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Allow or Prevent Overbilling on a Subcontractor Payment application

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Objective

To configure the project's Commitments tool to allow or prevent overbilling on a subcontractor payment application.

Background

Overbilling occurs when a line item on a subcontractor payment application exceeds the contract amount in an agreement. When overbilling is overlooked in Procore, it negatively impacts your project's overall budget, since you are being charged an amount that is higher than what was agreed upon. By default, the project's Commitments tool is configured to allow overbilling on a project. However, you can enable a feature that checks your payment applications for overbilling and notifies you when a line item is overbilled. 

To prevent overbilling in subcontractor payment applications, there are two (2) options:

  • Turn the 'Allow Over Billing 'feature OFF. This action prevents users from saving a payment application if any of the payment application's line items exceed 100% of the budgeted amount in the commitment. To turn this setting OFF, see the Steps below. 
  • Turn the 'Prevent Overbilling on All Projects' setting ON. Your company's Procore Administrator turns this setting ON in the Company level Admin tool. This setting allows users to save a payment application when a payment application's line items exceed 100% of the budgeted amount in the commitment on all of your company's projects. To learn more about this setting, see Set the Defaults for Your Projects.

Things to Consider

  • Required User Permissions:
    • 'Admin' level permissions on the project's Commitments tool. 

Steps

  1. Configure the 'Allow Subcontractors to Over-Bill' Setting
  2. Update an Amount to Over-Bill a BOQ Line Item

Configure the 'Allow Subcontractors to Over-Bill' Setting

  1. Navigate to the project's Commitments tool.
  2. Click the Configure Settings icons-settings-gear.png icon.
  3. Click the Payment application Settings link.
  4. In the Settings page, scroll to the Other section.
  5. Move the toggle to the left or right: 
    • To prevent over-billing, move the Allow Subcontractors to Over-Bill toggle to the left so the toggle is GREY. This is the default setting.
      OR
    • To allow over-billing, move the Allow Subcontractors to Over-Bill toggle to the right so the toggle is BLUE as pictured below.
      invoicing-settings-allow-over-bill.png
       Note
      If your company's Procore Administrator has turned the 'Prevent Overbilling on All Projects' setting ON in the Company Admin tool, you cannot change this setting. 
  6. Click Update.

Update an Amount to Over-Bill a BOQ Line Item

When the 'Allow Subcontractors to Over-Bill' setting is turned ON, Procore alerts you when line item entries exceed 100% of the budgeted amount in the commitment. 

  1. Navigate to the project's Commitments tool. 
  2. Locate the commitment in the Contracts tab. 
  3. Click the Number link to open it. 
  4. Click the Edit Contract button. 
  5. Scroll to the Bill of Quantities card. 
  6. Locate the line item to update. 
  7. Enter an amount that is in excess of the budgeted amount in the commitment.
    Example

    In this example, we updated five line items with values that exceed 100% of the budgeted amount in the commitment. 

    sub-invoice-sov-exceeds-budget.png

  8. Click Save. 
    • LEGACY If you are using the legacy subcontractor invoice experience, an 'Invalid Line Items' message appears to alert you that the amount you entered exceeds 100% of the budgeted amount in the commitment. Click Continue, then adjust the line items so they are no longer in excess of 100%. 
      invalid-line-items.png
    • BETA If you are using the beta subcontractor invoice experience, a 'We Couldn't Save Your Changes' message appears. The message lists all of the line items where you entry exceeds 100% of the budgeted amount in the commitment. Adjust the amount so that the line item is no longer in excess of 100%.
      we-couldnt-save-your-changes.png