How to prepare a construction WIP report (free WIP report template)

Download the WIP report template

Download the WIP report template (Excel, .xlsx). No sign-up and no email. It opens in Excel and in Google Sheets: in Google Drive choose New, then File upload, then open the file with Google Sheets.

One file per period, every open job in it, with these tabs:

• WIP — one row per job: contract and approved change orders, original and current estimated cost, cost to date, uninstalled materials, and billed to date. It works out cost to complete, percent complete, earned revenue, overbilled, underbilled, estimated gross profit, any loss provision, gross profit to date and backlog, and flags each job that needs a look.
• Last Period — last month’s or last quarter’s figures for each job, pasted from the previous copy of the file.
• Gain-Fade — each job’s estimated profit now against last period, labelled gain, fade or steady, with what was earned, spent and made this period, and a column for the reason.
• Summary — the portfolio totals, the overbilling and underbilling your balance sheet should carry, the jobs to look at, and a check against the figures in your books.
• Setup, Checklist and Start Here — the dates and alert levels, the month-end steps, and how to use the file.

Blue text is what you type. Black text is a formula. Yellow cells are settings. The file comes with eight sample jobs, with figures to the end of September 2026, including a loss job, a fading job with late-stage underbilling, and a job with switchgear delivered but not installed, so every flag shows.

What a WIP report shows

A WIP report answers one question for every open job: have you billed more or less than the work you have actually done? To answer it, each job needs these columns:

• Revised contract: the original contract plus approved change orders.
• Estimated total cost: the project manager’s current estimate of what the job will cost at completion, including the cost of approved change orders.
• Cost to date, and cost to complete: what has been spent, and what is left.
• Percent complete and earned revenue: how far through the job you are, and the revenue that represents.
• Billed to date: every invoice and pay application, including retainage billed but not yet paid.
• Overbilled or underbilled: the gap between billed and earned.
• Estimated gross profit and gross profit to date: what the job should make in the end, and what it has made so far.
• Backlog: revenue still to earn.

The column that does the most work is the one that is easiest to get wrong: estimated total cost. It has to be today’s estimate at completion, not the original budget. A WIP built on the original budget shows profit the job no longer has.

Percent complete and earned revenue: the cost-to-cost method

Most contractors measure percent complete by cost: cost to date divided by estimated total cost. PwC’s revenue guide describes one common way to measure progress as costs incurred relative to total estimated costs, and notes it is often referred to as the cost-to-cost method. PwC Viewpoint

The tax rule for long-term contracts works the same way. Under the percentage-of-completion method, completion is determined by comparing allocable contract costs incurred with estimated total allocable contract costs, and total costs are estimated on all the facts known as of the last day of the tax year. That is why the estimate at completion has to be current. Cornell LII

Then earned revenue is percent complete times the revised contract. In the template’s sample, the Oak Street retail shell has spent $784,420 of an estimated $862,000, so it is 91% complete. 91% of its $940,000 contract is $855,400 of earned revenue. It has billed $815,000, so it is underbilled by $40,400.

Take out cost that is not progress

Cost-to-cost assumes every dollar spent moves the job forward. Two kinds of cost do not. Wasted materials, labor and other resources that reflect inefficiency rather than progress are left out of the measure. Uninstalled materials, bought and delivered but not yet built into the work, can be earned at their cost with no margin until they go in, if the conditions in the standard are met. PwC Viewpoint

The template has a column for uninstalled materials and takes them out of both sides of percent complete. In the sample, Lakeview Apartments has $180,000 of switchgear on site in its $1,120,000 cost to date. Left in, it would book about $16,400 of profit on equipment nobody has installed yet.

Overbilling and underbilling: what each one tells you

Underbilling is costs and earned profit in excess of billings: work done that you have not billed yet. Overbilling is the reverse, billings in excess of costs and earned profits. Underbilling often comes from timing, unapproved change orders or disputed work. NASBP

Sureties look hardest at underbilling, because it is an asset that may never turn into cash. In an article for NASBP, an underwriter at Old Republic Surety writes that late-stage underbillings can make a surety underwriter doubtful, and that the surety would disallow an underbilling on a nearly finished job unless there was a sound understanding for it and the job was still profitable. In one of their analyses, underbillings inflated a contractor’s working capital by nearly $3 million. NASBP

Overbilling is the safer side, but only if the money is still there. A Marcum partner writing in Construction Business Owner makes the point that any overbilling should be represented by cash. The cost to finish that work still has to be paid. Construction Business Owner

The template flags underbilling on any job past 90% complete (you can change the level on Setup), and the Summary shows both totals, the figures your balance sheet should carry as an asset and a liability.

Loss jobs: book the whole loss now

Cost-to-cost spreads profit across the life of a job. A loss is different. Construction contracts are among the contract types for which the accounting standards require an anticipated loss to be recorded, and PwC’s guide says the loss is recorded in the period it becomes evident. PwC Viewpoint

In the template’s sample, Harbor Medical now expects to cost $1,302,000 on a $1,240,000 contract, a $62,000 loss, and it is 50% complete. Cost-to-cost on its own would show only half the loss, $31,000. The Loss Provision column adds the other $31,000, so gross profit to date shows the whole $62,000 now rather than the second half arriving as a surprise at the end.

