Back to V310: Construction Project Management

Lesson 6: Tracking Compliance and Lien Waivers

In this lesson, you will learn about the processing of compliance documents in the system. Also, you will learn how to automate the generation of lien waivers for your construction projects.

Compliance Documents: General Information

Companies that manage construction projects have requirements to protect their customers, vendors, suppliers, and partners from potential issues associated with compliance. These compliance issues might be associated with federal, state, and local governmental requirements, but may also be legal and procedural. By tracking compliance, a company can establish the compliance documents that should be captured for diﬀerent types of entities, so that this information can be used for in-place warnings to users and for reports on project exposure.

Learning Objectives

In this lesson, you will learn how to do the following:

Configure categories and statuses for compliance documents
Enter compliance documents for a vendor
Track expired compliance documents

Applicable Scenarios

You apply a compliance document to an entity in the system when it is necessary to warn users about potential issues associated with compliance.

Creation of Compliance Types

You can use compliance types—that is, types of compliance documents—for tracking and reporting on compliance issues. The following compliance types are predefined on the Custom Attributes tab of the Compliance Preferences (CL301000) form:

Certificate
Insurance
Lien Waiver
Notice
Status
Other You define the values of the custom attributes for any of the listed compliance types on the Compliance Preferences form. On the Common Attributes tab of the form, you can also configure common attributes that are available for all types of compliance documents. Once attribute values have been configured for a compliance type, you can enter and view compliance documents of that type on the Compliance Management (CL401000) form.

Creation of Compliance Documents

Each compliance document can be associated with various types of documents and with multiple entities, such as project, project task, cost code, vendor, and customer. You add compliance documents manually in the following ways:

By adding a row on the Compliance tab of the respective form, and specifying the type of the compliance document in the Document Category column. Then you specify other compliance settings in the row, Lesson 6: Tracking Compliance and Lien Waivers | 39
```
    such as the project, the eﬀective and expiration dates, and the corresponding documents. You can add the
    compliance documents on the following forms:
```
Vendors (AP303000)
Bills and Adjustments (AP301000)
Checks and Payments (AP302000)
Customers (AR303000)
Invoices and Memos (AR301000)
Projects (PM301000)
Project Tasks (PM302000)
Project Transactions (PM304000)
Purchase Orders (PM301000)
Change Orders (PM308000)
Subcontracts (SC301000)
By creating a compliance document directly on the Compliance Management (CL401000) form. On this form, you add a row to the table, and specify the type of the compliance document in the Document Category column. Aer you save your changes, the compliance document will also be shown on the Compliance tab for each of the related documents or records. For compliance documents with the Insurance document type, the system prevents you from creating duplicated documents. You can add multiple insurance documents with the same policy if any of the following values diﬀers in these documents: document category, vendor, project, eﬀective date, expiration date, and limit.
```
        For information about manual creation of lien waivers, see Lien Waivers: Manual Creation of Lien
        Waivers.
```
On the Compliance tab of each of the forms listed above, you can review the compliance documents associated with the document or entity. Based on the entered information, the system warns users of any records with compliance issues. For example, if a compliance document is overdue for a particular bill, the system displays a warning message on the Bills and Adjustments form.

Compliance Documents: To Configure Attributes for Compliance Documents

This activity will walk you through the process of specifying custom attributes for compliance documents.

Story

Suppose that the ToadGreen company needs to keep track of the insurance documents and certificates in the system. Acting as a ToadGreen system administrator, you need to specify the values for the custom attributes of the Insurance, Certificate, and Status compliance type, so that users can specify their values for the compliance documents.

Configuration Overview

For the purposes of this activity, the Construction feature has been enabled in the Projects group of features on the Enable/Disable Features (CS100000) form.

Process Overview

You will specify the values for the custom attributes on the Compliance Preferences (CL301000) form. Lesson 6: Tracking Compliance and Lien Waivers | 40

System Preparation

Step: Configuring Document Categories and Statuses To perform configuration, do the following:

Open the Compliance Preferences (CL301000) form.
On the Custom Attributes tab, in the Attribute box, select Insurance to specify the possible types for the insurance documents.
In the table, add five rows (by clicking Add Row on the table toolbar for each), and specify the following values in the Value column of each row:

General Liability Coverage
Worker's Compensation Insurance
Commercial Automotive Insurance
Surety Bonds
Asset Protection

In the Attribute box, select Certificate to specify the possible types for the certificate documents.
In the table, add five rows, and specify the following values in the Value column of each row:

Safety Certification
Hazardous Materials Certification
Occupational Safety and Health Administration (OHSA)
Project Management Institute (PMI)
Leadership in Energy & Environmental Design (LEED)

In the Attribute box, select Status to specify the possible statuses for all compliance documents.
In the table, add two rows, and specify the following values in the Value column of each row:

Valid
Expired

Save your changes.
You have configured the types of compliance documents and defined the applicable statuses for them.

