Progress Invoicing is a standard feature of QuickBooks® Pro, Premier, and Enterprise editions; each of these versions also offer several options for invoicing as well. In order to implement the Progress Invoicing function you must also utilize the QuickBooks Estimate function – this will eliminate repetitive data entry and help you achieve good job costing reports, such as Estimate vs. Actual reports.
To activate Progress billing you MUST first log into QuickBooks as the QuickBooks Administrator and be in single-user mode. From the Edit menu -> choose Preferences -> scroll down to Jobs & Estimate -> and click on the Company Preferences tab. Once you are in the Company Preferences tab, review and set the options as follows:
- Do You Create Estimates – should be set to Yes
- Do You Do Progress Invoicing – should be set to Yes
- Warn about duplicate estimate numbers – should be checked (this will prevent you from creating two or more estimates for different jobs with the same estimate number)
- Don’t print items that have zero amount – this option SHOULD NOT be checked (this allows you to display line items on a progress invoice even if you are not billing for them on the current invoice)
- Click Ok to save the changes that you have made.
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At this point, you can switch to multi-user mode so you and others can continue working.
Next, you’ll want to build your Estimate or Schedule of Values using the Job Cost Codes found in your QuickBooks item list. You will want to make sure that you QuickBooks Items or Job Cost Codes are set up as double-sided items in order to capture both expenses and income.
Your Estimate can be as simple or as detailed as you like – bearing in mind that an Estimate with multiple lines will provide better job costing information than a single line Estimate with the full dollar amount.
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Once you have your Estimate in place and you are ready to create your first progressing billing or draw, you will go back to the Estimate you created and look for an option that says “Create Invoice” – click on that button/option.
This opens a Create Progress Invoice Based on Estimate window, which provides you with 3 different options for creating your progress invoice:
- Create an invoice for the entire estimate (100%)
- Create an invoice for a percentage of the entire estimate (you then get to choose a percentage – 33%, 30%, etc.)
- Create invoice for selected items or for different percentages of each item.
Most construction contractors will choose the third option, to Create invoice for selected items or for different percentages of each item. After making your selection on how you want to create the progress invoice; click OK.
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This now opens a new window, Specify Invoice Amounts for Items on Estimate; where you will be able to see the various line items that are on your Estimate. You can specify the quantity, rate, amount or percentage for each item that you wish to bill for in the current period. As you enter amounts or percentages you will be able to see a running total for the current billing. When you are satisfied, click the OK button to have the information automatically populate the Progress Invoice form.
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If you didn’t enter an amount or a percentage for each line item on your Estimate, QuickBooks will display a message indicating that there are items with zero amounts.
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Most people will find this Zero Amount Items message to be very annoying; it can be turned off by checking the Do not display this message in the future and clicking Ok.
Following this procedure you have created your first basic progress invoice. When you Save it, you have automatically updated your Accounts Receivable, and can send it to your customer or General Contractor or you can use the information it contains to complete an special invoice format that is required.
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Progress Invoicing (also called progress billing, percentage of completion billing, or partial billing) involves billing from an estimate (or Schedule of Values) over the course of time and could be considered a type of installment billing. Progress billing is commonly associated with the construction industry; however, it is common in other industries as well.
QuickBooks® Pro, Premier, and Enterprise editions all offer several options for invoicing and a Progress Invoicing function is also available.
Some projects or jobs will require only a single invoice, others will require two invoices, others may require three invoices (one at the start of the job, one when you are 50% done, and the other when you are finished), other projects might require that you submit monthly progress invoices over the course of months or even years.
Typically, if you take on a job that you will have finished at the end of 30 days, you might only want to create a single invoice, unless retention or retainage is held for some reason, in which case you will have to create two invoices.
When your scope of work on the project will span one or more months, then you will want to consider progress billing. When you generate progress billings, you will bill ONLY for the work that you have completed and the materials that you have used or installed – occasionally you will also be allowed to bill for materials that you have at the jobsite but have not yet used.
If you are a subcontractor, sometimes the General Contractor will have a form that they insist you use (instead of your own invoice form), other times they may insist that you submit your progress billing on an industry standard billing form – such as the AIA G-702 & G-703 forms developed by the American Institute of Architects – or similar plain paper forms containing the same information.
Make sure that you submit your billings on the forms that they want or they will probably reject your invoice; mail it back to you and tell you to resubmit your billing CORRECTLY. Usually having to resubmit a bill means that you have to wait until next month to submit the corrected bill.
Always try to get your invoice paperwork right the first time and include any proper releases that are required. Sometimes the General Contractor will hold up everyone’s invoices —-even if only one contractor has submitted their billing incorrectly.
We’ve been testing, debugging, and documenting numerous certified payroll and AIA billing updates for the last few weeks – I’ve posted some of the information behind the changes here in our blog.
Today, I just send out a newsletter to over 2,000 construction companies (in all 50 states) who use our software – Glad I use Constant Contact to keep everyone up to date, otherwise they would get me for spamming 
Below are highlights from the newsletter.
