Engineering & Architecture Firms
Why Phased Billing Is Uniquely Easy to Miss Phased billing is structurally different from a recurring retainer. A retainer invoice goes out on a fixed calendar date whether or not anyone thinks about it. A phase completion trigger, schematic design wrapping up, design development being approved, construction documents going out for bid, is a judgment...
Why Project-Level Tracking Hides the Full Picture Architecture and engineering firms are organized around projects, and their financial tracking habits typically follow that same structure. Each project has its own budget, its own schedule, and often its own record of what has been billed and collected, sometimes in a project management tool, sometimes in a...
Standard Phase Structure AIA Document B101-2017, the standard form of agreement between owner and architect, divides an architect's basic services into five phases: schematic design, design development, construction documents, procurement, and construction, with construction administration covering the architect's role during the construction phase itself. This structure is the reference point most US architecture firms build...
Billed vs Incurred Cost, the Core Comparison This is the same underlying logic construction accounting uses to track overbilling and underbilling, adapted to a design or engineering engagement. Construction accounting guidance from Deltek lays out the standard method: calculate percentage of completion by dividing total costs incurred to date by the revised estimated total cost,...