Progress Billing
Invoicing based on the percentage of work completed rather than upon final delivery.
Definition
Progress billing is a method of invoicing where contractors bill for work completed during a specific period rather than waiting until project completion. Invoices are based on the percentage of completion against a schedule of values, allowing contractors to maintain cash flow throughout long-duration projects.
Why It Matters
Progress billing is essential for construction cash flow. Accurate validation prevents overpayment for incomplete work while ensuring contractors are paid fairly for completed milestones.
Examples
Monthly progress bill
A subcontractor on a $500,000 contract bills $75,000 for work completed in March, representing 15% progress.
Over-billing detection
Contractor claims 80% complete on framing but field inspection shows only 65%, preventing a $15,000 overpayment.
How Nexus AP Helps
Nexus AP validates progress billing against schedules of values, tracks cumulative billing, and flags potential over-billing before payment.
Start Free TrialFrequently Asked Questions
How often are progress bills submitted?
Typically monthly, aligned with the pay application schedule defined in the contract. Some fast-track projects may bill biweekly.
What is a schedule of values?
A detailed cost breakdown of the contract into line items that serves as the basis for progress billing and payment.
Category
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