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Published December 6, 2023 . 0 min read

WIP Automation 101: From Static Report to Dynamic Tool

WIP Automation 101: From Static Report to Dynamic Tool

In the fast-paced construction world, the Work-in-Progress (WIP) report is an essential financial tool, often hailed as “the only accurate way to know the true profitability” of a company engaged in contract work. It serves as a financial compass, guiding organizations through the complexities of ongoing projects. However, the manual generation of WIP reports poses challenges, from time-intensive processes and limited insights to the inherent risk of errors.

The WIP is critical because it conveys the status of a contractor’s projects to all stakeholders, from internal PMs and execs to the ‘money guys’ such as bankers, the bonding agency, surety underwriters, and other lenders. Cloud-based WIP reports update automatically, providing “always-on” access and allowing contractors to run deeper analyses and create custom snapshots. Therefore, they represent a huge step forward from the legacy approach—namely, waiting on the accounting team to complete its monthly update of a static, backward-looking spreadsheet.

Basics of WIP Reporting

The WIP report is a dynamic and specialized instrument designed to monitor and analyze the financial health of active projects. Specifically tailored for businesses utilizing the percentage-of-completion accounting method, this report takes center stage in reconciling billings and costs on a monthly basis. Its purpose extends beyond a mere financial snapshot; it serves as a compass for navigating complex financial metrics unique to the construction landscape.

Key Components:

Progress Tracking

Monitoring the stage-by-stage progress of construction projects and mandates conducting this report at least monthly as part of the monthly closeout process

Percentage-of-Completion Accounting

Essential for businesses using this accounting method to reconcile billings and costs monthly.

ProNovos provides quick, easy checks on our financials versus having to hunt down the data then perform extensive calculations.

Brett Diamon
President, Gideon Constructors

Financial Metrics Monitoring

Key financial metrics to analyze profitability, cash flow, and project performance. Need-to-have metrics include:

Contract Amount

Projected Final Cost

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ProNovos is essentially giving us a daily WIP report. It tells you everything you need to know about individual jobs.

Casey Dillon
President & CEO, Atlas Excavating