RA bill (running-account bill)

In plain words

on a long construction job you do not wait for the end to be paid. Each month, or at each stage, the work done so far is measured, the client's engineer certifies it, and you bill for it. That interim bill is the RA bill.

A share is usually held back as retention, so the amount paid is less than the amount certified.

A worked example

Why it matters

• Cash. Monthly bills fund the site; waiting for the end would not.
• Cost. Certifying more than was done means overpaying a subcontractor or overbilling a client.
• Risk. Retention is cash you have earned but cannot touch yet.

How Kinnow handles it

Kinnow builds the bill from measured work.

• From the measurement book. When a measurement book is certified, the bill takes its certified amount. Retention comes from the project's retention rate. Approved variations are added only if you choose to include them.
• Both directions. A bill to your client and a subcontractor's bill to you work the same way, with opposite signs.
• A printable statement. The statement shows base work, variations, the certified total, retention, defect-liability retention and the amount payable now.
• Checked first. The RA-Bill Reviewer checks certified quantities against the measurement book and the contract, and holds the bill for review. It never posts it.
• In the accounts. The retention is carried as a separate receivable, so it does not look overdue in ageing. Cancelling a bill needs a written reason and reverses its entries.

The honest limit. The RA bill is not a tax invoice. Kinnow posts it as an accounting entry, and the tax invoice is a separate step.

In Kinnow

Related terms

• Retention money: the part held back.
• GST: the tax invoice that follows.
• IRN e-invoice: if the tax invoice must be registered.
• Approval workflow: who signs off a bill.

Questions