If You Are Making Any of These Payment Application Mistakes Then You Are Losing Money
Posted on June 10, 2020
There is a seemingly endless list of issues that can delay projects, but payment application mistakes are one of the bigger issues. If you find that you are making any of these mistakes, do not make the further mistake of assuming it is “no big deal.” These mistakes can cause serious delays and unnecessary costs. Remember that at Fund Control, we can help many in various financial organizations as they navigate these issues.
Either Not Turning in a Pay Application or Doing So Late
If you do not submit an invoice or pay application, then you cannot expect to get paid for the work you do. This is why you should be sending invoices on the same day each month – so that nothing falls between the cracks. Subcontractors often have the most success billing around the 20th so that general contractors can include the invoice when they invoice the owner.
A general contractor should begin their invoicing process around the 25th of the month. It is essential to clearly mark the document as an “invoice” or “pay application” so that it does not get misidentified and filed as an estimate. If you submit this documentation late, the impact could be big. Subcontractors could be forced to wait until the next month for their fees to be charged and billed to the owner – which could mean two months until payment.
Not Using the Correct Form
If you are not using the correct form, processing can be significantly slowed down and payment can be delayed. If it is requested that you use a progress billing application as provided by the project owner or general contractor then you should do that. Make sure that you know exactly what is needed on your form. For example, some companies require a breakdown of all work, how much of each of the tasks have been completed at the time of billing, and more.
Not Providing Correct Information
If you use incorrect math or enter the wrong amounts, you may have your invoice returned with a request for you to revise it – or it could be outright rejected and you may have to begin the process all over again. This is why you must be sure to verify all amounts and do the math twice to ensure it is correct.
This is yet another way that Fund Control can make a difference. These errors are often the result of redundancy. For example, when an employee must enter the same data into several places, their chance of making a mistake goes up each time they enter it. When you use our innovative product, you can just enter it once and keep all the information you need. Contact Fund Control at 800-625-5972 to learn how you can get a free demo and see the results for yourself.