Pay Applications Explained for Owners: AIA G702 and G703

The two documents, in brief

The G703 is the detail: a schedule of values (SOV) that breaks the contract into line items, and for each line shows the scheduled value, work completed in previous periods, work completed this period, and the total completed to date.

The G702 is the summary and the certification: it rolls the G703 up to a contract total, subtracts retainage, subtracts what was previously certified, and arrives at the current payment due. The contractor signs it, the architect certifies it, and the owner funds it.

The G702 math owners should understand

The form telescopes: each application bills cumulative progress, then nets out what was already certified. The lines that deserve an owner's attention:

• Work completed to date: the cumulative claim, not this month's work. This month's billing is the difference between this application's cumulative figure and the last one's.
• Retainage: a percentage withheld from work in place until completion. The rate should match your contract, and the amount held should grow with the work, not with the calendar.
• Less previous certificates (line 6): everything already certified for payment, whether or not the check has gone out. This is the line that prevents double billing.
• Current payment due: cumulative work, minus retainage, minus previous certificates. If that arithmetic does not reproduce the number on the page, stop.

Where owners get burned

Most pay-application problems are not fraud; they are drift in cumulative math that nobody re-checks:

• Previous certificates counted only when paid: if an approved-but-unpaid application does not reduce the next one, the owner is billed twice for the same work.
• Front-loading: SOV lines for early work priced above their real value, so the contractor is overpaid relative to progress if the project stalls.
• Retainage at the wrong rate: the contract says one percentage, the application quietly uses another.
• Progress claims out of step with the field: a percent complete on paper that a site walk would not support.

A pre-approval checklist

Before approving any application, an owner or owner's rep should be able to answer yes to each of these: Does the cumulative math telescope correctly from the prior application? Does the retainage rate match the contract? Does line 6 include everything previously certified, not just previously paid? Does the claimed progress match what is actually in place? Is the application within the contract sum, including approved change orders and nothing else?

How OwnerLogix handles pay applications

OwnerLogix tracks pay applications the way the G702/G703 actually works: schedule-of-values line items, cumulative work completed to date, retainage at the rate your contract specifies, and previous certificates counted on the certification basis, so an approved application reduces the next one whether or not the check has cleared. Applications route through the owner's approval workflow with a dollar confirmation threshold and an audit trail, and the whole history stays in the owner's own record. It connects to the contractor's Procore, or takes CSV import or direct entry.

Frequently asked