Over and under billing on every job, every month
Over and under billing is calculated for every job from cost to date and contract value. It updates as cost comes in. You see which jobs are ahead or behind on billing before the month closes.
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How it's calculated
Over and under billing compares what you've billed to what you've earned. Earned revenue comes from percent complete, which is cost to date divided by the estimated total cost, applied to the contract value. If billings are higher than earned revenue the job is overbilled, and if they're lower it's underbilled.
CFOS reads cost to date from QuickBooks Online every hour and billings from your invoices. The estimated total cost uses the approved cost to complete from the last month end. Contract value includes approved change orders, so the math reflects the contract you actually have.
It's your cash position in disguise
An overbilled job means the GC has paid you for work you haven't done yet. That's cash you're holding, and it's also a liability the surety will look at. An underbilled job means you've done work and haven't been paid for it, which is cash you need and don't have.
Both can look fine on a profit and loss. A company can show a profit and be short on cash because three jobs are underbilled. You can also look healthy on cash while you're spending money that belongs to jobs you haven't finished.
What the surety looks at
A surety reads the WIP for two things. One is whether you're front-loading billings and leaving yourself nothing to finish with. The other is whether you're so underbilled that you're financing the owner.
When your schedule shows the same total as the balance sheet, those conversations are short. You can say why a job is overbilled and what the cost to complete is. The numbers come from the books, so you can back them up.
Reading it by job and by month
Start with the total, then sort by the largest overbilling and underbilling. Open each of those jobs and look at the cost to complete the PM entered and the billing schedule behind it. A big change from last month usually means either a change order that wasn't billed or a cost to complete that moved.
Month over month, the trend is what you watch. A job that gets more overbilled every month is being billed faster than the work is done. A job that stays underbilled usually has a pay app that hasn't gone out, and the pay app reminders to the PM are there for that reason.
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We email you when CFOS for QuickBooks opens, plus a few updates before then. Your address stays with Run On CFOS. One click unsubscribes.
30 days free, a 90-day money-back guarantee, and cancel anytime. It opens January 2027. We email you the day it opens.
What people ask
What inputs does the calculation use?
It uses cost to date from QuickBooks Online, the approved cost to complete from the last month end, the contract value with approved change orders, and billings to date. Those four numbers produce percent complete and earned revenue. Overbilling or underbilling is billings less earned revenue.
How current is the number?
Cost updates every hour, so the figure changes during the month. The cost to complete is entered and approved at month end. The formal schedule locks then.
Why would a surety care about overbilling?
Overbilling means you've collected for work that isn't done, and the cost to finish comes out of that cash. A surety wants to see that the money is still there to complete the jobs. A tied out schedule answers that question quickly.
- A WIP schedule that builds itself from job cost
- Job costing software that runs on QuickBooks
- G702 and G703 pay apps from your schedule of values
- Month-end in days, not weeks
- One price. Every module. Priced by your revenue.
- Use all of it, or just the part you need
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