Change order

A change order is a written amendment to a construction or service contract that changes the scope of work, the contract price, the schedule, or all three, signed by the parties with authority to bind them. Most contracts require that changes be authorized in writing before the work is performed and set a procedure and deadlines for pricing them.

Change orders are a frequent source of cash strain because the work often happens before the paper does. Extra work performed on a verbal instruction or an unsigned change order generally cannot be billed as contract work and is financed by the contractor until it is executed, if it ever is. On federal contracts the equivalent document is a contract modification issued by the contracting officer.