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Procore (en-GB)

Create an Owner Payment Application

Objective

To create a payment application for work completed, which can then be emailed to the owner. 

Background

An owner payment application is an itemized record of a financial transaction between a project owner and a company responsible for completing work. Typically, it is issued by a main contractor and submitted to a project owner to signal that a payment is due for completed work. 

Things to Consider

  • Required User Permissions:
    • To create a payment application, 'Admin' permission on the Main Contracts tool.
    • To view a main contract that has NOT been marked as 'Private', 'Read-Only' or 'Standard' permission on the project's Main Contracts tool. 
    • To view a main contract marked 'Private', 'Read-Only' or 'Standard' permission on the project's Main Contracts tool and you must be added as member of the Private list on the main contract. See Create Main Contracts
    • To view the Detail tab on a payment application, 'Read Only' or 'Standard' permissions on the project's Main Contracts tool with the 'View Owner Payment Application Detail' granular permission enabled on your permission template
  • Additional Information:
    • When you enter a value for a payment application that is larger than the scheduled value, the payment application will be highlighted in red.
    • You can only edit the billed amounts on the most recent payment application.
  • In order to copy Subcontractor Payment Applications and Direct Cost amounts from the Commitment Billing Period to the payment application the following things must be true:
    • For Direct Cost amounts to be carried over:
      • Direct Cost amounts must have a status of 'Approved.'
      • The Direct Cost "Received Date" must fall within the Commitment Billing Period Start and End dates.
      • Only Direct Costs from Procore's Direct Costs tool will copy. ERP Direct Costs will not copy.
    • For Subcontractor Payment Application amounts to copy over:
      • The Subcontractor payment application must exist in the selected Commitment Billing Period.
      • Subcontractor payment applications must have a status of 'Approved', 'Approved as Noted', and 'Pending Owner Approval".
      • The payment application should have one line item with either the cost code and cost type that matches the Payment Application and/or Direct Cost line item or the Division as the cost code that the Payment Application and/or Direct Cost line item cost code is tiered under. For example, if the payment application line item is 03-300 and the Payment Application is line item Division 03, the 03-300 amount will copy to the Division 03 line item.
        • If the Payment Application has multiple line items with the same cost code and cost type, Procore will duplicate the payment application and/or direct cost line item amount onto both Payment Application lines, doubling the amount on the Payment Application.
      • If you choose to compile your subcontractor payment applications backup (See Compile Subcontractor Payment Application Backup), the compiled backup will be attached to your payment application. The compiled payment application backup will also include the DocuSign© version of the PDFs if DocuSign© is being used. 
      • Once the Payment Application is created, there is currently no option to copy Subcontractor Payment Applications or Direct Costs at a later time for that same Payment Application (other than manually entering in the amounts).
    • For both to copy over: 
      • Once the Payment Application is created, there is currently no option to copy Subcontractor Payment Applications or Direct Costs at a later time for that same Payment Application (other than manually entering in the amounts).
      • Both subcontractor payment applications and direct costs amounts will copy only if they are revised in the Payment Application and Direct Cost after they are copied into the Payment Application, the Payment Application will not update with the revised amounts.
      • If a commitment accounting method is Unit/Quantity Based, only the "value" will copy over. Quantity will not be reflected in the owner payment application. See How do I set the accounting method for a commitment or main contract?
  • Commitment Variation billed amounts will prefill from the subcontractor payment applications to the main contract payment application if the line items have the following:
    • The MCV and its corresponding CV must be on the same line item as the change event that the items were created for (projects must have change events enabled).
    • Line items have variations broken down by line item.
    • Any project created on or after March 29, 2018 has the variations broken down by line item functionality enabled.

Prerequisites

Steps

  1. Navigate to the project's Main Contracts tool.
  2. Locate the main contract that you want to create the payment application for. 
  3. Click Edit
  4. Click Create Payment Application.
  5. Do the following:
    • Commitment Billing Period
      Select the commitment billing period. See Create Automatic Billing Periods or Edit a Billing Period For Payment Applications.
    • Payment Application #
      Enter a unique identifier for the payment application.
      Notes:
      • Procore automatically numbers payment applications in ascending numerical order, starting with one (1). 
      • The number entered in this field does NOT affect Procore's default payment application numbering scheme.  
    • Period Start
      Select a start date you are creating the payment application for.
    • Period End
      Select an end date you are creating the payment application for.
    • Billing Date
      Select the date you are submitting the payment application.
    • Status
      Select one of the following statuses: Draft, Under Review, Revise and Resubmit, or Approved.
      • Draft. Use this status while creating the payment application.
      • Under Review. Apply this status while the payment application is being reviewed. 
      • Revise and Resubmit. Apply this status when the payment application needs to be corrected. 
      • Approved. Apply this status when the payment application has been approved. 
    • Percent Complete
      Shows the percentage of work completed.
    • Attachments
      If Step 4 below is confirmed, the Payment Application PDFs and any Payment Application and Direct Cost PDF attachments from the selected commitment billing period will combine into a single PDF, which you will see here. 
  6. Click Create.
    Notes:
    • You will be prompted to confirm that you want the payment application to pre-populate with amounts billed per division or cost code from our commitment payment application work complete and materials presently stored columns and direct costs.
    • If confirmed, this pulls in Payment Applications and direct costs amounts for the selected commitment billing period, as well as adds attachments as referenced above. 
    • For amounts to be pulled in correctly, the cost code and cost type on Payment Application and Direct Cost line items must match that of the main contract's divisions or cost code lines. 
  7. Scroll down the page to view a preview of the payment application form under "Summary Preview." To learn how the 'Current Amount Due' amount is calculated, see How does Procore calculate the 'Current Payment Due' amount on a payment application?

Edit Line Items

  1. Click Detail.
    Note: Users with 'Read Only' or 'Standard' permission on the Main Contracts tool can only view the Detail tab only if the 'View Owner Payment Application Detail' granular permission is enabled on their permission template.
  2. Click Edit.
  3. Complete the following:
    • Work Completed (This Period)
      Payment Application amounts (From Work Completed (This Period) in Reqs) and Direct Costs amounts will be copied here if you confirmed the pre-fill option in Step 4 above.
    • Materials Presently Stored
      Payment Application amounts (from Materials Presently Stored in Payment Application) will be copied here if you confirmed the pre-fill option in Step 4 above. 
    • Work Retention Retained this Period
      Enter a percentage or monetary amount for work retention retained this period. You can also set retention on all line items by entering a value into the right sidebar and clicking Set.
    • Materials Retention Retained this Period
      Enter a percentage or monetary amount for materials retention retained this period. You can also set retention on all line items by entering a value into the right sidebar and clicking Set
    • Work Retention $ Released This Period
      Enter a monetary amount of work retention released this period.
  4. (Optional) If you have any approved contract variations, you can choose to add them to the payment application by scrolling to the bottom of the page and clicking Add to Payment Application
    The entry and editing of the variations will always occur at the line item level of detail. You can select a different level of detail for how variations will be displayed on the detail page of the Payment Application when being viewed or exported from Procore. See Edit the Advanced Settings Tab for a Main Contract.
    No payment application values will copy to the variations.
  5. Click Save.
    All changes will be reflected Contract Summary Report in the General tab.

See Also