Contract documents

May 9, 2024

Billing in the construction industry has always been a challenge, even for the large, established contractors, but it’s even more of an obstacle for the smaller ones. Hiring, retention, efficiency of operations, strategic sales, and marketing, and staying abreast of industry trends are all essential to the success of any construction business. Driving revenues that ultimately translate into profits is also important, but even more significant is securing the outstanding funds related to those two core financial metrics.

For the duration of the time the construction industry has been a part of the global economy, billing has been one of the primary obstacles for contractors. Time is money in this industry and having a reliable, durable billing solution to drive this critical piece of the business model is a gamechanger.

Billing and securing payment for work done is the lifeline of the construction industry. Fortunately, AIA Contract Documents offers a slew of billing applications to help make this process easy for contractors, including AIA Document G702-1992. This payment application is especially useful in instances where the contractor is dealing directly with the architect on a project.

Inside G702-1992

AIA Document G702-1992 is a convenient and easy to use billing application that helps contractors navigate the billing process and helps them receive payment in a fraction of the time it might otherwise take. Contractors are required to present several pieces of information to complete this document including:

• Project Information: Key information including address, name, and key points of contact are included in this section.
• Project Status: Contractors must show the status of the contract sum to date. This includes the total dollar amount of any work already completed and the outstanding retainage amount.
• Total Sum of Previous Payments: If there have been previous payments made to the contractor, this billing application requires that those amounts be included in the document. This will give the recipient a clear understanding of the work that’s been completed and where the project stands.

Things to Remember

When completing AIA Document G702-1992 or any other billing application such as AIA Document G703-1992 Continuation Sheet, accuracy is a must. The document was designed to reduce the possibility of errors, but attention to detail remains a must. Any wrong information can result in costly delays that have the potential to derail an entire billing cycle or in some instances, an entire project. With that, users are encouraged to check this document several times before submitting for final approval and payment.

Conclusion

Billing is an important piece of the construction financial mix, and billing applications can ease the pain that this area of operations typically holds. If they’re used properly, this valuable resource can free contractors so they can focus on the work they were hired to do while ensuring they receive timely payments in a manner that allows them to run and build sustainable businesses.

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AIA Contract Documents has provided this article for general informational purposes only. The information provided is not legal opinion or legal advice and does not create an attorney-client relationship of any kind. This article is also not intended to provide guidance as to how project parties should interpret their specific contracts or resolve contract disputes, as those decisions will need to be made in consultation with legal counsel, insurance counsel, and other professionals, and based upon a multitude of factors.