Subcontract change orders (SCO) overview

A subcontract change order (SCO) is used to modify the original subcontract when conditions or the scope of work change. Either the prime contracting firm, such as the general contractor, or the subcontractor might initiate these changes and can affect both the subcontract value and the project schedule.

Typically, the prime contracting firm formally approves and executes the SCO after completing the change proposal request (CPR), change order (CO), or both processes. Wizards are available to generate one or more SCOs from CPRs automatically, though SCOs might also be created manually when needed.

  • When you create or modify an SCO, Sage Construction Management checks the vendor’s profile for expired insurance records. If any are found, a warning message appears in red.

  • The order number field is an integer that defines the sequence used to determine previous SCO amounts. When printing the SCO report, the previous SCO amount includes all SCOs marked approved with a status date and an order number lower than the current SCO.

  • SCO status progresses in the following order:

    1. Draft

    2. Pending Submission

    3. Pending

    4. Not Approved

    5. Approved

  • To prevent SCOs from being modified if sub invoices exist, select the Settings () > Feature Settings > Procurement > Do not allow Subcontracts or SCOs to be modified after Sub Invoices have been created option.

  • An SCO affects the original budget only when it’s marked approved with a status date.

  • In Project Analytics, job cost dashboards include only SCOs marked approved with a status date. They're displayed in the Committed Cost section.

  • A subcontract invoice includes SCOs only when the type is Fixed Lump Sum and the SCO is approved with a status date on or before the invoice's issue date.”

Subcontract Type Contract Amount
Fixed Lump Sum Yes *
Cost Plus with GMP Yes *
Cost Plus without GMP
Unit Price

* The SCO will add or deduct from the original budgets set up in the subcontract.

  1. Review the initiated by options in Settings () > Feature Settings > Procurement.
  2. Ensure that the prime contract and subcontract that will be referenced on the SCO are approved with a status date.
  3. Ensure that the job cost code that will be referenced on the SCO proposed items are set up for the project.
  4. Optionally, if tax codes will be referenced on the SCO proposed items, ensure that they're set up in Settings () > Company Settings > Taxation.

Add SCOs

Edit SCOs

  • If an SCO has been imported into a subcontractor invoice and the SCO is marked as approved, its status and status date can no longer be changed.

  • If a subcontractor invoice exists and the Settings () > Feature Settings > Procurement > Do not allow Subcontracts or SCOs to be modified after Sub Invoices have been created option is selected, then SCO items cannot be added or modified, even if they have not yet been invoiced. Invoiced SCO items cannot be modified under any circumstances.

  • If a workflow rule that applies to a SCO has already been initiated or approved, you cannot modify the SCO unless the rule is abandoned.

Other

On this page

Posted December 23, 2025 © 2025 The Sage Group plc or its affiliates ("Sage") or its licensors. All trademarks mentioned are the property of their respective owners. Use of non-Sage trademarks is not an endorsement of any person or product.