An Internal Change Order is a Change Order (CO) created for tracking changes in a project’s Bill of Materials (BoM) when:
The CO need not be shared externally with the customer for approval because you are in agreement with the customer about the changes.
The customer does not require a CO proposal for their internal record-keeping purposes.
Creating Internal COs
To create an internal CO, select “Internal” as the CO type when creating the CO. Once you create the CO, you can add, replace, and remove items.
Use the "Add items as non-billable" option to specify whether the items added to the CO need to be billed or not. For example, if the CO is for adding minor accessories and you want to provide this at no additional cost to the customer.
If you want help with creating a CO, check out this article.
Because internal COs do not need to be shared externally, you do not have the option to create the proposal.
Under “Projects > Change Orders” in the left navigation, Internal COs display an “Internal” label in the Kanban view and are listed as “Type=Internal” in the List view.
Approval for Internal COs
The Internal CO will need to be approved by the Project Manager for the CO changes to be factored into the project BoM.
Internal COs are assigned relevant CO states depending on who creates the CO.
This illustration depicts how internal COs move through the CO states when the CO is created by the Project Resource or the Project Manager.
Check out this article for more details about the Project Manager Approval process.