Work in progress (WIP)
A WIP report shows, across all open jobs, how much has been earned vs. billed — surfacing overbilling and underbilling and your real position.
WIP compares costs incurred and percent complete against amounts billed to date. It tells you whether you've billed ahead of the work (overbilled) or behind it (underbilled), which is critical for cash flow and for not mistaking a billing timing difference for profit.
Related terms
- Overbilling / underbilling — Overbilling is billing more than the work completed to date; underbilling is billing less. Both distort how profitable a job looks until it's reconciled.
- Progress billing — Progress billing is invoicing for a job in installments as work is completed, rather than one lump sum at the end.
- Job costing — Job costing is tracking the actual costs of a specific job — materials, labor, subs, and other expenses — against what you estimated, so you know the real profit on that job.