Construction Application for Payment (AIA G702/G703): Complete Filing Guide
- Cost Construction Accounting
- 3 hours ago
- 6 min read
Imagine submitting a payment application for a major commercial project, only to have it rejected due to mismatched totals or missing lien waivers. Your payment gets delayed by three weeks. Subcontractors start calling about their checks. Your cash flow takes a hit, and project relationships get strained.
This scenario happens more often than it should. For construction owners, GCs, and subcontractors across the US, mastering the AIA G702 and G703 forms isn't optional, it's essential for maintaining healthy cash flow and avoiding payment disputes that can cripple your business.
Understanding AIA Payment Applications
What Are G702 and G703 Forms?
The AIA G702 (Application and Certificate for Payment) and G703 (Continuation Sheet) are industry-standard documents used to request progress payments on construction projects.
G702 is the cover page:Â summarizing your contract value, total work completed, retainage held, previous payments, and current amount requested. Both contractor and architect must sign to certify accuracy.
G703 is the detailed breakdown:Â using your Schedule of Values. It itemizes work by category and shows completed work this period, cumulative totals, stored materials, retainage withheld, and remaining balance.
Why These Forms Matter
You've probably experienced getting a payment request kicked back with questions about unclear totals or missing documentation. The G702/G703 forms prevent these problems by creating a standardized format everyone in construction recognizes.
Most contracts now require these forms. Lenders and surety companies mandate them. State lien laws reference them. Proper use helps you manage retainage (typically 5-10%), track change orders, and maintain documentation that supports payment claims if disputes arise.
Preparing Your Payment Application
Information You Need Before Starting
Don't start filling out forms until you have everything ready. Scrambling for missing information wastes time and leads to errors.
Essential documents:
Signed contract with original Schedule of Values
All approved change orders (signed copies)
Previous payment applications
Time sheets and labor records
Subcontractor invoices and completion certificates
Material delivery receipts and invoices
Photos documenting stored materials
Lien waivers from subs and suppliers
Insurance certificates (if required)
Set Up Your Schedule of Values
Your SOV breaks down the total contract value into line items with assigned dollar amounts. Create it during project setup, not when rushing to submit your first payment app.
Example: A $1 million commercial build might allocate 8% ($80,000) to site work, 12% ($120,000) to foundation, and 25% ($250,000) to framing. These percentages should reflect actual costs plus markup.
Check Compliance Requirements
What's the submission deadline? (Typically monthly by the 25th or end of month)
How much notice is required before the deadline?
Where and how should you submit? (Email, portal, physical copy?)
What supporting documents are mandatory?
Are there prevailing wage or certified payroll requirements?
What are the retainage terms? (Percentage, when it reduces or releases)
For federally funded projects, ensure Davis-Bacon Act compliance with certified payroll. State-specific prompt payment laws also affect submission timing and processing requirements.
Step-by-Step: Filling Out G702 and G703
Step 1: Basic Project Information
Both forms need consistent header information.
Enter on both:
Project name and address
Owner, contractor, and architect names
Contract date
Application number (sequential: 1, 2, 3)
Period covered (e.g., November 1-30, 2025)
Submission date
Use official names exactly as they appear in your contract.
Step 2: Complete the G703 Breakdown
Each line item from your Schedule of Values gets its own row.
For each line item:
Column A:Â Item Number (sequential)
Column B:Â Description (e.g., "Site Work & Excavation")
Column C:Â Scheduled Value (original contract amount)
Column D:Â Work Completed From Previous Application
Column E:Â Work Completed This Period
Column F:Â Total Completed and Stored to Date (D + E)
Column G:Â Materials Presently Stored (requires documentation)
Column H:Â Total Completed and Stored (F + G)
Column I: % Complete (H ÷ total value)
Column J:Â Balance to Finish
Column K:Â Retainage (typically 5-10% of H)
Example:
Foundation Work: Scheduled Value $100,000
Previous Completed: $60,000
This Period: $30,000
Total Completed: $90,000
Stored Materials: $0
Retainage (5%): $4,500
Balance to Finish: $10,000
Step 3: Summarize on the G702
Transfer G703 totals to G702.
