For contractors in fire protection, HVAC, MEP, interiors and civil work, cash flow depends on one document: the running account bill. Billing late, billing wrong, or forgetting a variation directly delays payment. Here is how BOQ-based billing works, and how ERP software takes the manual work out of it.
The bill of quantities (BOQ)
A BOQ lists every item of work in the contract: a description, the unit (for example metre, number or square metre), the quantity and the rate. Multiplying quantity by rate gives the value of each line, and the sum is the contract value.
The BOQ does three jobs:
- it is the basis of your quotation;
- once accepted, it becomes the contract you measure against;
- it is the reference for every bill you raise.
That is why, in good contractor software, the BOQ is frozen when the client accepts it. Later changes go through variations, never through silent edits.
Measurement and certification
As work progresses, quantities completed are measured on site, for example running metres of pipe installed or the number of sprinklers fitted, and the client's engineer or consultant certifies them. Certification is what turns work done into work you can bill.
The running account (RA) bill
An RA bill is an interim bill for certified work. RA bills are cumulative. For each BOQ line they show:
| Column | Meaning |
|---|---|
| Contract quantity | from the BOQ |
| Up to previous bill | quantity certified and billed before |
| This bill | quantity certified since the last bill |
| Cumulative to date | previous plus this bill |
| Amount this bill | this-bill quantity × rate |
The bill then applies the agreed terms, for example retention, advance recovery, and taxes, to arrive at the amount payable.
Because each bill builds on the last, one mistake carries forward. That is where spreadsheets hurt most.
Variations
Real projects change. The client adds outlets, a route is redesigned, quantities grow. These variations should be:
- recorded separately from the original BOQ, with a reference;
- priced (at BOQ rates or new agreed rates);
- approved by the client;
- then certified and billed through the RA bills like any other line.
Unrecorded variations are one of the most common reasons contractors finish a project with less money than expected.
Where spreadsheets go wrong
- Quantities copied from the previous bill by hand, and copied wrong.
- Rates changed in one sheet and not another.
- Variations sitting in emails, never billed.
- No link between billing and cost, so nobody knows the project margin until the end.
How ERP software handles it
In ERP built for contractors:
- The quotation is built from BOQ lines and becomes the contract on acceptance.
- Certification is recorded against each BOQ line, by date.
- The system calculates previous, current and cumulative quantities automatically and produces the RA bill in your format.
- Variations have their own approval route and flow into billing once certified.
- Because purchases and expenses are booked to the same project, you see billing against cost at any time, not just at project close.
This is how CROVO-ERP works: the BOQ is the backbone for quotation, certification and RA billing, with project budgets and spend alerts alongside. Book a free CROVO-ERP demo to see an RA bill generated from certified work.
Frequently asked questions
What is an RA bill?
An RA (running account) bill is an interim bill a contractor raises during a project for work completed and certified so far. Each RA bill is cumulative: it shows the total work done to date, subtracts what was billed earlier, and claims the difference.
What is a BOQ in construction?
A bill of quantities (BOQ) lists every item of work in a contract with its description, unit, quantity and rate. It is the basis for the quotation, for measuring work done and for billing.
How are variations billed?
Variations are changes to the contracted scope: extra items, changed quantities or new rates. They should be recorded and approved separately from the original BOQ, and then billed through the RA bills once certified.
Can ERP software generate RA bills automatically?
Yes. When work certification is recorded against BOQ lines in the ERP, it can calculate the cumulative quantity, previous billing and current claim for each line and produce the RA bill. CROVO-ERP uses the BOQ as the backbone for quotations, certification and RA billing.