Q:
I am trying to figure out how to keep track of American Institute of Architects (AIA) billings. We use a small business accounting program, and I currently do all the calculations in a spreadsheet and then transfer the data over, line-by-line, to the AIA forms. Am I missing something? Is there a better way?
Cheryl
A:
The answers to your questions are yes and yes. What you are missing is a construction-specific accounting system that can automatically handle AIA billings, as well as all other construction billing methods (such as time and material, lump sum and unit price billing). A true job costing program, which integrates accounts receivable transactions with general ledger, job costing and other modules, eliminates the need for spreadsheets, duplicate data entry and a lot of unnecessary time spent creating invoices and tracking billings.
When it comes to AIA compliant billings, for example, most good construction accounting systems offer users the ability to:
- Minimize data entry with default calculations
- Print on blank forms or directly on to pre-printed forms (G702 and G703
- Adjust prior invoices
- Calculate different retainage percentages for each line item
- Define and track sales and use tax
- Add change orders and update AIA billings automatically with each application
If your current system is unable to handle AIA billing, chances are it is lacking in many other areas that are specific to construction. Meanwhile, the efficiencies you stand to gain in just this one area with a sophisticated job costing system may be well worth the investment.
Fred
Construction Business Owner, July 2009
