Close a Change Order

The General Contractor (GC) holds the authority to approve and close a change order. However, the Project Manager must secure consent from the owner or developer before the final approval and closure.

After finalizing the cost estimates from the participating contractors as detailed on the previous page Process Change Order Bids, you can incorporate additional costs—such as management fees—to determine the final cost of the change work. Once the final cost is established, the GC has the following options:

• Forward the change order to the owner for their formal approval.
• Obtain consent from the owner through alternative communication methods, if necessary, and approve the change order on their behalf.

Note: If the change order closing process requires any contribution from a stakeholder or vendor not included in the Linarc's project directory, you can email the PDF version of the CO to that external party to get their inputs. Once the response is received, you can incorporate it into the CO and proceed with your action. See to Email a Change Order to External Stakeholders learn more.

Add additional fees

You can add any fees and additional expenses to the cost of the change order to arrive at the final cost. This is optional. Each cost item you include should be indicated with the respective cost code for cost tracking. 

• Open the change order, if you haven't done so. To open:
  • Open the management console of the project
  • Click the app launcherand select 'Finance.'
  • Click 'Change Order' on the top, then choose 'Boards' on the left
  • Click the change order from the 'Bids Closed' column
• Click the 'CO Cost' tab.

Reminder:
You can include the additional costs once the work cost estimates from the participating contractors have been finalized. Therefore, the 'CO Cost' tab becomes accessible only after all contractor estimates have been processed and a decision to accept or reject each has been made.

The list shows the accepted bids with their schedule and cost impacts.

Cost Code- The cost code of the change order work. This is to ensure that the change order cost is added to the project budget with the appropriate cost code. Usually, the cost code is the division code/category code of the work as per the task code list at your company level. 

• Click inside the field and select the cost code from the list.
• The Task Name gets auto-populated from the code code.

Additional Fee - Add any further expenses, like commission, management fee, etc.

• Click '+Add Fee' at the bottom
• A new row gets added at the bottom to add your fees: 

Enter the details of the fee:

• Cost Code- The cost/task code for the additional fee. The fee will be added to the project budget under the specified cost code.
  • Click inside the 'Cost Code' cell and select the code from the list
  • The description of the cost gets added to the 'Task Name' field
• Cost Change- The monetary value of the fee
  • Click inside the 'Cost Change' cell and enter the amount in dollars.

• Click the 'Save' button in the 'Action' column.
• Repeat the process to add fees under different accounting heads.

The additional fee is added to the total cost of the change order.

Next step - Approve the change order:

There are two ways to approve and close the change order.

Approve on behalf of the Owner - Once the final cost is determined, obtain the owner's consent using any out-of-band communication method. You can then approve or reject the change order on the owner's behalf directly from the same screen. See Approve a change order on behalf of the owner for more details. 

Send to the Owner for approval - You can forward the change order to the owner for them to review and approve the change order. See Get Owner Approval for more details. 

Signatures:
If Docusign is enabled for your account, you can circulate the approved change orders to the stakeholders to digitally sign it as a mark of their acceptance and approval. You can view the signature status on the same screen under the 'Signature' tab. See Request Signatures for more details.

Tip:
You can initiate or take part in a conversation to chat with the team members and the participants of the change order at any stage. Click the button on the top right. See Chat and collaborate on a CO for more guidance.