[Free Sample WIP Report] Take Control of Your Construction Projects Today!
Construction companies operate in a unique financial landscape. They have ongoing projects and costs that change, which can make it hard to keep track of their money.
Because of this, Work in Progress (WIP) schedule reports have become an important part of accounting for construction projects. They help companies keep accurate records of how much their projects cost and how much money they are making.
If you work in the construction business, you need to know how important WIP reports are and what makes a good WIP report. This article will talk in-depth about these topics, and we'll even give you a free sample report.
Read on to find out how WIP schedules can change the way you handle your money and keep your projects on track.
What is a Work in Progress (WIP) Schedule?
A Work in Progress schedule (WIP report) shows if a project is overbilled or underbilled, which shows who is paying for the project. It also makes it easy for contractors to keep track of what work has been done, how much has been paid for it, and what still needs to be done.
Having an accurate WIP report allows you to:
Ensure everyone on the team understands the billing process
Monitor the progress of a job or project
Identify any cash flow issues or profit concerns.
Why is a WIP Schedule Report Important?
The WIP report is an important financial reporting tool for construction companies. It shows whether a project is over or under-billed, indicating if the company is cash positive or negative. If a project is under-billed, you are financing the project, which is bad for your cash flow. But the goal is to get cash into the project through proper overbilling, which means using the client's money.
This information is crucial for external users such as project stakeholders, bankers, and sureties who need to see financials to obtain bonding and understand how much bonding a company may qualify for.
Internally, project managers rely on WIP schedules for several critical tasks, including: