Florida Building Contractor Business/Finance Practice Exam

What types of changes typically require a change order in construction contracts?

1. Minor alterations only

2. Changes in scope or additional costs

3. Only delays in schedule

4. Changes to personnel

The correct answer is: Changes in scope or additional costs

In construction contracts, a change order is a formal document that modifies the original contract by outlining any changes in the work scope, pricing adjustments, or schedule impacts. The most common reasons for issuing a change order include changes in the scope of work or additional costs incurred during the project. When the owner or contractor identifies a need for changes—whether due to unforeseen conditions, alterations requested by the owner, or changes in plans and specifications—these alterations can necessitate a change order. This ensures that both parties have an understanding of how such changes will impact overall project costs and timelines. By creating a formal change order, the construction contract remains clear and legally binding, avoiding potential disputes down the line regarding expectations or costs. Other options may not adequately reflect the guidelines surrounding change orders. Minor alterations might not always require formal change orders if they are within the terms of the original contract. Delays in the schedule typically invoke specific terms related to time but don’t alone constitute a change in the work itself, and changes to personnel involve human resources issues rather than changes in the physical project scope. Therefore, changes in scope or additional costs represent the primary context in which change orders are generated in construction contracts.