AIA billing is the payment application process used on most commercial construction projects, based on standardized documents published by the American Institute of Architects (AIA). The core forms—the G702 (Application and Certificate for Payment) and G703 (Continuation Sheet)—have become the industry standard for submitting and certifying progress payments between subcontractors, general contractors (GCs), and owners.

What is AIA billing?

AIA billing refers to the use of AIA document forms to request periodic progress payments during construction. It's not a billing software system—it's a structured process built around two documents. Those documents define how much work has been completed, how much has been paid, and how much is owed for the current period.

If you work on commercial projects—particularly with larger owners, public entities, or institutional clients—you've almost certainly submitted a pay app using these forms. They're required by contract on many jobs, and they're widely accepted because they provide a consistent, auditable format that all parties understand.

The AIA G702: Application and Certificate for Payment

The G702 is the cover sheet of a pay application. It summarizes:

• The original contract sum
• Approved change orders (additions and deductions)
• The adjusted contract value
• The total value of work completed and stored materials to date
• The current period's payment request
• Retainage withheld
• The net amount due for the current period

The contractor completes the G702. The architect of record then certifies (or adjusts) the amount and signs off, which authorizes the owner to release payment. On design-build or projects without an owner's architect, the GC or owner's rep typically fulfills the certification role.

The AIA G703: Continuation Sheet (Schedule of Values)

The G703 is the line-item breakdown behind the G702 summary. It lists every major scope item from the original contract (called the Schedule of Values, or SOV), showing:

• The scheduled value for each line item
• Work completed in prior periods
• Work completed in the current period
• Materials stored on-site
• Total completed and stored to date
• Percentage complete per line item
• Retainage per line item
• Balance to finish

The G703 is where the actual work of billing happens. Each line item needs to reflect real progress. Overstating percent complete to front-load billing is called "front-end loading," and it's a serious issue that can create overbilling disputes and damage relationships with owners and GCs.

How to build a strong schedule of values

Your schedule of values (the initial G703) sets the foundation for every pay application that follows. A well-structured schedule of values:

• Breaks work into discrete, measurable line items. Avoid single large lump sums—they're impossible for owners to evaluate and create disputes over percent complete.
• Aligns with your cost codes. If your job cost system uses specific cost codes, your SOV line items should match. This makes it easy to verify that billed amounts align with actual cost incurrence.
• Front-loads reasonably, but not egregiously. It's normal to have higher early billings for mobilization and site preparation. It's problematic to bill 40% complete when you've spent 10% of the budget.
• Includes stored materials. If you're purchasing materials in advance and storing them on-site, you can typically bill them as stored materials on the G703. Make sure your contract allows it and that materials are suitably stored and insured.

The pay application cycle

A typical monthly pay application cycle looks like this:

1. Cutoff date: Usually the 25th or last day of the month, and all work completed through this date is billable
2. Internal review: The project manager (PM) or superintendent confirms percent complete for each G703 line item, and the total is reconciled against job cost
3. Prepare and submit: G702 and G703 are completed and submitted to the GC or owner, along with required attachments (lien waivers from subs, certified payroll if required, and schedule update)
4. Architect or owner review: Typically 7–14 days, per contract terms. The architect or owner may approve, adjust, or dispute line items.
5. Certification and payment: Once certified, payment is due within the contract's payment terms (often 30 days from certification)

Delays at any step extend the time to payment. If your pay application has errors, missing attachments, or disputed line items, it can kick back to step 2 and restart the clock.

How to process AIA pay applications on the AP side

If you're a GC processing AIA pay applications from subcontractors, your accounts payable (AP) workflow has to handle a few things that regular invoices don't require:

• Verify percent complete against field reports. If a sub bills 80% complete when your PM says they're at 60%, reconcile it before payment.
• Check for required attachments. Lien waivers, certified payroll, and insurance certificates are commonly required before you can release payment.
• Track retainage separately. The G702 makes the retention calculation explicit. Your AP system should reflect the retained amount as a payable, separate from the net payment amount.
• Match to the approved schedule of values. The first time you see a new line item on a G703 that wasn't in the original SOV, it needs review—it may represent an unapproved change.

Ramp's construction accounts payable automation uses OCR to capture the details and line items from invoices with 99% accuracy. For complex pay applications with multiple G703 line items, auto-coding routes each line to the right job and cost code. Your AP team isn't stuck manually entering data for every pay app cycle.

The system flags duplicates and discrepancies before payment clears. So if a sub bills twice for the same period, or amounts don't match your records, it's caught before the check goes out. Construction teams using Ramp process AP 2.4x faster, which matters when you're managing pay applications from 20 subs on an active project.

Common AIA billing mistakes to avoid

Overbilling percent complete. This creates a "front-loaded" billing that results in a negative balance later in the project. Owners and GCs track this and it damages trust.

Missing attachments. Skip a required lien waiver or certified payroll, and your pay application gets rejected, restarting the clock on your payment cycle.

Schedule of values that don't match cost codes. If your billing structure doesn't align with your job cost system, you can't verify that billed amounts reflect real cost incurrence. Build the SOV and the job cost code structure at the same time.

Late submissions. Most contracts have a cutoff date. Submitting after the cutoff means you miss the payment cycle and wait another month.

Not billing stored materials. If your contract allows it and you have materials on-site, bill them. It's cash flow you've earned.

How Ramp streamlines construction AP for pay applications

Managing AIA pay applications is fundamentally an accounts payable workflow—one that's more complex than standard invoice processing because of the retainage structure, required attachments, and line-item reconciliation work. Ramp's construction AP automation is built for exactly this: capturing invoice data accurately, routing approvals to the right PMs, scheduling payments on your terms, and closing pay cycles faster.

Try an interactive demo to see how Ramp handles construction AP.