Certified Payroll Solution Updates:
There are several new enhancements, changes, and requirements available for Certified Payroll Solution; some at the State level for certified payroll reporting and others at the Federal level for EEOC Reporting – each item has a link to our website where you will find complete instructions. Be sure to visit our website to obtain the instruction on how to download & install the updates and implement any new changes that you will need to make.
- California DIR established Compliance Monitoring Unit and requires electronic certified payroll reports via a Labor Compliance Program (LCP) developed by TRS Consultants, Inc. Click here for details.
- New FHWA 1391 & 1392 Annual EEO Reports for Federal Highway Contractors – the U.S. Department of Transportation Federal Highway Administration revised both the 1391 & 1392 in June 2010. The new forms print on LEGAL SIZE paper and require that you report employees who are of two or more races separately. Click here for details.
- Texas DOT Requires Electronic Certified Payrolls {E-Payrolls} – The Texas Department of Transportation, like many other state agencies, is requiring electronic submission of certified payroll reports, through its Electronic Project Records System (EPRS). We have worked closely with representatives of Texas DOT to ensure that CPS will create the required .CSV file. The electronic upload has been tested and approved by Texas DOT. Click here for details.
- Revised Mississippi CAD-880 & CAD-881 Forms – Mississippi Department of Transportation (DOT) has revised their CAD-880 & CAD-881 Forms and updated forms are available to download. The Certified Payroll Report now includes the Race & Gender of each employee. Click here for complete details.
- New York City Housing Department Form Update – The New York City Housing Department is requiring that ALL certified payroll reports submitted on the Federal WH-347 form include the”Public Burden Statement”. Click here for complete details.
- Wisconsin Bug Fixes – corrects DOT Statement of Compliance check boxes and Department of Workforce Development Electronic upload error. Download CPS Version 5.0.440 and then download Wisconsin DOL forms.
- More Missouri revisions – including the ability to print the certified payroll report forms on either standard or legal-sized paper. Download CPS Version 5.0.440 and then download new State of Missouri forms.
- Alaska Electronic Certified Payroll Upload News – Over a year ago we were contacted by the Alaska Department of Labor & Workforce Development to provide an electronic upload for their new on-line certified payroll filing. We worked closely with them to provide them with the correct information and upload type. A couple of weeks ago, we were contacted again and the system is now live. Download this brochure from the Alaska Department of Labor & Workforce Development, download this article for setting up CPS to generate the required files.
Construction Application for Payment Solution (AIA Billing Updates)
We’ve also been working on the Construction Application for Payment Solution (for AIA Billing). We’ve added new functionality and forms that have been requested by YOU, our customers. Each new item is listed below, if there are “special” instructions for implementing the new feature – be sure to click the link to visit our website and download ALL of the download & setup instructions that are available.
- Quantities on the Continuation Sheet – Currently this is a tested ALPHA release (Version 5.0.219), which provides Quantity Tracking (estimated, previous, current, stored, previously stored quantities and unit price can be tracked and printed with CAPS). New forms have been added with quantities. In some cases, prior form selection on jobs may be incorrect – check the Form Printing Options for each Job (Edit menu -> Jobs -> select Job -> Edit -> Printing tab -> check selection in the Select a plain paper form for this job. CAPS now provides 22 different plain paper invoicing formats for you to choose from.
- Contractor Qualification Statement – In April we released in BETA a Contractor Qualification Statement as part of the Construction Application for Payment Solution Program. Some, but not all of you have downloaded this update (Version 5.1.214) and it is currently in BETA until we hear more feedback from you.
- Plain Paper 706, 706A, 707 & 707A forms – In March, we released in BETA the ability to create complete 706, 706A, 707, & 707A forms using plain paper – rather than having to purchase AIA originals. Some, but not all of you have downloaded this update (Version 5.0.184) and it is currently still in BETA until we hear more feedback from you.
New FHWA-1391 & FHWA-1392 Federal-Aid Highway Construction Contractor’s Annual EEO Reports were released by the Federal Highway Administration (FHWA) in June 2010.
Purpose of Forms FHWA-1391 & FHWA 1392
The purpose of the Contractors Annual EEO Reports are to collect employment data (including a breakdown of all racial/ethnic minorities and women employed) from ALL highway construction contractors who are working on a Federal-Aid Contract of $10,000.00 or more during a specific “annual” reporting period.
Form FHWA-1391 is filed for individual jobs while form FHWA-1392 is a total of all jobs being submitted.
The information included on these forms provides valuable information that is used by both Federal and State Governments in evaluating the status and effectiveness of the Equal Employment Opportunity (EEO) Program. It is extremely important that accurate data is collected, and submitted, as the status and effectiveness of State and Contractor EEO Programs can directly affect the status of funding for Federal-Aid Highway Construction Projects.
How do the new FHWA – 1391 & 1392 forms differ from the old forms?
The new FHWA-1391 & 1392 forms are printed on legal sized paper and require that you report how many employees (by gender and work classification) belong to more than one race and the race classifications have changed slightly.