Compliance Documents: To Track Compliance Documents for a Vendor

This activity will walk you through the process of working with compliance documents.

Story

Suppose that the Standard Hardware Company vendor has provided the ToadGreen company with its OSHA certificate and its general liability insurance. Acting as a construction project manager, you need to enter this information in the system.

Configuration Overview

In the U100 dataset, the following tasks have been performed to support this activity: Lesson 6: Tracking Compliance and Lien Waivers | 41

On the Enable/Disable Features (CS100000) form, the Construction feature has been enabled.
On the Vendors (AP303000) form, the HARDCO - Standard Hardware Company vendor has been added.

Process Overview

You will add compliance documents on the Compliance Management (CL401000) form. You will then review the documents of a particular vendor on the Vendors (AP303000) form.

System Preparation

To prepare to perform the instructions of this activity, do the following:

Sign in as a construction project manager by using the ewatson username and the 123 password.
In the info area, in the upper-right corner of the top pane of the Acumatica ERP screen, make sure that the business date in your system is set to 1/30/2025. If a diﬀerent date is displayed, click the Business Date menu button and select 1/30/2025 on the calendar. For simplicity, in this activity, you will create and process all documents in the system on this business date.

Step 1: Entering Compliance Documents To enter the OSHA certificate and general liability insurance documents, do the following:

Open the Compliance Management (CL401000) form.
On the All Records tab, click Add Row on the table toolbar, and specify the following settings in the added row:

Document Type: Certificate
Creation Date: 1/30/2025
Document Category: Occupational Safety and Health Administration (OHSA)
Status: Valid
Required: Selected
Received from Vendor: Selected
Eﬀective Date: 1/1/2025
Expiration Date: 1/31/2025
Vendor: HARDCO
Certificate Number: 235568

Save the changes.
Again click Add Row on the table toolbar, and specify the following settings in the added row:

Document Type: Insurance
Creation Date: 1/30/2025
Document Category: General Liability Coverage
Status: Valid
Required: Selected
Received from Vendor: Selected
Eﬀective Date: 1/1/2025
Expiration Date: 1/31/2025
Limit: 10,000,000
Vendor: HARDCO
Insurance Company: Insurance of NY Lesson 6: Tracking Compliance and Lien Waivers | 42
Policy: 865532

Save the changes.

Step 2: Tracking the Compliance Documents To track the compliance documents for the vendor, do the following:

Open the Vendors (AP303000) form.
Select the HARDCO vendor, and make sure the compliance documents are shown on the Compliance tab.
In the info area, in the upper-right corner of the top pane, change the business date to 2/1/2025. On the Compliance tab, review the compliance expiration warnings for each line. Because you have specified the expiration date of the compliance documents as the last day of the current month, the system now marks those documents as expired.
Open the Bills and Adjustments (AP301000) form.
On the form toolbar, click Add New Record, and in the Summary area, specify the following settings:

Type: Bill
Vendor: HARDCO As soon as you select the HARDCO vendor, a warning about the expired compliance document appears next to the Vendor box.

Close the form without saving your changes to the bill, which was created solely for testing purposes.
You have added compliance documents for the vendor and verified that the compliance is tracked.

Lien Waivers: General Information

A lien waiver is a compliance document involved in the payment process for a project. The party that receives a payment (for instance, a contractor, subcontractor, or supplier of materials) signs a lien waiver to waive their rights against the property in exchange for the payment. You can set up lien waivers for a vendor class, vendor, and project to be generated conditionally or unconditionally.

Learning Objectives

In this lesson, you will learn how to do the following:

Configure the automatic generation of conditional lien waivers
Configure the automatic generation of unconditional lien waivers
Specify actions to be performed for outstanding lien waivers
Manually add a lien waiver for a document
Mark a lien waiver as the final one
Print and email lien waivers

Applicable Scenarios

In construction projects, lien waivers are issued to reflect that a subcontractor is waiving lien rights for a specific amount in exchange for the received payment or the promise of payment. Lesson 6: Tracking Compliance and Lien Waivers | 43

Configuration of Lien Waivers for Vendors

You can set up the automatic generation of lien waivers in the system for conditional or unconditional lien waivers. You also can manually create lien waivers and edit them (including those generated automatically). For each particular project, you specify the list of vendor classes for which the lien waivers should be generated by specifying the applicable vendor classes on the Lien Waiver Settings tab of the Projects (PM301000) form. For each vendor class, you can specify a minimum commitment amount so that lien waivers are automatically generated for each project commitment whose amount is larger than or the same as the specified minimum amount. If the minimum commitment amount is set to 0, the system will generate lien waivers for commitments of any amount. The system automatically generates lien waivers for the vendors that belong to the vendor classes that have the Generate Lien Waivers Based on Project Settings check box selected on the General tab of the Vendor Classes (AP201000) form. When you create a new vendor of the class, the system automatically selects the Generate Lien Waivers Based on Project Settings check box on the General tab of the Vendors (AP303000) form to indicate that the system will create lien waivers for this vendor automatically if the project for which you are entering a payment includes this vendor class. You can clear this check box to exclude a particular vendor of the vendor class from the lien waiver generation process.

