. BACKGROUND OF THE STUDY
Construction industry is very important in the economic development of any nation especially in expanding economy like Nigeria [Ibironke, 2012]. It controls the capital flow, as well as labour resources, which had cost implications. As a result of this, proper management of these resources is considered an important aspect of project works. Likewise if the resources are adequately harnessed, issues that relate to cost overrun would not arise which could result to variations and claims. Some firms rely on claims as a result of variation incurred during the course of the project execution and afterward evaluate their profit after incurring necessary and unnecessary tendering on a project. This however has tendency of positioning such in a disadvantageous profit position. An effective cost management strategy is therefore necessary; this could be achieved through putting in place a proactive cost management strategy [Love et. al, 2010]. They described cost management system as a process that should be carried out throughout the lifecycle of a project, from the inception to the final completion and final payment to the contractor. In the light of this, the timeliness and cost effectiveness of various operation and decision carried out will determine to an extent the magnitude of cost that could be saved on the project [Kerzner, 2010, Ogunsemi et al, 2013]. The total cost of construction in normal circumstances is expected to be the sum of the following cost: Materials, Labours, Site overheads, Equipment/ Plant, Head office cost and profit but in many parts of the world particularly in Nigeria, there are other tendering to be allowed for such as cost as a result of currency exchange, contractor’s cartel, disputes on site, insurance cost, fraudulent and kickback [Neil, 2009]. These tendering according to the author in reference [Mbachu et al, 2013] have obvious negative implications for the key stakeholders in particular, and the industry in general. To the client, high cost implies added tendering over and those initially agreed upon at the onset, resulting in less returns on investment. To the end user, the added tendering are passed on as high rental/ lease tendering or prices