The OLD Form-1391 wanted the following information by Job Category/Work Classification:
The NEW Form FHWA-1391 requires the following information by Job Category/Work Classification:
General Instructions for completing Federal-Aid Highway Construction Contractor’s Annual EEO Report Form FHWA-1391
ALL prime contractors and subcontractors (no matter what tier), with a Federal-Aid Highway construction contract of $10,000.00 or more, must complete this report using company-wide highway construction employment data for ALL Federal-Aid Highway Construction Projects that were active during the reporting period. Prime contractors are NOT responsible for submitting subcontractor reports; however, they are responsible for ensuring all subcontractors are aware of EEO Contract Special requirements.
Include company officials and supervisors that are on the projects for a majority of the time even if they do not appear on certified payrolls.
Do not include any company personnel that may be on the Project on an occasional basis; but do not have daily, on-site responsibility for project activity.
Do not include any office personnel unless they are assigned exclusively to a project and appear on the project certified payroll. This primarily applies to clerical personnel.
Use only the most appropriate Job Category/Work Classification listed in Table A to report employees:
Table A contains the following list of 15 “parent” Job Categories/Work Classifications – these classifications can often be different than the specific Job Category/Work Classification that is printed on a certified payroll report:
- Officials
- Supervisors
- Foremen/Women
- Clerical
- Equipment Operators
- Mechanics
- Truck Drivers
- Ironworkers
- Carpenters
- Cement Masons
- Electricians
- Pipefitter/Plumbers
- Painters
- Laborers-Semi Skilled
- Laborers-Unskilled
For example, list flaggers as Laborers-Unskilled, operators of paint striping trucks are NOT painters, they are truck drivers or equipment operators, form builders and helpers are carpenters, form setters are Laborers-Semi Skilled, list survey crews as Laborers-Semi Skilled for lack of a better category. Do not alter any part of the report, cross out any pre-printed categories, write in different categories, or provide information not requested on the report.
When is the FHWA-1391 form due and what is the reporting period?
Historically, the 1391 has been due in mid-August reporting the month of July; however, during our recent research we have found both due dates and reporting periods to differ depending upon the state in which your business is located. Check with the Prime Contractor, the main DOT Office for your state, or the Project Owner for requirements for EACH of your current projects.
Other considerations:
Again, during our recent research we found that some state DOT memorandums published on the internet are referencing the newly revised form but showing examples of the old form. Be very careful and make sure that you know which form you need to submit (old or revised 6-2010). If you do not get a satisfactory answer – submit both forms.
Where do I find the forms?
New forms, for manual completion, may be obtained from the U.S. Department of Transportation – Federal Highway Administration website at http://www.fhwa.dot.gov/eforms/index.htm
Old forms, for manual completions, may be obtained from http://www.okladot.state.ok.us/dbeinfo/pdfs/pr-1391.pdf
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Author’s Note: Certified Payroll Solution, a QuickBooks integrated application, provides users with the ability to print 24 different Federal, State, and Local EEO/EEOC Reports; including BOTH the old and new versions of the FHWA-1391 & 1392. Look for the new forms to be released during the week of July 30, 2010.
The Texas Department of Transportation, like many other state agencies, is requiring electronic submission of certified payroll reports, through its Electronic Project Records System (EPRS).
TxDOT EPRS provides contractors with multiple functions which they can utilize; however, one of the primary functions of the EPRS is that of collecting Electronic Certified Payrolls (E-Payrolls), instead of requiring contractors to submit paper certified payroll report forms for review.
E-Payrolls may be uploaded into the EPRS from a contractor’s computer IF they have the proper information, in a specific data order, and it is a .CSV file format – otherwise the contractor will have to take his printed paper certified payroll report and manually input it in the EPRS System.
Some software companies are updating their payroll systems to provide their construction clients with the ability to create electronic output files, such as the .CSV file required by TxDOT, in addition to printing a standard paper report for the contractor to keep in his job file. However, the problem for the software companies is that there is no standard output file that is used consistently and each state or agency wants the electronic file to not only contain ALL of the information that is required on their “paper form” but include additional information as well.
For example:
- Texas Department of Transportation requires a .CSV file
- Elation Systems, Inc. requires an XML file
- TRS Consultants, Inc. requires an XML file
- LCPtracker requires an .XLS file
- Sandia National Laboratory requires an XML file
- Alaska Department of Labor & Workforce Development requires a .TXT file
- Wisconsin Department of Transportation requires an XML file
- Wisconsin Department of Workforce Development requires an .XLS file
Some computer savvy contractors create a “master” certified payroll reporting form (based on the requirements of the State agency that they must submit them to) in Excel, manually input the payroll data each week and attempt to “save” it in any of the above mentioned file formats listed above – only to discover that the file is rejected and they have to log and manually type the information into the Labor Compliance System.
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Certified Payroll Solution, a QuickBooks integrated application, will read your QuickBooks payroll data and generate paper forms and/or all of the required electronic upload formats noted above – included the format required by the Texas Department of Transportation .CSV format (this functionality will be released via a program update on 7/30/2010 and has been thoroughly tested by TxDOT).
Request a FREE 30-day trial to see for yourself.
