deployed, materials received and used, weather, and issues or delays. It is the primary evidence of site progress for the project manager, the client and later claims.
Liquidated damages: Liquidated damages (LD) are a sum agreed in a contract that the contractor pays the client for each period of delay beyond the completion date, typically a percentage of the contract value per week, subject to a maximum cap. In India they are usually recovered by deduction from the contractor's RA bills or final bill.
Mobilisation advance: A mobilisation advance is an advance payment a client makes to a contractor at the start of a construction contract to help with site set-up, plant and initial material. It is usually a percentage of the contract value, often secured by a bank guarantee, and is recovered in instalments by deduction from later RA bills.
RA bill: An RA bill (running account bill) is an interim bill a contractor raises during a construction project for work completed so far. It records cumulative quantities against the contract BOQ, claims the value of work done since the previous bill, and is paid after the client certifies it and deducts retention, advance recovery and taxes.
Rate analysis: Rate analysis is the method of working out the rate for one unit of a construction item — such as one cubic metre of concrete — by adding up the material, labour and equipment it needs at current prices, then allowing for wastage, sundries, overheads and profit. The result is the rate a contractor quotes against a BOQ item.
Retention money: Retention money is a portion of each running bill that the client withholds from the contractor as security for proper completion and the remedy of defects. It is usually a percentage of the bill value set in the contract, accumulates over the project, and is released in part at completion and the rest after the defect liability period.

Electrical

APFC panel: An APFC panel (automatic power factor control panel) is an electrical panel that keeps a facility's power factor close to a set target by switching capacitor banks in and out in steps. A power factor controller measures the load through a current transformer and operates capacitor-duty contactors or thyristor switches as the load changes.
BOM: A BOM (bill of materials) is a structured list of every component, sub-assembly and material needed to make one product, with the quantity of each. In an engineer-to-order business such as electrical panel building, the BOM is created for each job and, once priced with charges and margin, becomes the basis of the quotation, purchase and production.
MCC panel: An MCC panel (motor control centre) is a low-voltage switchgear assembly that houses the starters, protection and controls for a group of electric motors in one place, fed from a common busbar through an incomer. Each motor has its own feeder, typically with a breaker, contactor and overload relay, or a soft starter or VFD.

Finance & tax

GSTR-1: GSTR-1 is the GST return in which a registered business reports its outward supplies — sales — for a tax period, with B2B invoices listed individually, B2C sales summarised, plus exports, credit and debit notes and an HSN summary. Monthly filers file it by the 11th of the following month; quarterly QRMP filers by the 13th after the quarter.
GSTR-3B: GSTR-3B is the summary GST return through which a registered business declares its total outward supplies and tax liability, claims eligible input tax credit and pays the net GST due for the period. Monthly filers file it by the 20th of the following month; quarterly QRMP filers by the 22nd or 24th, depending on their state.
HSN code: An HSN code (Harmonised System of Nomenclature) is an internationally used numeric code that classifies goods. Under Indian GST, HSN codes identify the applicable tax rate for a product and must be shown on tax invoices and reported in GSTR-1, with the number of digits required depending on the business's annual turnover.
TDS: TDS (tax deducted at source) is tax that the person making a payment deducts from the amount payable and deposits with the government on behalf of the recipient. In India, contractors and suppliers mostly meet income-tax TDS on contract payments and, when billing certain government bodies, separate GST TDS; the recipient later claims credit for both.
Three-way match: A three-way match is a purchase control that compares three documents before a supplier is paid: the purchase order (what was ordered and at what price), the goods receipt note (what was actually received and accepted) and the supplier's invoice (what is being billed). Payment is approved only when quantities and prices agree, within any set tolerance.

Operations

GRN: A GRN (goods receipt note) is the document a business creates when it receives material from a supplier. It records what arrived against the purchase order — item, quantity, condition and date — and is the point at which stock increases and the business accepts the goods, making it one leg of the three-way match before the supplier is paid.
Purchase requisition: A purchase requisition is an internal request from a department, job or site asking the purchase team to buy specific material or services, with quantities and the date needed. It is approved before any purchase order is placed, so that buying is authorised, linked to a real need and checked against stock already held.