Mailing Settings for Lien Waivers

You define mailing settings for each vendor to automatically send lien waivers of a specific type by email and to print the lien waivers. You configure separate mailings for each lien waiver category (that is, conditional partial, conditional final, unconditional partial, and unconditional final). When you create a new vendor on the Vendors (AP303000) form, the system populates its mailing settings with the mailing settings of the vendor class on the Mailing & Printing tab of the Vendor Classes (AP201000) form. You can override these settings in the vendor record on the Mailing & Printing tab of the Vendors form. When you print or email a lien waiver on the Print/Email Lien Waivers (CL502000) form, the system uses the report specified for the corresponding mailing in the vendor record. If the vendor has no active mailing for a lien waiver of a particular type, the system will use the mailing that is defined in the vendor class of this vendor.

Outstanding Lien Waivers

An outstanding lien waiver is a lien waiver that has not been marked as received and whose Through Date on the Compliance Management (CL401000) form is earlier than the current business date in the system. You configure the notification about outstanding lien waivers that exist for AP documents being processed on the Compliance Preferences (CL301000) form. The system searches for outstanding lien waivers through all compliance documents related to the particular primary and joint vendors.

Conditional Partial Lien Waivers

Conditional lien waivers should be issued when a progress payment on a project is expected. A signed lien waiver of this type becomes eﬀective immediately aer the payment has been prepared. The automatic generation of conditional lien waivers is set up in the system when the Automatically Generate Lien Waivers check box is selected in the Conditional Lien Waivers section of the Compliance Preferences (CL301000) form. In this case, the system will generate conditional partial lien waivers when an AP bill is paid—that is, when the status of the corresponding payment is changed to Pending Printing or Balanced. Also, you can select the Generate for AP Documents Not Linked to Commitments check box if you need to automatically generate lien waivers for payments that are related to a project but are not linked to project commitments. A payment created on the Checks and Payments (AP302000) or Prepare Payments (AP503000) form may include multiple bills related to diﬀerent projects, project tasks, and commitments. The system groups the payment amounts to each lien waiver and generates conditional lien waivers based on the option selected in the Calculate Lesson 6: Tracking Compliance and Lien Waivers | 44

Amount By box in the Conditional Lien Waivers section on the Lien Waiver Settings tab of the Compliance Preferences form.

You also can manually create conditional lien waivers for particular documents. For more information, see Lien Waivers: Manual Creation of Lien Waivers.

Unconditional Partial Lien Waivers

Unconditional lien waivers should be issued when a progress payment on the project is expected. A lien waiver of this type becomes eﬀective aer it has been signed, regardless of whether the payment has actually been received. The automatic generation of unconditional lien waivers is set up in the system when the Automatically Generate Lien Waivers check box is selected in the Unconditional Lien Waivers section of the Compliance Preferences (CL301000) form. In this case, the system will generate unconditional partial lien waivers when an AP bill is paid —that is, when the status of the corresponding payment is changed to Pending Printing or Balanced. Also, you can select the Generate for AP Documents Not Linked to Commitments check box if you need to automatically generate lien waivers for payments that are related to a project but are not linked to project commitments. A payment created on the Checks and Payments (AP302000) or Prepare Payments (AP503000) form may include multiple bills related to diﬀerent projects, project tasks, and commitments. The system groups the payment amounts to each lien waiver and generates unconditional lien waivers based on the option selected in the Calculate Amount By box in the Unconditional Lien Waivers section on the Lien Waiver Settings tab of the Compliance Preferences form.

You also can manually create unconditional lien waivers for particular documents. For more information, see Lien Waivers: Manual Creation of Lien Waivers.

Final Lien Waivers

          The system does not generate final lien waivers automatically.

