Contractor is updating the programme but not the Activity Schedule as it’s ‘too time consuming’. Numerous CE’s not on Activity Schedule. As PWDD is Total of Pricea for a completed activity without Defects, presumably the PM cannot include any work against the activities which are not shown on the schedule.
Once a compensation event is implemented then it can be added to the activity schedule and if completed that item will become payable that period. However, it is not necessary to revise and issue for acceptance a revised activity schedule every time there is a compensation event. The only time to do that is if the Contractor wants to redistribute the way the cost is spread as it no longer reflects their planned works.
Given that you assess their application - if you can see an item is missing from the activity schedule i.e. an implemented compensation event, then you could/should include that amount in the assessment. i am sure that the PM would be very quick to delete something that has not been complete, so equally should include something they now is complete and contractually payable!