CCA Construction Billing and Payment Verification 1

Question 1

A Schedule of Values (SOV) is primarily used in construction billing to:

Accepted Answer

Allocate the contract sum among work components for progress payment purposes

Answer

The SOV breaks the total contract price into line items corresponding to work components, forming the basis for calculating progress payment amounts.

Question 2

When auditing a contractor's pay application, which document is most critical for verifying that work-in-place percentages are accurate?

Accepted Answer

Field inspector's or owner's representative's progress report

Answer

Independent field verification by the owner's representative confirms actual work-in-place quantities against the contractor's claimed completion percentages.

Question 3

Overbilling on a construction project most commonly occurs when a contractor:

Accepted Answer

Bills for work not yet performed or materials not yet incorporated

Answer

Front-loading or billing for work or materials ahead of actual installation is the most prevalent form of overbilling in construction.

Question 4

What is the purpose of a stored materials provision in a construction contract's payment clause?

Accepted Answer

To allow payment for materials delivered to the site or approved off-site storage before installation

Answer

Stored materials provisions permit progress payments for materials that have been delivered and properly documented but not yet incorporated into the work.

Question 5

Which auditor procedure best detects duplicate billing of a single invoice across multiple pay applications?

Accepted Answer

Cross-referencing invoice numbers across all pay applications

Answer

Maintaining a log of invoice numbers and cross-checking them across all pay applications identifies instances where the same cost has been billed more than once.

(CCA) Certified Construction Auditor Practice Test

(CCA) Certified Construction Auditor Practice Test

CCA Construction Billing and Payment Verification 1