# What Is a WIP Report (Work-in-Progress Schedule)?

A WIP report, or work-in-progress schedule, lists every open contract with its price, estimated cost, costs to date, percent complete, revenue earned and amount billed. It shows whether each job is overbilled or underbilled and whether its profit is holding. Contractors use it monthly to manage jobs, and banks and surety companies ask for it.

## Key takeaways

- A WIP report compares what you've *earned* on each job (by percent complete) with what you've *billed*.
- Over/(under) billing = billed to date − revenue earned to date.
- Overbillings are a liability (you've collected for work not done). Underbillings are an asset (work done you haven't billed), and they often signal a problem.
- Profit fade, when a job's projected margin shrinks month after month, is the early warning a WIP report is built to catch.
- It only works if job costs are coded correctly and estimates to complete are updated every month.

## What's on a WIP report?

**WIP report columns and how each is calculated**

| Column | What it means | How to calculate |
| --- | --- | --- |
| Contract amount | Current contract value including approved change orders | Original contract ± approved [change orders](https://www.brix.so/learn/change-order) |
| Estimated total cost | What the job will cost when finished | Costs to date + estimated cost to complete |
| Estimated gross profit | Expected profit on the whole job | Contract amount − estimated total cost |
| Costs to date | Job costs posted so far | From your job cost reports |
| Percent complete | How far along the job is | Costs to date ÷ estimated total cost ([percentage of completion](https://www.brix.so/learn/percentage-of-completion)) |
| Earned revenue | Revenue you've earned to date | Percent complete × contract amount |
| Billed to date | Everything invoiced on the job, including [retainage](https://www.brix.so/learn/retainage) | From your invoices or [AIA pay applications](https://www.brix.so/learn/aia-billing) |
| Overbilling | Billed more than earned | Billed to date − earned revenue, if positive |
| Underbilling | Earned more than billed | Earned revenue − billed to date, if positive |
| Cost to complete | Remaining cost | Estimated total cost − costs to date |

**Over/under billing**

```
Over (under) billing = Billed to date − (Costs to date ÷ Estimated total cost × Contract amount)
```

## WIP report example

**Example WIP schedule for a mechanical and electrical contractor, month-end (illustrative)**

| Job | Contract | Est. total cost | Cost to date | % complete | Earned | Billed | Over | Under |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| A. Office HVAC retrofit | $800,000 | $680,000 | $612,000 | 90% | $720,000 | $760,000 | $40,000 |  |
| B. Restaurant plumbing | $240,000 | $192,000 | $48,000 | 25% | $60,000 | $90,000 | $30,000 |  |
| C. School electrical | $500,000 | $425,000 | $255,000 | 60% | $300,000 | $260,000 |  | $40,000 |
| D. Warehouse roof | $180,000 | $150,000 | $30,000 | 20% | $36,000 | $0 |  | $36,000 |
| **Total** | **$1,720,000** | **$1,447,000** | **$945,000** |  | **$1,116,000** | **$1,110,000** | **$70,000** | **$76,000** |

_Example numbers. Percent complete uses the cost-to-cost method._

> **How to read this example**
>
> **Job A** is overbilled $40,000, which is normal near the end of a job that front-loaded its schedule of values. But its estimated cost rose from a $640,000 bid to $680,000, so projected gross profit faded from $160,000 (20%) to $120,000 (15%). That fade deserves a conversation with the project manager.
>
> **Job B** is overbilled $30,000 at 25% complete. That's cash in hand, and healthy, as long as the remaining $144,000 of cost is really enough to finish.
>
> **Job C** is underbilled $40,000. The crew has done $300,000 of work but only $260,000 has been billed. Either the billing is behind (fix it this month) or costs are running over budget and the work isn't as far along as the cost says.
>
> **Job D** is underbilled $36,000 because nothing has been billed yet. Materials are on site and the first pay application hasn't gone out. Bill it.
>
> Across the company, underbillings exceed overbillings by $6,000. The company is financing $6,000 of its customers' work, and Job C is the place to look first.

## Are overbillings good or bad?

Moderate overbillings are usually good for cash flow: customers are funding the job ahead of your costs. But overbillings are a liability on the balance sheet (often called "billings in excess of costs and estimated earnings"), because you owe the customer work for money already collected. Trouble starts when that cash gets spent on other jobs or overhead, and then the job needs money to finish that's already gone. Large overbillings can also mean you underestimated costs, so percent complete is too low.

## Why are underbillings a red flag?

Underbillings ("costs and estimated earnings in excess of billings") are an asset on paper, but they mean you've spent money on work you haven't billed. Sometimes it's just a late pay application. Often it means the job is over budget: costs are high, so cost-to-cost percent complete says the job is further along than it really is, and the "earned" revenue will never be billed. Lenders and sureties look closely at underbillings for exactly this reason.

