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Create a Change Event with Revenue ROM

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Objective

To create a change event for a project that is using Revenue ROM. 

Background

To prepare for the cost of a change, before it becomes an actual cost, you can create a change event. 

For example, if a project manager is anticipating the need to change the paint colors of a project, he or she can start preparing for that cost by creating a change event, which describes the estimated financial cost of the change as well as which cost codes will be affected. After creating a change event, they can then create an RFQ (Request for Quote), which is sent to the appropriate subcontractors for pricing. When RFQs are created and responded to by the assigned subcontractors, change orders can then be created based upon the submitted quote.

Things to Consider

 Required User Permissions
  • 'Standard' or higher on the project's Change Events tool. 
Supported Platforms
  • Procore for Web
  • Procore for Android
  • Procore for iOS

Steps

  1. Navigate to the project's Change Events tool.
  2. Click Create Change Event.
  3. Under General Information, enter the following:
    • Origin. Select the observation or RFI that resulted in this change event. 
    • Change Event #. The system assigns change event numbers in sequential order. If you want to customize the numbering scheme, you can update it to an alphanumeric number (e.g., A200 or CE1000) and the system will automatically use that scheme and assign subsequent numbers in sequential order. 
    • Title. Enter a descriptive title for the change event.
    • Status. Select the status of the change event from this list:
      Note: To configure these statuses, see "Set Default Change Order Configurations" in the See Also section below.
      • Draft
        Select Draft to if you want to create change event but still have work to complete before setting it to open. 
      • Open
        This is the default status. Select Open to indicate the change event is active while users are managing items associated with the event (e.g., budget modifications, commitment PCOs, Prime PCOs), and RFQs). 
      • Closed
        Select Closed after all required change orders and RFQs have been created and the change event is considered complete.
      • Pending
        Select Pending if the change event requires approval before it can be closed out.
      • Void
        Select Void to indicate no change resulted from the event.
        Notes:
        • It is recommended that you choose this status instead of deleting the change event. This ensures the system keeps a record in the Change Events log page for future reference.
        • To view voided events, select Void or All (Include Void) from the Add Filters menu on the Change Events log page.
    • Scope. Select one of the available options from the list:
      • In Scope. Select this option is the cost of the change event is covered in the original contract. The Revenue ROM will default to No Revenue Expected for all line items.
      • Out of Scope. Select this option if the cost of the change event is NOT covered in the contract. In most situations, a change order will be submitted to the owner/client as an additional cost. The Revenue ROM will default to Automatically Use Latest Cost for all line items. 
      • TBD. Select this option if the cost of the change event has yet to be determined. 
        Notes:
        • The scope setting affects the default Revenue ROM for new line items added to this Change Event. Revenue ROM for each line item can be viewed and edited on the save/view mode of the change event, or on the Detail tab of the Change Event tool. 
        • If the scope is updated after the Change Event is created, a checkbox will appear, giving you the option to “Update the Revenue ROMs” for all existing line items to match the defaults for that scope. This box is checked by default, uncheck it if you wish to preserve your existing Revenue ROM values.
        • If the change event has a mix of different scopes, select the scope that applies to the majority of line items. For example, if the Change Event has 10 line items, and 8 line items are Out of Scope and 2 line items are In Scope, set the Change Event scope as Out Of Scope so all 10 line items default to Automatically use Latest Cost, then save and inline edit the Revenue ROM on the 2 in scope line items to No revenue expected; see Step 5, below.
    • Update Revenue ROMs. This field appears next to the Scope field if you make a change in the Scope field. Mark this check box if you want the revenue ROM of all line items to be updated according to the new scope that you selected. This change will happen when you click the Save button on this change event.
      When changing the scope to In-Scope or TBD, the revenue ROM for all line items will be set to $0. When changing the scope to Out of Scope, the revenue ROM for all line items will be set to automatically use the Latest Cost.
    • Type. Select TBD, Allowance, Contingency, Owner Change, or Transfer to indicate the type of cost you are preparing for.  To learn how to configure change types, see "Set Default Change Order Configurations" in the See Also section below.
    • Change Reason. Select a change reason from the drop-down menu. To learn how to configure change reasons, see "Set Default Change Order Configurations" in the See Also section below.
    • Description. Describe the event that may result in a change in costs. 
    • Attachments. Attach any relevant files. 
    • Prime Contract (For Markup Estimates). Select a prime contract to indicate which prime contract’s markup settings should be used to calculate the markup on revenue ROMs. This field will default to the lowest-numbered prime contract.
    • (Optional) Click +Add Lines for All Commitments if you want to add lines for each scope of work across all subcontracts and purchase orders that are not void or terminated.  
  4. Click Create. 
    Notes:
    • If the combination of the sub job, cost code, and cost type are non-budgeted, a pop-up will appear asking to confirm to add these line items to the budget.
    • If OK is selected, these line items will be added directly to the Budget with a "?" next to each line item. See "Add a Partial Budget Line Item" in the See Also section below.
  5. To edit the Revenue ROM amount, in save/view mode of the Change Event, or on the Change Event tool’s Detail tab, inline-edit each Revenue ROM as necessary:
    • Automatically Use Latest Cost. If this is selected, the Revenue ROM amount will match the Latest Cost amount. (Latest Cost is the existing column in the Change Event Cost section, which auto-updates to the right-most value between Cost ROM, RFQ, Commitment, or Non-Commitment.) Markup that is set up as part of the Prime Contract will calculate on this amount.
    • No Revenue Expected.  If this is selected, the Revenue ROM amount will update to $0. This option is intended for In Scope Change Events that will not utilize a Prime change order.
    • Manual Entry. If this is selected, you can enter any amount. Markup that is set up as part of the Prime Contract will calculate on this amount.
  6. Once the General Information has been filled out, you can start creating change event line items by selecting which cost codes are impacted by doing the following:
    1. Click Add New Line.
      Note: Steps #2-8 below do not need to be completed in the following order. For example, if you select a vendor for a change event line item first, the line will automatically display all matching contracts, cost codes, and categories.
    2. If applicable, select a subjob from the drop-down menu.
    3. Select the impacted cost code from the drop-down menu. You will see budgeted cost codes and non-budgeted cost codes in this list. Note: You will only be able to select a category that is already scoped on the budget.
    4. Select a Line Item Type.
    5. Enter a description.
    6. Select a vendor from the drop-down menu.
    7. Select the contract from the drop-down menu.
    8. Enter a Cost ROM. A ROM is the numeric estimation of what the cost could be and has no financial impact on any of the other tools in Procore.
      • Depending on the Scope selection of the Change Event, the ROM amount entered may also dictate the Revenue ROM amount. The Revenue ROM amount can be manually updated as well.
      • You can add the ROM to the Budget by following the steps in "Add Change Event Columns to Budget View (Including Revenue ROM)" in the See Also section below.

See Also 

If you would like to learn more about Procore’s change events management software and how it can help your business, please visit our construction change order product page here.