CCIFP Study Guide 2026

The over/under billing schedule (WIP schedule) compares billed amounts to earned revenue on each project, identifying overbilled and underbilled positions.

Heavy equipment used in operations is reported as property, plant and equipment (PP&E) on the balance sheet.

The key distinction is based on the nature of the risk. A contingency reserve is allocated for identified risks, or 'known unknowns'—risks you know might happen but are not certain about the impact. A management reserve is for unforeseen risks, or 'unknown unknowns'—events that were not identified during planning. The project manager typically controls the contingency reserve, whereas the management reserve requires senior management approval to use.

The periodicity assumption states that businesses can divide up their activities into artificial time periods. This assumption allows businesses to prepare financial statements at regular intervals, such as monthly, quarterly or annually to provide useful information to users. It helps in measuring and reporting the financial performance and position of the business over a specific period, facilitating comparisons and analysis.

In construction audits, auditors focus on internal controls, operating systems and procedures, and project management because these directly affect how financial data is generated and reported. Construction equipment is a physical asset category, not a distinct area of audit procedure focus — equipment-related transactions are captured within other areas like contract costs rather than examined separately.

Joint checks require both parties to endorse them, ensuring sub-tier payments come directly from the owner's funds rather than the GC's operating cash, reducing the GC's financing burden and lien risk.