Gain and fade: compare every job with last period

A single WIP is a snapshot. The comparison with last period is where the warnings are. When a job’s estimated gross profit comes in higher than before, that is a gain; lower, a fade. The same Construction Business Owner article says sureties and other readers of contractor financial statements will do a gain and fade analysis, and that it should be done monthly, at a minimum. Construction Business Owner

Fades and underbillings tend to travel together. The NASBP article defines a profit fade as actual costs exceeding initial estimates and eroding profitability, and warns that underbillings can signal deeper problems when they contribute to fades. NASBP

The template’s Gain-Fade tab shows the pattern. Oak Street’s estimated margin has fallen from 11.9% to 8.3% since June, and it is also the late-stage job carrying $40,400 of underbilling: the steel package came in over the buyout with no change order. Harbor Medical has gone from a 12.5% margin to a 5% loss. Write a one-line reason against every fade and every gain; it is the first question your surety or banker will ask.

Month-end steps that make the WIP right

A WIP is only as good as the cutoff behind it. These are the checks on the template’s Checklist tab.

1. Is every cost for the period in, and nothing from the next one?

   What a good answer sounds like: Bills, sub pay applications and payroll for the period are all in cost to date, at burdened labor rates.

2. Has each project manager updated the estimate at completion?

   What a good answer sounds like: A signed-off current estimate for every open job. The original budget is not an estimate at completion.

3. Are change orders handled the same way on both sides?

   What a good answer sounds like: Approved change orders in both the contract and the estimated cost. Unapproved ones left out unless your CPA says otherwise, and listed separately.

4. Are uninstalled materials separated?

   What a good answer sounds like: Materials delivered but not installed sit in their own column, earning their cost and no profit.

5. Is every invoice for the period in billed to date?

   What a good answer sounds like: Including retainage billed but not yet paid.

6. Does every loss job show its whole loss?

   What a good answer sounds like: Gross profit to date equals the estimated loss, not a share of it.

7. Does every fade, gain and late-stage underbilling have a reason?

   What a good answer sounds like: One line each, with a date for when the underbilling will be billed.

8. Do the totals agree with your books?

   What a good answer sounds like: Total overbilling and underbilling match the balance sheet, and overbilling is covered by cash.

When a WIP spreadsheet stops being enough

The template works for a handful of jobs with someone careful at month end. These are the signs it has been outgrown:

• The WIP takes days to build because every figure is retyped from somewhere else.
• Cost to date on the WIP never quite matches the job cost report.
• Estimates at completion are guesses made the night before the WIP is due.
• Fades show up at the end of the job instead of in the month they started.

At that point the WIP belongs in the same system as the budget, the costs and the billing, so it calculates from them instead of being rebuilt every month.

Where WorkHoist helps

WorkHoist’s WIP schedule calculates for every active job at once from the records the job already keeps: the budget built from the estimate, costs, approved change orders, approved purchase orders, time cards and invoices. Percent complete is cost to date against the forecast at completion, which is the higher of actual plus committed cost and the revised budget, so an overrun lowers percent complete instead of hiding. Approved change orders move both the contract and the budget.

A job expected to lose money shows its whole expected loss at once, in its own Loss Provision column, and the WIP’s percent complete is the same figure the project overview and the P&L use for earned revenue. Once pay rates are set, crew time cards become labor cost on the job, at each worker’s rate plus burden, or you keep booking payroll as expenses; one or the other, never both. The schedule exports to CSV and is on every plan.

WorkHoist saves the WIP at each month end on its own, and on any other date with Save WIP now, and a saved period is never changed. Change since last period shows each job’s estimated gross profit and margin then and now, flagged Fade or Gain at the threshold you set (2 points by default), with the revenue, cost and gross profit earned in between, and every saved period exports to CSV.

Questions contractors ask

What is a WIP report in construction?

A WIP (work-in-progress) report is a schedule of every open job showing its contract value, current estimated total cost, cost to date, percent complete, earned revenue and billed to date, and whether each job is overbilled or underbilled. Sureties, banks and CPAs use it to judge whether the jobs, and the company, are as profitable as the books say.

How do you calculate percent complete on a WIP report?

Most contractors use the cost-to-cost method: percent complete is cost to date divided by the current estimate of total cost at completion. Leave out cost that is not progress, such as uninstalled materials and wasted materials. Earned revenue is percent complete times the revised contract value, which is the original contract plus approved change orders.

What is overbilling and underbilling?

Overbilling is billings in excess of costs and estimated earnings: you have billed more than the work you have done, and the balance sheet carries it as a liability. Underbilling is costs and estimated earnings in excess of billings: work done that you have not billed yet, carried as an asset. Sureties look hardest at underbilling, especially on jobs that are nearly finished.

Is underbilling bad?

Not always: it can be timing, or a change order still being approved. But underbilling is work you have paid for and not billed, and a surety may disallow it from working capital, especially late in a job, unless there is a sound reason and the job is still profitable. Every underbilling should have a reason and a date when it will be billed.

What is profit fade on a WIP report?

Profit fade is a fall in a job’s estimated gross profit from one WIP to the next, usually because costs are running over the estimate. The opposite is a gain. Sureties and other readers of contractor financial statements compare each job’s estimate period to period, and the analysis should be done at least monthly.

How do you show a loss job on a WIP report?

Book the whole expected loss in the period it becomes evident, not a share of it as the work goes on. On the WIP, add a loss provision equal to the part of the expected loss that percent complete has not yet recognized, so gross profit to date equals the full estimated loss.

Is there a free WIP report template?

Yes. WorkHoist’s WIP report template is a free Excel file, with no sign-up or email, that also opens in Google Sheets. It works out cost-to-cost percent complete, earned revenue, overbilling and underbilling for every open job, handles loss jobs and uninstalled materials, compares each job’s estimated profit with last period, and checks the totals against your balance sheet.