Key fields:
Original Contract Sum
Net Change by Change Orders
Contract Sum to Date
Total Completed and Stored to Date (from G703 Column H)
Retainage (from G703 Column K)
Total Earned Less Retainage
Less Previous Certificates for Payment
Current Payment Due
Balance to Finish
Double-check your math. One wrong number can derail the application.
Step 4: Add Certifications and Signatures
The contractor certifies the application is accurate and work conforms to contract documents. The architect reviews, verifies amounts, and either approves or notes adjustments.
Don't forge or skip signatures, this is a legal document.
Step 5: Attach Supporting Documents
Standard attachments:
Conditional lien waivers from all subs and suppliers
Unconditional lien waivers for payments two periods back
Approved change order documentation
Photos and receipts for stored materials
Daily logs or progress photos
Certified payroll (if required)
Insurance certificates (if required)
Create a cover sheet listing all attachments to speed review.
Real Example: Success vs. Failure
Success Story
A GC building a $2.5 million retail store submitted Application 4 with complete documentation.
G703 showed:
Foundation: 100% complete ($200,000, $10,000 retainage)
Framing: 60% complete ($180,000 of $300,000, $9,000 retainage)
Change Order 3: Utility work ($50,000 approved and completed)
G702 summary:
Contract sum: $2,550,000
Total completed: $800,000
Retainage: $40,000
Previous payments: $600,000
Current due: $160,000
They included lien waivers, photos, and signed change orders. The architect approved in seven days. Payment processed within 30 days.
Failure Story
A residential sub submitted an HVAC application showing 80% complete and billed $80,000 of a $100,000 contract. When the architect visited, only rough-in was complete about 40% of actual work.
The application was rejected. Payment delayed six weeks. The relationship with the GC was damaged. The sub paid $3,200 in short-term loan interest to cover payroll.
Lesson:Â Never overbill. Your forms must match what's visible on the jobsite.
Common Mistakes That Delay Payment
Overbilling or underbilling:Â Requesting payment for incomplete work can get you removed from the project. But underbilling hurts cash flow. Match billing to actual progress verified by site photos and inspection reports.
Missing change orders:Â If you completed extra work without approved change orders, your application will be rejected. Maintain a digital change order log and review before every submission.
Math errors:Â Retainage calculations or totals that don't match between G702 and G703 create red flags. Use software or spreadsheet formulas to eliminate errors.
Incomplete documents:Â Missing even one lien waiver can hold up payment. Create a submission checklist.
Late submissions:Â Missing deadlines pushes payment to the next cycle, potentially 30-60 days away. Submit early.
Tools for Faster Applications
Procore:Â Auto-populates forms from your SOV, tracks changes, includes e-signatures, integrates with QuickBooks. Best for mid-to-large GCs.
Sage 100 Contractor:Â Creates applications from job costing data with built-in compliance checks. Ideal for contractors prioritizing accounting accuracy.
Autodesk Construction Cloud:Â Combines document management with billing workflows. Good for larger GCs with complex approval chains.
Free option:Â Download Excel templates from aia.org and customize for your Schedule of Values.
Best Practices for Smooth Processing
Communicate proactively:Â Share draft applications with your architect before official submission. A five-minute conversation can prevent a two-week delay.
Review before submitting: Have a second person review for errors. Fresh eyes catch mistakes.
Track submissions:Â Maintain a log showing submission dates, amounts, approval dates, and payment received dates.
Train your team:Â Hold training sessions and create internal procedures. Designate backup personnel.
Update annually:Â Review your process and adjust for new lien laws or contract requirements.
Improve Your Cash Flow Today
Mastering AIA G702 and G703 forms protects your cash flow and builds a more profitable construction business. Contractors who submit clean, accurate applications get paid faster and face fewer disputes.
Review your current process. Are you making common mistakes? Are you using tools that automate calculations? Do you have complete documentation?
The contractors who get paid consistently aren't lucky, they're disciplined about documentation, accurate with numbers, and proactive about submitting clean applications.
Need help setting up efficient billing processes? Construction Cost Accounting specializes in helping construction owners, GCs, and subcontractors build financial systems that support healthy cash flow and project profitability.
