# WIP Schedules: Over- and Under-Billing
The **Work-in-Progress (WIP) schedule** is the most important report in construction accounting. Bankers and sureties read it first.
## What it shows
For each open job: contract value, estimated cost, **costs to date**, **% complete**, **billed to date**, and **earned revenue**. From that it derives:
- **Overbilling** (billings in excess of costs/earnings) — you've billed *more* than you've earned. Common and useful for cash flow, **but** it's essentially borrowed from the job; don't spend it as profit.
- **Underbilling** (costs/earnings in excess of billings) — you've done *more* work than you've billed. It ties up your cash and can signal billing or estimating problems.
## Why sureties and lenders care
The WIP reveals **profit fade**, hidden losses, and whether you're financing your jobs with overbillings. A clean, accurate WIP **raises your bonding capacity** and credibility. A messy one scares the people who fund you.
**Takeaway:** A clean WIP schedule raises your bonding capacity; a messy one scares your lenders.
> *Educational content — not legal, accounting, or licensing advice. Rules vary by state and change; verify with the licensing board and a CPA.*