## How do you build a WIP report?

1. **Close the month's job costs.** Enter every supplier bill, sub invoice and payroll for the month, each coded to a job. See [how to do job costing in QuickBooks](https://www.brix.so/learn/how-to-do-job-costing-in-quickbooks).
2. **Update contract amounts.** Add approved change orders. Decide and document how you treat unapproved ones; most contractors leave them out until signed.
3. **Get estimates to complete from the field.** Ask each project manager or foreman what it will really cost to finish. This is the most important number on the report.
4. **Calculate percent complete and earned revenue.** Costs to date ÷ estimated total cost, times contract amount.
5. **Compare to billings.** Pull billed to date from invoices or pay applications, then calculate over and under billings.
6. **Review fade and act.** Compare each job's projected gross profit to last month and to the bid. Investigate any job that faded more than a point or two.

## Who uses a WIP report?

| User | What they look for |
| --- | --- |
| Owner and project managers | Which jobs are fading, which are underbilled, what to bill this month |
| Surety (bonding) company | Whether profits are reliable and the company can finish its backlog; consistent underbillings and fade raise concerns. See [surety bonds](https://www.brix.so/learn/surety-bond). |
| Bank | Whether reported profit is real and working capital is adequate |
| CPA | Adjusting entries to put revenue on a [percentage of completion](https://www.brix.so/learn/percentage-of-completion) basis for financial statements |

## WIP reports by trade

**Who needs a WIP report**

| Trade | Need a WIP report? | Why |
| --- | --- | --- |
| General contractors and builders | Yes | Multi-month jobs, draws, bonding |
| Commercial electrical, mechanical and plumbing subs | Yes | Monthly progress billing, retainage, bonding |
| Commercial roofing | Usually | Large jobs that span months or seasons |
| Residential remodelers | Helpful | Jobs of several weeks with staged payments |
| Residential service (HVAC, plumbing, electrical repair) | Rarely | Jobs finish in a day; a job costing report is enough |
| Landscaping and cleaning routes | No | Recurring service billed as performed |

## Common WIP report mistakes

- **Using the original bid as the estimated cost.** If estimates aren't updated, the report hides fade until the job closes.
- **Costs posted to the wrong job (or no job).** Percent complete is wrong for both jobs involved.
- **Leaving retainage out of billed to date.** Billed to date should include retainage you've billed, even though it's not collected yet.
- **Counting stored materials as progress.** A delivery of equipment that isn't installed can make a job look further along than it is.
- **Doing it only at year-end.** A WIP report is a monthly management tool. Once a year it's just an accounting exercise.

A WIP report is only as good as the job costs underneath it. BRIX keeps expenses categorized and syncs invoices and payments with QuickBooks, so the billing and cost columns are current when you sit down to build the schedule.

- [Bookkeeping and tax help](https://www.brix.so/features/bookkeeping-taxes): Keeps expenses categorized, tracks 1099 subcontractors and sales tax, and reminds you of quarterly estimated tax dates. BRIX does not file taxes or give tax advice.
- [QuickBooks sync](https://www.brix.so/integrations/quickbooks): Syncs customers, invoices and payments with QuickBooks so the books match the jobs.

## Frequently asked questions

### How do you calculate overbilling and underbilling?

Calculate earned revenue as percent complete times contract amount, then subtract it from billed to date. A positive result is an overbilling; a negative result is an underbilling. Percent complete is usually costs to date divided by estimated total cost.

### Is overbilling a liability?

Yes. On the balance sheet, overbillings are a current liability, often called billings in excess of costs and estimated earnings, because you've billed for work you still owe. Underbillings are a current asset.

### How often should a contractor run a WIP report?

Monthly, after job costs for the month are entered. Many owners review it in the same meeting as the monthly P&L. Sureties and banks may ask for it quarterly or annually.

### What is profit fade on a WIP report?

Profit fade is when a job's projected gross profit drops over time, usually because costs ran over or estimates to complete were too optimistic. Comparing each job's projected margin month to month shows fade early, while you can still fix it.

### Can QuickBooks create a WIP report?

QuickBooks Online doesn't produce a full construction WIP schedule on its own, but its project and job cost reports supply costs to date and billings. Many contractors export those to a spreadsheet and add estimates to complete.

### Do small contractors need a WIP report?

If your jobs run longer than a month, you bill progress payments or you want bonding, yes. If almost every job is a same-day service call, a monthly job costing report is usually enough.

## Related

- [What Is the Percentage of Completion Method?](https://www.brix.so/learn/percentage-of-completion)
- [What Is Progress Billing?](https://www.brix.so/learn/progress-billing)
- [What Is Retainage in Construction?](https://www.brix.so/learn/retainage)
- [AIA Billing Explained: How to Fill Out a G702 and G703](https://www.brix.so/learn/aia-billing)
- [What Is Job Costing?](https://www.brix.so/learn/job-costing)
- [How to Do Job Costing in QuickBooks Online](https://www.brix.so/learn/how-to-do-job-costing-in-quickbooks)
- [Job Costing Spreadsheet Template](https://www.brix.so/templates/job-costing-spreadsheet)
- [What Is a Surety Bond?](https://www.brix.so/learn/surety-bond)
- [Bookkeeping for contractors that keeps your books tax-ready all year](https://www.brix.so/features/bookkeeping-taxes)
- [Contractor invoicing software that sends the invoice and chases the money](https://www.brix.so/features/invoicing-payments)

---
Written by BRIX Editorial Team. Last updated 2026-10-12.
Canonical: https://www.brix.so/learn/wip-report