AIA Billing (G702/G703) in QuickBooks Online — Complete Guide

What Is AIA Billing?

AIA billing — named after the American Institute of Architects — is the standard method for billing on commercial construction contracts. It uses two specific forms:

• G702 — Application and Certificate for Payment (the summary page showing total contract value, work completed, retainage, and amount due this draw)
• G703 — Continuation Sheet (the line-by-line schedule of values showing each work item, its original value, % complete, and amount billed)

Every draw (monthly billing) requires a new G702/G703 package. The GC or owner reviews it, approves the amount, and issues payment — minus retainage.

Key Terms on the G702/G703

How to Track AIA Billing in QuickBooks Online

QuickBooks Online doesn't have a native G702/G703 form, but you can track AIA billing accurately with the right setup.

Step 1 — Create the Contract as an Estimate

Create an estimate in QBO for each job. Use line items that match your Schedule of Values — one line per SOV category (framing, electrical, plumbing, etc.). The estimate total = contract value.

This gives you the contract value that flows into your WIP schedule.

Step 2 — Create Invoices from the Estimate (Progress Invoicing)

Each draw, create an invoice in QBO using Progress Invoicing (enabled in QBO settings). This lets you bill a percentage of each estimate line item.

Set the % complete for each SOV line item on this draw. QBO calculates the dollar amount automatically.

Step 3 — Track Retainage

On each invoice, add a retainage line item as a negative amount (e.g., -10% of gross billings). Map it to a Retainage Receivable account on the balance sheet — not income.

When retainage is released at project closeout, create a separate invoice for the retainage amount and clear the Retainage Receivable balance.

Step 4 — Track Stored Materials (If Applicable)

If the GC approves billing for stored materials, create a separate line item on the invoice for the stored materials amount. Map it to a Stored Materials account or track it as part of the work-completed total.

Step 5 — Prepare the G702/G703 Outside QBO

QBO doesn't generate the actual G702/G703 PDF. You'll need to prepare the forms separately (Excel template, dedicated AIA billing software, or your client's GC/owner may have their own system). Use the QBO invoice data to populate the numbers.

How AIA Billing Affects the WIP Schedule

AIA billing creates a direct link between the G703 (schedule of values) and the WIP schedule. Specifically:

• Contract Value on WIP = Total contract value from G702
• Billed to Date on WIP = Cumulative net billings from all draws (not including retainage held)
• % Complete on WIP = Calculated from costs, not from the G703 % — the two should be close but won't always match exactly

A common mistake is using the G703 percentage of completion for the WIP schedule instead of the cost-to-cost method. The G703 % is based on work-in-place value, while the cost-to-cost method uses actual costs. For audit and bonding purposes, always use cost-to-cost.

Change Orders and AIA Billing

Change orders add to the contract value and must be reflected in both the G702 and QBO:

• Update the estimate in QBO to add the change order value (add a new line item for the CO or increase an existing one)
• The contract value on the WIP schedule automatically updates
• Add the change order line to the G703 in your billing forms

Unsigned or disputed change orders should NOT be added to the estimate until approved by the owner/GC.

AIA Billing Mistakes to Avoid

• Front-loading the SOV — allocating too much contract value to early line items (mobilization, demo) to improve early cash flow. Banks and GCs are watching for this.
• Overbilling stored materials — billing for materials not yet delivered to the job site
• Forgetting retainage on change orders — retainage applies to change order work too, not just original contract work
• Not recording retainage releases — when retainage is paid, it must clear the Retainage Receivable balance in QBO
• Using net billings (after retainage) for WIP — use gross billings for billed-to-date on the WIP schedule, track retainage separately

Tools That Make This Easier

Tracking AIA billing in QBO manually is manageable for one or two projects. For bookkeepers handling multiple commercial construction clients, it becomes complex fast — especially when you need to reconcile the G703, the QBO invoices, the retainage accounts, and the WIP schedule all at once.

ReconcileBook pulls contract values, billings (net of retainage), and costs directly from QuickBooks Online and generates the WIP schedule automatically. Retainage is tracked as a separate column, and over/under billings are calculated in real time — no Excel required.