![]() ![]() ![]() Read more: Why it takes so long for payments to get processed in construction.It’s not uncommon for a subcontractor to be juggling different pay application requirements on every one of their jobs! What is required in a pay app, including the form that should be used, changes from project-to-project depending on the specific requirements set forth on that job. The other difficult thing about construction pay applications is that they are unique to each project. The difficulty in preparing pay applications, tracking them, and approving them is exactly why construction jobs have payment draw schedules. Since the payment application process can be complicated, it’s no wonder that the parties choose to do it only monthly. Certified payroll reports on a prevailing wage job.Lien waivers signed by the party submitting the payment application, and lien waivers collected from subcontractors, suppliers, and other vendors hired by the party submitting the payment application.Vendor invoices that organize and determine how much you owe to suppliers.Photo documentation for backup evidence of the work done / materials delivered.Daily reports that explain the details of the site and the job while providing a record to help keep subs and stakeholders informed.Schedule of values or continuation sheets identifying all the work completed and materials delivered during the pay period.Get paid faster by using pay apps and invoices togetherĪ pay application typically requires the following items to be included:.In fact, they are more like a full payment “package,” and since it requires many items that do not live within accounting systems, the package is usually assembled by-hand and involves a variety of people across an organization. Instead of preparing a simple invoice, construction job participants are required to prepare a full “application for payment.” These pay applications are much more robust than a simple invoice. On most construction jobs, the payment process and the method of applying for payment are quite unique. When owed money, the business owner or person in charge of bookkeeping generates an invoice using their accounting software package (such as Quickbooks for small businesses, or an enterprise ERP for bigger companies), and sends the invoice to their customer. In most industries, the invoicing and payment process is simple. Overview of payment applications: Common forms and partsĭifference between invoices & pay applications.Pay applications may also be called payment applications, applications for payment, or pay apps. The contract should provide detail on the form to use, documents to include, and application timing and deadlines. On each project, the pay application process will likely differ, since the application process is governed by the construction contract. In construction, a pay application is a group of documents exchanged between contractors during payment. ![]()
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