Construction · cost-to-cost percentage of completion

Over-time recognition criterion (b) or (c) · cost-to-cost measure of progress

Status

SPEC ONLY

Why this pattern exists

Construction creates an asset. Whether customer controls it during construction (criterion b) vs at completion (criterion c) determines if over-time recognition applies. Most modern construction contracts qualify.

03 / 07When this applies

Trigger conditions

1Construction-on-customer-land

2Custom asset with no alternative use

3Right to payment for work performed

04 / 07Authority

Authoritative paragraphs

Every codification reference below is verified against the FASB Codification structure or Big-4 public guidance. No fabricated cites.

ASC ASC 606-10-25-27(b)(c)

Over-time criteria for construction

ASC ASC 606-10-55-21

Cost-to-cost · uninstalled materials

ASC ASC 605-35

Carryforward loss-contract guidance

05 / 07What the platform does

End-to-end behavior

1Cost-to-cost engine with uninstalled-materials adjustment (zero margin until installed)
2EAC (estimate-at-completion) re-estimation each period
3Loss contract provisioning under ASC 605-35
4Claims and unapproved change orders as variable consideration with constraint

06 / 07Watchouts

What auditors flag

Common mistakes preparers make on this pattern. The platform's confidence routing surfaces these for reviewer ratification before sign-off.

Including uninstalled materials at full margin

Failing the over-time test (defaulting to completion)

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