An AIA-style invoice is the standardized progress-billing package that contractors submit on commercial and large residential construction projects to request payment for work completed during a billing cycle. It consists of two forms developed by the American Institute of Architects: Document G702, a one-page payment application and certification summary, and Document G703, the itemized continuation sheet that shows how far along each portion of the work has progressed. Owners, architects, and construction lenders across the country rely on this format because it produces a consistent, auditable record everyone reads the same way.
The Schedule of Values Comes First
No AIA invoice makes sense without an approved schedule of values behind it. Before the first payment application goes out, the contractor breaks the entire contract sum into individual line items for each distinct portion of the work — demolition, concrete, framing, plumbing rough-in, finish carpentry, and so on — and assigns each one a dollar value that represents its share of the total contract price. The architect reviews and approves the schedule to confirm the values reasonably reflect the actual cost of each work category.1AIA Contract Documents. Schedule of Values in Construction: What It Is and Why It Is Required on Construction Projects
That approval matters because every future invoice is measured against these same numbers. Each billing cycle, the contractor reports progress against each line. If the schedule inflates the value of early work like site preparation and shortchanges later phases like finishes, the contractor collects a disproportionate share of the money before the project is half done. Architects scrutinize the schedule specifically to catch this kind of front-loading before it becomes a billing problem.
What the G702 Summary Shows
The G702 is the cover page. On one sheet, it gives the owner a snapshot of the project’s finances as of the current billing period: the original contract sum, the net dollar effect of all approved change orders, the revised contract total, the value of work completed and materials stored to date, the retainage being withheld, the total of previous payments, and the amount now being requested.2AIA Contract Documents. Summary: G702-1992, Application and Certificate for Payment
The change order section is where billing disputes often begin. The G702 separates approved additions from deductions and combines them into a net figure that adjusts the original contract sum up or down. That adjusted number, the contract sum to date, feeds every other calculation on the form. An error here cascades through the whole application.
What the G703 Continuation Sheet Shows
The G703 is where the detail lives. It lists every line from the approved schedule of values and tracks each one across a series of columns: item number, description, scheduled value, work completed on previous applications, work completed during the current period, materials presently stored, total completed and stored to date, the percentage that total represents, the balance remaining to finish, and retainage.3AIA Contract Documents. Instructions: G703-1992, Continuation Sheet
The math flows left to right. Previous work plus current work plus stored materials equals total completed and stored. That total divided by the scheduled value produces the completion percentage. Scheduled value minus the total gives the balance to finish. Retainage is calculated as a percentage of the completed work. Every line rolls up to the summary figures on the G702, which is why many contractors use construction accounting software to keep the arithmetic clean.
Billing for Stored Materials
The stored-materials column lets a contractor bill for items delivered but not yet installed: lumber on site, mechanical equipment in a staging area, custom millwork awaiting installation. As those materials get incorporated into the work, their value shifts out of the stored column and into work completed.3AIA Contract Documents. Instructions: G703-1992, Continuation Sheet
Off-site storage carries extra conditions. Under standard AIA terms, billing for materials stored off-site requires the owner’s advance approval and typically comes with protections: proof of insurance at the storage facility, a transfer-of-title document, an itemized inventory with values, and photographs showing the materials labeled with the project name. The owner is paying for something they can’t see from the job site, and these requirements exist to prove the materials actually exist and belong to the project.
What Gets Attached to the Invoice
A completed G702 and G703 rarely travel alone. Most contracts require a supporting packet.
Lien Waivers
Lien waivers are the most consequential attachments. When a contractor signs one, they give up the right to place a lien against the property for the amount covered by the waiver. Standard practice uses four variations: a conditional waiver for the current payment (effective only once the check clears), an unconditional waiver for the previous payment (confirming those funds were received), and parallel versions from each subcontractor and major supplier. Conditional waivers keep contractors from waiving rights before money actually arrives. Unconditional waivers keep owners from paying twice for the same work. Collecting waivers from every tier is tedious but critical; a missing subcontractor waiver can leave the owner exposed to a lien even after paying the general contractor in full.
Notarization and Insurance
AIA’s own instructions direct the contractor to sign the G702 and have it notarized before submitting it to the architect.4AIA Contract Documents. Instructions: G702-1992, Application and Certificate for Payment Whether notarization is actually required on a given project depends on contract language — AIA A201 qualifies it with “if required” — but most commercial contracts and virtually all projects with construction lenders do require it. The notary verifies the signer’s identity and confirms voluntary execution, which turns the application into a sworn statement. Contracts may also require updated certificates of insurance showing general liability and workers’ compensation coverage are still active.
