Managing Escalation Causes on Contracts

Escalation clauses in contracts should be recorded on the draw request.

To do this, follow these steps:
  1. In Change Request Entry, zero out a billing item in the current draw request by entering a line with a negative quantity equal to that of the existing item.
  2. Add a new (positive) billing item equal to the remaining quantity-to-complete at the new price.
  3. The new billing item displays after the zeroed line item and includes the unit cost and quantity-to-date.
  4. The net amount of the change request is equal to the quantity-to-complete times the escalation unit price.
    Note: This procedure usually applies to unit price contracts.