01
Reconcile
Tie active jobs and job costs to the accounting records.
WIP Schedule Preparation
WIP Schedules Contractors Can Defend
A work-in-progress schedule should explain where profit is being earned, where it is fading and how much revenue belongs in the current period. I prepare and review WIP schedules that connect the job ledger to the financial statements and give owners a usable view of active work.
If the percent complete, cost to complete or overbilling is wrong, the income statement can look profitable while cash and job performance tell a different story.
A WIP schedule is only worth having if it matches your financials. I calculate percentage of completion monthly, compare earned revenue to what you have billed, and carry over and under billings to the balance sheet where they belong rather than leaving them in a spreadsheet. Then I look at the estimated amount to complete the job and make sure it is a real number and not just last month's number copied forward, because that is where most WIP schedules quietly go wrong.
When to Get Help
Warning Signs I Look For
- Job costs do not reconcile to the general ledger
- Estimated cost to complete is a guess
- Overbillings and underbillings are not reviewed monthly
- Profit fade is discovered only after a job is nearly finished
- The WIP schedule does not support bonding, lending or tax conversations
The Work Product
What You Receive
- A reconciled contract schedule by active job
- Contract value, approved change orders and revised contract totals
- Costs incurred, estimated cost to complete and percent complete
- Earned revenue, billings, overbillings and underbillings
- Gross-profit movement and exceptions that require owner attention
- A repeatable monthly WIP close process
A Controlled Process
How the Work Moves Forward
02
Challenge estimates
Review remaining labor, material, subcontractor and closeout costs with the people closest to each job.
03
Calculate
Prepare percent complete, earned revenue and billing position consistently.
04
Use the result
Connect the WIP schedule to cash planning, pricing and management decisions.
Questions Contractors Ask
How often should a contractor prepare a WIP schedule?
Monthly is the most useful cadence for active contractors. Quarterly preparation can satisfy a reporting request, but it is usually too slow for managing profit fade, billing position and cash.
Can you prepare WIP if our job costing is messy?
It depends on what you consider messy. The job ledger and general ledger must first be reconciled to support the schedule.
Is this only for percentage-of-completion financial statements?
No. A WIP schedule is also a management tool for backlog, billing position, risk analysis, and job-level gross profit.