AIA G702 and G703, explained with a worked example

AIA describes G702 as serving as both the contractor’s application and the architect’s certification. It is designed for projects where the contractor has a direct agreement with the owner, with payment procedures set out in AIA A201, General Conditions. The contractor signs it (and has it notarized where the contract calls for that), attaches the G703 and submits both to the architect. The architect may certify a different amount — initialing changed figures and attaching an explanation — and the owner pays the contractor the amount certified.

AIA’s instructions say columns A–C should match the schedule of values the contractor submitted at the start of the project. Approved change orders are usually listed separately, at the end of the basic schedule or on their own sheet. Column I (retainage) is normally used only when the contract allows a different retainage rate per line.

The project is fictional: an original contract of $1,000,000, one approved change order for $25,000 (parking-lot lighting) and 10% retainage on both completed work and stored materials. Two applications have already been paid. This period the contractor completed steel, concrete, MEP rough-in and part of the change-order work, and has roofing and mechanical equipment stored on site.

Check the math the way an owner’s reviewer will: work this period plus newly stored material is $229,000 + $30,000 = $259,000. Less 10% retainage, that is $233,100 — the same as line 8. If those two numbers disagree, something in column D does not match the previous application.

1. 1

   Step 1

   Confirm the schedule of values: every line item and its scheduled value, with approved change orders added as their own lines, totaling the contract sum to date.
2. 2

   Step 2

   Fill column D (work completed on previous applications) with columns D + E from the last approved application, line by line.
3. 3

   Step 3

   Enter column E: the value of work completed on each line during this billing period, usually from a percent-complete walk with the project manager.
4. 4

   Step 4

   Enter column F: materials delivered and stored but not yet installed, with the invoices or bills of sale the owner requires.
5. 5

   Step 5

   Calculate column G (D + E + F), percent complete (G ÷ C), balance to finish (C − G) and retainage per line.
6. 6

   Step 6

   Carry the column totals to the summary: completed and stored to date, retainage on completed work and on stored material, total earned less retainage.
7. 7

   Step 7

   Subtract previous certificates for payment to get the current payment due, then sign, notarize if your contract requires it, and submit with backup and lien waivers.

• Column D does not match last month. Column D on each line should equal columns D + E from the previous approved application. Material stored last period and installed this period moves out of column F and into column E.
• Billing pending change orders. Only approved change orders belong on the sheet and in line 2.
• Front-loaded schedule of values. Over-valuing early line items gets challenged by the architect and can be rejected outright.
• Stored materials without backup. Owners usually require invoices, insurance and proof of storage location before paying column F.
• Wrong retainage basis. Retainage applies to completed work and stored material separately; some contracts reduce it after a completion milestone.
• Missing waivers. Many owners require a conditional waiver for this payment and unconditional waivers for the last one — see lien waivers.

In Aequo Build, the AIA billing register creates a pay application from the job’s schedule of values, carries forward previous certificates, adds approved change orders, applies the job’s retainage rate (including step-down retainage schedules) and generates a G702/G703-style PDF for submission. See how other tools compare in our AIA billing software comparison.