Cost-to-complete (CTC) is the PM’s forecast of what it will still cost to finish the job. Done properly, it’s built bottom-up by cost code: remaining subcontract and PO commitments, remaining self-performed labor and material at realistic productivity, pending changes and known risks. It is not simply the remaining budget.
Why it matters
CTC is the most important estimate a contractor makes after the bid. It sets estimated total cost, which sets percent complete, earned revenue and profit. A CTC that just assumes “the remaining budget will be enough” is how jobs fade quietly for months and then drop margin all at once near the end.
Worked example
Illustrative: Riverside Medical Center’s estimated total cost is $43.68M and cost to date is $31.7M, so CTC is $11.98M.
Now Volt Electric (26 Electrical) is trending 4% over budget. If that code’s remaining budget was $2.5M, a realistic CTC on that line is closer to $2.6M. That extra $100,000 raises total cost and lowers projected margin. Updating CTC now shows it; leaving it as remaining budget hides it.
Common mistakes
- Setting CTC equal to remaining budget on every line.
- Forgetting open commitments that haven’t been invoiced yet.
- Not including costs for pending change events that are likely but unpriced.
How os.construction handles it
We’re building CTC forecasting by cost code on top of live commitments and job cost, with AI suggestions labeled as suggestions and the PM making the call.