🚧 The Dark Side of Progress Billing in Construction 🚧
Most construction businesses use AIA-style progress billing. But what many don’t realize is that it’s 𝐨𝐧𝐞 𝐨𝐟 𝐭𝐡𝐞 𝐞𝐚𝐬𝐢𝐞𝐬𝐭 𝐰𝐚𝐲𝐬 𝐭𝐨 𝐦𝐚𝐧𝐢𝐩𝐮𝐥𝐚𝐭𝐞 𝐫𝐞𝐯𝐞𝐧𝐮𝐞—on paper.
As a forensic construction accountant, I’ve seen:
- Overstated work completed to boost cash flow.
- Undocumented stored materials creating inflated pay apps.
- Retainage games hiding serious cash shortages.
This doesn’t just hurt the GC’s financials—it puts lenders, bonding companies, and subcontractors at risk.
𝐈𝐟 𝐲𝐨𝐮𝐫 𝐛𝐢𝐥𝐥𝐢𝐧𝐠 𝐝𝐨𝐞𝐬𝐧'𝐭 𝐦𝐚𝐭𝐜𝐡 𝐚𝐜𝐭𝐮𝐚𝐥 𝐰𝐨𝐫𝐤 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞𝐝, 𝐲𝐨𝐮’𝐫𝐞 𝐧𝐨𝐭 𝐣𝐮𝐬𝐭 𝐦𝐢𝐬𝐫𝐞𝐩𝐨𝐫𝐭𝐢𝐧𝐠—𝐲𝐨𝐮 𝐜𝐨𝐮𝐥𝐝 𝐛𝐞 𝐢𝐧𝐯𝐢𝐭𝐢𝐧𝐠 𝐚𝐧 𝐚𝐮𝐝𝐢𝐭.
👉 Contractors: when was the last time you reconciled your % complete to actual cost-to-date?
As a forensic construction accountant, I’ve seen:
- Overstated work completed to boost cash flow.
- Undocumented stored materials creating inflated pay apps.
- Retainage games hiding serious cash shortages.
This doesn’t just hurt the GC’s financials—it puts lenders, bonding companies, and subcontractors at risk.
𝐈𝐟 𝐲𝐨𝐮𝐫 𝐛𝐢𝐥𝐥𝐢𝐧𝐠 𝐝𝐨𝐞𝐬𝐧'𝐭 𝐦𝐚𝐭𝐜𝐡 𝐚𝐜𝐭𝐮𝐚𝐥 𝐰𝐨𝐫𝐤 𝐜𝐨𝐦𝐩𝐥𝐞𝐭𝐞𝐝, 𝐲𝐨𝐮’𝐫𝐞 𝐧𝐨𝐭 𝐣𝐮𝐬𝐭 𝐦𝐢𝐬𝐫𝐞𝐩𝐨𝐫𝐭𝐢𝐧𝐠—𝐲𝐨𝐮 𝐜𝐨𝐮𝐥𝐝 𝐛𝐞 𝐢𝐧𝐯𝐢𝐭𝐢𝐧𝐠 𝐚𝐧 𝐚𝐮𝐝𝐢𝐭.
👉 Contractors: when was the last time you reconciled your % complete to actual cost-to-date?
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