Change Order Tracking and AIA Billing: The Office Manager's Guide

DEFINITION

AIA G702/G703

Standard billing forms used in construction. G702 is the Application and Certificate for Payment (summary). G703 is the Continuation Sheet (line-item detail by schedule of values). Most GCs require these forms for progress billing on commercial projects. Preparing them manually in Excel is time-consuming and error-prone.

DEFINITION

Change Order

A formal modification to the original contract scope and price. When a GC requests additional work or modified specifications, the subcontractor submits a change order with cost impact. Until the CO is approved and incorporated into the billing, the sub is performing unbilled work.

DEFINITION

Retainage

A percentage of each progress payment (typically 5-10%) withheld by the GC or owner until project completion. Retainage must be tracked per job and per billing period. Releasing retainage after substantial completion requires accurate documentation of amounts withheld.

The Office Manager’s Billing Week

If you are the office manager or bookkeeper at a specialty trade subcontractor, billing week is probably the worst week of your month. You are pulling time sheets from foremen, matching material invoices to jobs, calculating percentage complete for each line item, assembling the AIA G702/G703 package, and getting it to the GC before their cutoff date. Miss the cutoff and your payment pushes 30 days.

On top of the standard billing, you are tracking change orders at various stages. The owner told the GC about added scope two weeks ago. Did the CO get submitted formally? Is it approved? Can you include it in this month’s billing or not? If you bill for an unapproved CO, the GC rejects the entire package.

This workflow is where most construction office managers spend a disproportionate amount of time relative to its complexity. The math is not hard. The data gathering is.

Where Spreadsheets Break Down

The Excel AIA template works until you have 5+ active jobs billing simultaneously. Each job has its own spreadsheet, its own schedule of values, its own change order log. Reconciling the G703 line items, making sure percentages add up to 100%, carrying retainage forward from last month, incorporating newly approved COs into the SOV: each of these is a manual step that introduces error potential.

The most common error is a math discrepancy in the G703 where line items do not sum to the G702 total. GCs check this immediately. When it does not reconcile, the package comes back for correction, costing you another day and potentially missing the billing cutoff.

We built MarginLock’s AIA billing feature specifically for office managers who are tired of the Excel reconciliation dance. The system generates G702/G703 documents from your job cost data. Line items match because they come from the same source. Math reconciles because the software does the arithmetic.

Change Order Tracking That Prevents Revenue Leakage

Change orders are where subcontractors leave money on the table most often. The scenario is familiar: the GC asks for additional work verbally. Your crew does the work. A month later when you try to bill for it, the GC says the CO was never approved. Now you have performed work you cannot bill for.

The fix is systematic tracking. When additional scope is identified, create the change order in your system with a cost estimate. Submit it to the GC. Track the approval status. Only include approved COs in billing. When a CO sits in “pending” for more than 2 weeks, escalate it.

MarginLock gives each CO a status field and links it to the job’s schedule of values. Approved COs are automatically added as new line items on the next AIA billing. Pending COs are visible on the job dashboard so the owner can follow up with the GC. This prevents the “we did the work but forgot to bill for it” problem.

Getting Paid Faster

Two factors control how fast you get paid: how quickly you submit a clean billing package and whether the GC accepts it on first submission. Software helps with both. Faster generation means you submit earlier in the billing window. Accurate math means fewer rejections. The combination can reduce your average collection period by 15-30 days, which for a $5M sub means tens of thousands of dollars in improved cash flow.