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A Joint Check Agreement is a contractual agreement in the construction industry used to ensure all parties involved in a project get paid. This agreement involves primarily three parties - the property owner, general contractor, and subcontractor or material supplier. The property owner or general contractor issues a check payable to both the subcontractor and materials supplier, providing a layer of protection against mechanic's lien. This means both parties must endorse the check for it to be cashed, ensuring the funds are distributed appropriately. This way, it mitigates the risk of non-payment for subcontractors and suppliers. Additionally, it helps the owner or general contractor to ensure project progression without disputes or delays related to payment issues. However, details of the agreement, like the proportion of payment to each party, need to be clearly outlined to avoid potential conflicts.

A Risk-Shifting Mechanism in the construction industry involves the transfer of potential financial risk from one party to another. Traditional contracts often place the responsibility for risks on the contractor. However, through risk-shifting methods such as sub-contracting, insurance, or performance bonds, some or all of the potential risks can be shifted away from the contractor and onto other parties, like subcontractors or insurance companies. The aim is to balance the risks more equitably, based on which party is best capable of managing those risks and to ensure that the project is not jeopardized due to unforeseen complications or accidents. Properly implemented, a risk-shifting mechanism can provide financial stability and predictability, thus improving the overall management and execution of construction projects.

AIA® billing is a standardized payment application process for construction projects. Developed by the American Institute of Architects (AIA®), it uses specific forms—primarily the G-702® Application and Certificate for Payment and G-703® Continuation Sheet—to document and request progress payments throughout a project. These forms create a uniform system for contractors that shows exactly what work has been completed, what materials have been stored, and what payment is due during each billing period. They also require detailed information about contract values, change orders, and retainage amounts. AIA® has become the industry standard, especially for larger commercial projects and government contracts.

For subcontractors, understanding AIA® billing is essential since most large general contractors (GCs) require these forms or customized versions of them. While AIA® billing can initially seem complex, it provides important benefits like reducing payment disputes, creating clear documentation of work progress, and often resulting in faster payments. Mastering AIA® billing opens doors to working with larger GCs and bidding on more substantial projects. That’s why we created this comprehensive guide, filled with detailed information on completing AIA® billing forms and managing the payment application process.

Siteline simplifies the AIA® billing process by automating form creation and submission. Our system currently maintains 15,000 custom billing forms from more than 10,000 GCs, enabling subcontractors to generate perfect pay apps in minutes for fewer delays and faster, more predictable payments. Schedule a no-obligation demo to see how Siteline can help you streamline AIA® billing and reduce invoice aging by at least 30%.