Ask Your Surety Pro – When Should You Include a Change Order in Your WIP Report?

Accurately reporting your contract backlog matters to your surety company. And one of the most common mistakes is adding a change order to your contract value too early.

In this episode of Ask The Surety Pro, Tony DeMartino, Surety Producer at Anderson & Catania, explains why you should not include a change order simply because you have submitted it or performed the additional work. Ideally it should be approved and executed. At a minimum, you should have written approval of the additional contract price and a clear basis for recognizing the revenue.

Including unapproved change orders can overstate your backlog, inflate projected profits, and potentially hide profit fade. Your surety underwriter wants a WIP report that accurately reflects your company’s financial position.

⏱ Watch time: 0:57