What Is AIA Billing? A Contractor's Guide to G702 and G703 Pay Applications
AIA billing invoices construction projects by percent complete using the G702 and G703 forms. Here's how it works, why it stalls cash flow, and how to speed it
AIA billing is a standardized way to invoice on construction projects. Instead of a flat invoice, you bill by the percentage of work completed, using two AIA forms: the G702 (Application and Certificate for Payment) and the G703 (Continuation Sheet). It is the norm on most commercial and public jobs, and it is where a lot of contractors quietly lose time and cash flow.
If you have ever spent a Friday rebuilding a pay application in a spreadsheet, wondering whether your retainage math is right and when you will actually get paid, this guide is for you.
What is AIA billing, exactly?
AIA billing gets its name from the American Institute of Architects, which created the standard forms. The idea is simple: on a long construction project, you do not wait until the end to invoice. You bill in progress, each period, for the share of the contract you have completed so far.
Two forms do the work:
G702, the Application and Certificate for Payment. This is the cover sheet: total contract value, work completed to date, retainage held, and the amount due this period. It gets signed and certified.
G703, the Continuation Sheet. This is the detail behind the G702: your schedule of values broken into line items, with the percent complete and dollar amount for each.
Together they tell the owner and architect exactly what you have earned, and give them a certified document to approve before they pay.
How a pay application actually works
A typical AIA pay application follows the same rhythm every period:
You start from the schedule of values, the agreed breakdown of the contract into line items.
For each line, you enter the percent complete this period and to date.
The forms calculate work completed, materials stored, and the total earned.
Retainage, usually 5 to 10 percent, is held back on each application.
You submit the G702 and G703 for certification, and once approved, you invoice the net amount due.
Do that across several active jobs, every month, by hand, and you can see where the time goes.
Why AIA billing slows contractors down
The forms are not the problem. The manual work around them is. Most contractors run AIA billing on spreadsheets, and that creates predictable pain:
The percent-complete numbers come from the field, often as a text, a phone call, or someone's memory, and get re-typed into the billing sheet days later.
A single wrong figure ripples through the whole application, and errors get caught by the architect, not by you, which delays payment.
Retainage has to be tracked separately across every application and released correctly at the end, which is easy to get wrong.
Change orders that were approved in the field but never made it into the schedule of values simply do not get billed.
Every one of those is a cash-flow problem wearing a paperwork costume.
The real cost is cash flow, not paperwork
AIA billing sits directly on top of your cash. A pay application that is late, kicked back for an error, or missing a change order does not just cost you admin time. It delays the money, sometimes by a full billing cycle, and on a business running on tight margins and held retainage, that delay is expensive.
The contractors who handle AIA billing well are not working harder at it. They have connected the field to the billing, so the numbers are current and the applications go out clean the first time.
How to make AIA billing faster and cleaner
You do not need to change the forms. You need to change how the numbers get to them:
Pull percent-complete from the field automatically, so billing works from real progress instead of a re-typed guess.
Keep the schedule of values, change orders, and retainage in one connected system, not three spreadsheets.
Draft the G702 and G703 from that data, so an application is a review, not a rebuild.
Make sure every approved change order lands in the schedule of values before the next application goes out.
This is exactly the office-to-field gap that costs contractors margin everywhere else, and AIA billing is one of its most expensive symptoms.
How ManoByte helps
We connect the systems a contractor already runs, the CRM, the field platform, and accounting, so your pay applications draft from real project progress instead of a Friday spreadsheet session. Change orders get captured, retainage is tracked, and the application goes out clean, which means you get paid faster.
AIA billing FAQ
What forms are used for AIA billing?
The AIA G702 (Application and Certificate for Payment) and the G703 (Continuation Sheet). The G702 is the certified cover sheet, and the G703 is the line-item detail behind it.
What is retainage in AIA billing?
Retainage is a percentage of each payment, typically 5 to 10 percent, that the owner holds back until the project is complete. It is tracked on every application and released at the end.
What is a schedule of values?
It is the agreed breakdown of the total contract into individual line items. Every AIA pay application bills against it by percent complete.
Is AIA billing required?
It is not a law, but it is the standard on most commercial and public construction projects, and many contracts specify it. If you work on those jobs, you will use it.
How do you speed up AIA billing?
Stop running it by hand. Connect your field progress to your billing so pay applications draft from real data, keep change orders and retainage in one system, and submit clean applications the first time so they are not kicked back.