PSAD Civil Engineering Licensure Examination (CELE) Practice Test

In contract administration, what is the purpose of a change order?

To Document and Authorize Changes in Scope, Cost, or Schedule Agreed by the Parties To Terminate the Contract To Assign a New Contractor To Increase Payment Without Change in Scope

Correct Answer:

To Document and Authorize Changes in Scope, Cost, or Schedule Agreed by the Parties

Explanation:

When a project needs alterations after the contract is signed, a change order serves as the formal instrument to record and authorize those modifications. It captures exactly what is changing in the work, how much extra (or less) it will cost, and how the project timeline will be affected, with approval from the parties involved. This creates a clear, auditable record so everyone understands the new scope, price, and schedule, and it ensures payment and scheduling adjustments are made only with mutual agreement. In practice, a change order documents the changed scope, any revised quantities or unit prices, and the revised completion date, tying everything back to the original contract terms.

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