Owner's Rep. - Pay Application Management Services
Owners of construction projects rely on ResX's payment processing services to ensure that the invoices submitted by a construction company are complete and accurate.
Families building high value homes and developers building large commercial properties (collectively referred to as "Owners") rely on ResX oversee and approve the contractor's monthly invoices ("Pay Applications' or "PA's").
Owners rely on ResX's Construction Pay App. Management Services because we have superior experience, knowledge, and technology. We will carefully scrutinize the contractor's PA more thoroughly and at less cost than if this work was performed by the Owner.
Owners that engage ResX to perform this service ensure that the contractor's Pay Applications are complete, devoid of overcharges, and maintained in permanent files along with all proper back-up documents and ledgers.
Our Construction Pay App. Management Service relieves the Owner of this high risk responsibility and provides the Owner with the assurance that the Pay App. it receives from a contractor are professionally reviewed, tested, tracked, and approved.
Our Pay App. Management Services gives Owners the ability establish immediate control over the payments it disburses to a construction contractor. We will minimize the Owner's risk of issuing payments against a contractor's PA that:
- Exceed the amount due
- Violate important requirements of the construction contract
Common problems identified by our Construction Pay App. Management Services:
- PA charges for costs that are not proven by accounting or field documentation
- PA includes cost documentation (e.g., labor or material) for work incurred on a project other than your project.
- PA understates the amount paid previously, therefore overstating the amount currently due.
- PA package does not include lien waivers.
- PA charges for required insurance coverage that the contractor never purchased.
- PA overstates the percent complete.
- PA charges for costs that are not billable such as excluded home-office costs.
- PA has math errors such as charging fee on pass-through expenses.
For a small set-up charge and a small charge per monthly PA, ResX will help the Owner avoid problems like the ones listed above by providing the following functions:
- Negotiate with the contractor to establish the procedures it is to follow when submitting a PA to the Owner.
- Monitor the contractor's compliance with the agreed upon PA submittal procedures, including required inclusions such as signatures, lien waivers (conditional and unconditional), status reports, change orders, and subcontracts forms.
- Test the accuracy of the calculations underlying the PA such as, fees, taxes, and insurance markups.
- Audit the underlying support for costs included in the contractor's PA, including field documentation, payroll records, supplier invoices, and subcontractor invoices.
- Report to the Owner the results of our PA review and recommend the amount approved for payment.
- Maintain the files and ledgers needed to memorialize the contractors PA submittals, the results of our review and tests, and the payments subsequently issued by the Owner.
- Conduct a close-out audit of the contractor's PA's and recommend the final payment amount.
Our Pay App. Management Services can also be implemented after the project is started. This frequently occurs when the Owner loses trust in the contractor or when the Owner realizes that it does not have the administrative expertise in-house to effectively manage PA processing.
Additionally, the scope of our Pay App. Management Services can be expanded beyond the contractor's PA to include invoices received from other providers that the Owner contracts with directly, such as architects, engineers, interior decorators, or landscapers.