Submission, Architect Review, and Certification
Under AIA A201, the contractor submits each application to the architect at least ten days before the scheduled progress-payment date. The architect then has seven days to take one of three actions: certify the full amount requested, certify a reduced amount with written reasons, or withhold certification with written reasons.5AIA Contract Documents. AIA Document A201-2017 General Conditions of the Contract for Construction
The review is more than paperwork. It typically includes a site visit to verify that physical progress matches the percentages claimed on the continuation sheet. That inspection is the primary defense against front-loading. Architects who have done this long enough develop a feel for applications that don’t match what they saw on site the week before, and they will mark down a line item before certifying.
Once the architect signs the certification section of the G702, the owner is authorized to release payment. The certification does not guarantee the work is free of defects. It confirms that, based on the architect’s review, the amount requested is properly due under the contract.
When the Owner Has to Pay
How quickly the owner must pay after certification depends on the contract. AIA A201 does not fix a specific number of days; it defers to whatever timeline the parties agreed to. On private commercial projects, most states have enacted their own prompt payment statutes with deadlines that typically run 14 to 45 days after receipt of a certified application. The window varies by state and sometimes depends on whether the paying party is the owner, a general contractor paying a subcontractor, or a subcontractor paying a supplier.
Federal projects are different. The federal Prompt Payment Act applies only to contracts with federal government agencies, not to private construction.6Office of the Law Revision Counsel. United States Code Title 31 Section 3901 On those contracts, the standard payment deadline is 30 days after the billing office receives a proper invoice or the government accepts the work, whichever is later, and late payments accrue interest at a rate set by Treasury.7Acquisition.GOV. 48 CFR 52.232-25 Prompt Payment
When an owner fails to pay after a certified application, the remedies escalate quickly. Under AIA A201, if certification or payment does not arrive within the contractual timeline, the contractor can give seven days’ written notice and then stop work entirely until the overdue amount is paid. If non-payment continues for 30 consecutive days, the contractor can terminate the contract altogether and recover payment for all work properly completed plus reasonable shutdown costs.5AIA Contract Documents. AIA Document A201-2017 General Conditions of the Contract for Construction Owners who treat payment deadlines casually tend to learn that lesson expensively.
Retainage and Closing the Contract Out
Retainage is the percentage of each progress payment the owner holds back as a financial incentive for the contractor to finish. Typical rates run between 5% and 10% of completed work, though contract terms and state statutory caps set the actual number.8ConsensusDocs. Its My Retainage and I Want It Now – Fundamentals to Requirements and Entitlement for Retainage The withheld amount appears as a deduction on every invoice throughout the project, and on a large contract it accumulates into a substantial sum.
Retainage release is triggered by substantial completion, the point when the owner can use the building for its intended purpose even though minor punch-list items remain. The architect formalizes this milestone by issuing AIA Document G704, the Certificate of Substantial Completion.9AIA Contract Documents. The Four Most Overlooked Realities of Substantial Completion
Final payment follows once punch-list work is done and the contractor submits AIA Document G706, the Contractor’s Affidavit of Payment of Debts and Claims. That sworn statement confirms all subcontractors, suppliers, and laborers have been paid and lists any outstanding debts or claims connected to the project.10AIA Contract Documents. Contractors Affidavit of Payment Along with final unconditional lien waivers from every tier of the payment chain, the affidavit closes out the financial relationship between owner and contractor.
Sworn Numbers Carry Legal Weight
Because an AIA payment application is a sworn document backed by a notarized signature, inflating progress percentages or billing for materials that don’t exist is not just a contract breach. On projects involving federal funds, knowingly submitting a false application can trigger liability under the False Claims Act, with civil penalties and treble damages on top.11Federal Register. Civil Monetary Penalty Inflation Adjustment Separate criminal statutes covering major fraud against the United States can add prison terms of up to ten years for schemes involving contracts worth $1 million or more.
Even on purely private projects, a fraudulently inflated application exposes the contractor to state fraud charges, breach of contract claims, and near-certain loss of their contractor’s license. The notarized signature is what elevates this from a billing dispute to a legal problem. The contractor has sworn under penalty of perjury that the numbers are accurate, which is also why the architect’s site-visit step during certification is not optional in practice, regardless of what any contract says.