Create a change order

Overview

Create a change order if you need to make modifications to your project and contract. The change order can adjust the contract value and forecasted expenses for the project. To create a change order, add a new estimate on the project to capture the changes. Use a change order project label and category so the updates are reflected accurately in the project.

Things to know

• Change orders apply at the project level.

• Projects can have multiple change orders.

• An original sold estimate is required to create a change order.

Use case

The original contract value on your project is $100,000. During the project, there are changes that were not foreseen which increases the cost of completing the project by $15,000. To account for this increase in cost, you can create a change order in the amount of $16,500 to recover the increase in cost with a 10% margin.

Best practices

• Don't update the original sold estimate for the project. Instead, create a change order.

• Change orders allow you to retain the information in the original sold estimate and to identify and track changes to the original sold estimate.

Create a change order

When project scope changes, you can create change orders to reflect this:

Note: Before you create a change order, make sure you have a change order project label. This allows you to track change orders in the Budget vs Actuals reporting. For more on project labels, see Create project labels.

1. Open the project you want to set up a change order for.

2. Click the Actions dropdown and select Build Estimate.The Build Estimate window opens.

3. Click the Create New Opportunity tab.

4. Click the Business Unit dropdown and select the business unit (BU) for which you want to create an estimate.

5. When you're finished, click + Build Estimate.

   Note: You can also select a template and click Done to create an estimate from an existing template.

   Create Estimate opens.

6. Build the new estimate.

7. If you're adding the change order to an Application for Payment, follow these best practices:

   1. Add a project label to all the items in the change order. For more on project labels, see Create project labels.

   2. When initiating an Application for Payment, your change order is grouped as one scheduled value named after the Name of the estimate.

      1. This is different from the logic of how the other scheduled values are updated based on project labels assigned.

      2. When an invoice is generated for the change order, service items are added using the same logic as the initial estimate.

      3. Actual Billing is reported on the Budget vs Actual table based on project labels assigned using the same logic as service items from the initial estimate.

   3. When the change order estimate status is updated to sold, turn the Change Order toggle on on the Estimate screen.This ensures that the change order is accounted for in the Application for Payment summary. You can find change order details in the Net change by Change Orders and Change Order Summary sections.

Want to learn more?

• Visit the Academy and enroll in Progress Billing with Application for Payment

• See Complete Application for Payment and Continuation Sheet

• See Add an estimate to an opportunity