an AIA billing application created with FOUNDATION
20 September 2017

How to Create an AIA Billing With FOUNDATION®

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Looking at what AIA billing is (Part 1) and how an AIA application works (Part 2), creating one might seem like a lot of work without the right tools. After all, there can be a lot of back and forth. But don’t let that intimidate you! However bumpy those redlines might make your negotiations, you can see how it all comes together smoothly for contractors with integrated construction accounting software.

The process for an AIA billing in FOUNDATION has a few basic steps:

  1. Create an AIA billing record
  2. Create a schedule of values for Application 1
  3. Print and post the application
  4. Repeat as needed
  5. Release retainage

Create an AIA Billing Record

Setting up an overall billing record for your progress billing job in FOUNDATION means two things. First, all of your billing applications will be tied together, without reentering your previous work. This also lets you easily revert to a previous application in the job’s history — just in case.

Second, each application updates your job costs and aging automatically when you “post” it in the system. Simply selecting your customer and job ties it into the rest of your data. Fields for header information and more fill right into the form for you.

creating an AIA billing in the FOUNDATION entry screen

Create a Schedule of Values

Your schedule of values is just next door under the “Billing” tab, and that’s where you’ll always find it whenever you need to modify your billing applications later.

You can build your schedule of values by simply adding the line items you need and filling out “Schedule Value” column. For any work done on the first application, enter either a dollar amount in the “Completed This Period” column or else a percentage complete to date, along with any stored material and retainage.

FOUNDATION does the calculations for you and fills in any defaults you’ve set up. Plus, it’ll let you know if there are any required fields you’ve left blank when you save it.

AIA schedule of values in FOUNDATION construction accounting software

Print and Post the Application

Because AIA Contract Documents® like Document G701™ and Document G702™ are copyrighted by the American Institute of Architects, FOUNDATION enables you to use your official AIA documents by printing your billing information right onto the forms.

AIA schedule of values from FOUNDATION construction software

But that makes it pretty hard to know what you’re looking at, right? That’s why FOUNDATION also lets you create an unofficial “AIA Type Document” just for your internal review purposes. That way you can simulate what your official printed document will look like before you make it official.

an AIA billing created in FOUNDATION construction accounting software

If you need to go back and make changes after printing your “pencil” copy, go right back to the schedule of values you saved. If you need to make changes after you’ve officially posted the billing to your G/L, you can immediately roll everything back to any previous application — or all the way to the beginning. It’s OK — that’s why pencils come with erasers!

When you do post the billing, everything will hit your A/R and your G/L with one click. It even opens a corresponding invoice to receive payment against. As well as printing a transaction audit trail, FOUNDATION gives you a quick debits-and-credits summary of the impact on your G/L, including separate retainage. You can print it or save it to your computer for your own records.

Repeat

With that, you’ve created your first AIA billing application. To complete your next application, you would simply pull up your schedule of values again. It’ll already be queued up as the next application number. Add any updates for the period on each line item.

If you need to introduce additional line items, everything works the same way as before. You can even specify change orders to the date.

how to create an AIA billing in FOUNDATION

Once you’re ready, you post the new AIA application just like your first one, and G/L accounts update accordingly.

As many billing applications as you need to create, the system keeps doing the work for you.

Release Retainage

When it comes time at the end of the contract to release retainage, guess where you go — the schedule of values! Here, you’re posting your final application. If your only update is to release those last withheld amounts to be billed, all you need to do is click the [Clear Retainage] button.

how to release retainage in FOUNDATION construction software

When you post the billing, it moves all of those accumulated retainage amounts over into your designated receivables account. Once that payment comes in, the invoice is already there for you to receive cash against. And all of that detailed history stays in your system so you can review and report it even years later.

That’s it!

Conclusion

With fully integrated accounting software for construction, all of the tweaks, changes and updates of AIA billing don’t need to trip you up in the office. Technology lets you do less by hand, with automatic calculations, an organized paper trail and no double entry.

Of course, FOUNDATION is just one set of integrated construction accounting tools to make AIA billing easier. You can see how it all fits together and whether it’s a fit your business by watching a self-guided product tour. Then, talk to us in a live demonstration and learn what other ways an integrated construction accounting system can help your business.

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