Advance Payments and Recoupment
The advance payment feature allows you to configure, create, and manage advance payments and their recoupment in construction projects. An advance payment is a partial payment made before work has started or goods have been delivered, usually to cover initial costs such as procurement of materials or equipment.
In this article:
- About Advance Payments
- Advance Payment Columns
- Add Advance Payment
- Progress Payments with Recoupment
- Payment Application Summary
- Related Articles
About Advance Payments
Advance payments help facilitate project cash flow management and reduce risks associated with upfront costs. The system provides comprehensive tracking of both advance payments and their recoupment through progress payments.
Advance Payment Columns
In Cost Management tables, there are several columns related to advance payments:
| Table | Column | Section |
|---|---|---|
| From Previous Application | Advance Payment | Amount |
| Recoupment | Amount | |
| This Period | Advance Payment | Amount % of Scheduled Value |
| Recoupment | Amount % of This Period Work Completed |
|
| This Application | Total Advance Payment | Amount % of Scheduled Value |
| Total Recoupment | Amount % of Total Advance Payment |
|
| Remaining | Unrecouped Advance Payment | Amount % of Total Advance Payment |
Add Advance Payment
To add an advance payment:
Open the Cost Payment Application.
To enable the Advance Payment-related columns, click the column gear button.
Now you have two options:
- Search for the Advance keyword in the column search area.
- Select Advance Payment Columns in the columns groups section.
Input the advance payment as either an amount or a percentage.
The system will automatically update the Total Advance Payment amount field in This Application column.
Progress Payments with Recoupment
Recoupment is a repayment of advance payment through deductions from progress payments. You can choose which payment items are applicable for recoupment.
To add recoupment amount or percentage:
- Open the Cost Payment Application.
- Navigate to the column labeled This Period and Recoupment within it.
- Input the recoupment as either an amount or a percentage.
- The system will automatically update the Total Recoupment amount field in This Application. The Total Recoupment is calculated as the sum of Previous Recoupment and This Period Recoupment.
When you create another payment application, it automatically inherits the recoupment percentage from the previous payment application, but does not inherit the recoupment amount.
Payment Application Summary
The Total Advance Payment and Total Recoupment amounts are included in the Payment Application Summary, which is visible in the flyout panel in the Cost Payment Application.
To show the Summary:
- Open the Cost Payment Application.
- Click the selected payment application.
- Flyout panel including Payment Application Summary pops up.
The summary includes:
- Total Earned - excludes retention and includes unrecouped advance payment
- Balance to Finish - includes retention but excludes unrecouped advance payment