Understanding Progress Payment Amounts

Some government contracts may include progress payments as part of the contract's financing terms. Progress payments enable the contractor to receive payment prior to a regular bill being issued for item delivery (which may occur late in the contract period).

Progress payment requests are issued from the contractor to the government, as costs are incurred, using an approved progress payment rate percentage. Such requests can be issued regularly, based on a schedule, or progress of work.

Once the items in the contract are delivered, and a regular bill is issued, progress payment amounts are liquidated according to progress payment liquidation rates.

This section discusses:

• Progress payment business process flow.

• Progress payment statuses.

• Progress payment billing.

• Progress payment liquidation.

• Progress payment accounting.

• Progress payment processing.