By default, the system generates each conditional or unconditional lien waiver as a partial one. That is, this lien waiver is considered to be exchanged for a progress payment. If a payment being received is the last payment for a job tracked by a lien waiver, you need to mark the corresponding lien waiver as the final one. To mark a particular lien waiver or multiple line waivers as the final ones, you select the unlabeled check box in the needed rows on the Compliance Management (CL401000) form and click the Set as Final button. The system verifies that the selected lien waivers can be marked as final; that is, it ensures that no other final lien waiver exists for the group of lien waivers. Then the system changes the lien waiver type in the Document Category column as follows:

Conditional Partial to Conditional Final

Unconditional Partial to Unconditional Final

        You can also open a payment on the Checks and Payments (AP302000) form and on the Compliance
        tab, click the line with the lien waiver to be marked as final. Then you click Set as Final on the table
        toolbar.

You can also mass-process final lien waivers on the Print/Email Lien Waivers (CL502000) form. For more information, see Lien Waivers: Mass Processing.

Lien Waivers for Joint Payments

For a joint payee bill, the system creates a payment for the main vendor (that is, the vendor that is working directly with you on the project) and separate payments for the joint payees. The system automatically generates lien waivers for all these payments by using the general rules of lien waiver generation. For more information on processing joint payments, see Joint Payments: General Information. Lesson 6: Tracking Compliance and Lien Waivers | 45

           If the primary vendor specified in an accounts payable check has an outstanding lien waiver, the
           payment for the joint payee will be prohibited from processing as well.

Lien Waivers: To Configure Automatic Generation of Lien Waivers

This activity will walk you through the process of configuring the mailing and generation of lien waivers.

Story

Suppose that the ToadGreen company requires conditional lien waivers to be automatically generated when payments of an amount greater than $2000 are submitted. Acting as a system administrator, you need to configure the mailing and automatic generation of lien waivers. Then you need to configure the automatic generation of lien waivers for a particular vendor.

Configuration Overview

In the U100 dataset, the following tasks have been performed to support this activity:

The Construction and Construction Project Management features have been enabled on the Enable/Disable Features (CS100000) form.
On the Vendor Classes (AP201000) form, the SUBCON vendor class has been created.
On the Projects (PM301000) form, the HOTEL project has been defined.

Process Overview

You will create a notification template to be used for sending lien waivers on the Email Templates (SM204003) form. Then you will configure mailing settings that will use this template for a particular vendor class on the Vendor Classes (AP201000) form. You will enable generation of conditional lien waivers on the Compliance Preferences (CL301000) form. Finally, you will create a new vendor for which the system will send lien waivers automatically based on the specified conditions.

System Preparation

Step 1: Configuring the Mailing of Lien Waivers The processing of lien waivers includes the emailing of the documents to vendors who should return signed versions of them. In this step, you will perform the needed configuration of this mailing so that the system can generate emails with lien waivers attached. To configure the mailing, do the following:

Create a notification template for lien waivers as follows: a. Open the Email Templates (SM204003) form. b. Click Add New Record on the form toolbar, and specify the following settings in the Summary area:

Description: Lien Waivers
Screen: Print/Email Lien Waivers (CL502000)
Subject: Lien waiver c. In the text editor area on the Message tab, enter the following text: Lesson 6: Tracking Compliance and Lien Waivers | 46
```
       Dear Vendor,
       Your lien waiver is attached. Please return a signed version of the
       document.
       Sincerely yours,
       ToadGreen Building Group
    d. Save your changes.
```

On the Vendor Classes (AP201000) form, open the SUBCON vendor class.
On the Mailing & Printing tab, do the following: a. In the row with the Conditional Final mailing in the Mailings table, select Lien Waivers in the Email Template column. Make sure that the Active check box is selected and that CL.64.20.03 is specified in the Report box in the row. b. In the Recipients table, add a new row, and select Remittance in the Contact Type column. Make sure that the Active check box is selected in the row. c. In the row with the Conditional Partial mailing in the Mailings table, select Lien Waivers in the Email Template column. Make sure that the Active check box is selected and that CL.64.20.01 is specified in the Report column in the row. d. In the Recipients table, add a new row, and select Remittance in the Contact Type box. Make sure that the Active check box is selected in the row. e. Save your changes. When generating emails with lien waivers, the system will insert the email address of the remittance contact of the vendor as the recipient address. Emails will be sent from the default system email account.

Step 2: Configuring the Automatic Generation of Conditional Lien Waivers for a Vendor To configure lien waivers for a vendor, do the following:

On the Lien Waiver Settings tab of the Compliance Preferences (CL301000) form, do the following: a. Select the Automatically Generate Lien Waivers check box in the Conditional Lien Waivers section. b. Review the default settings, and click Save on the form toolbar.
Open the HOTEL project on the Projects (PM301000) form.
In the Conditional Lien Waivers section on the Lien Waiver Settings tab, make sure Posting Period End Date is specified in the Through Date box.
In the table, add a new row, and specify the following settings in the added row:

Vendor Class: SUBCON This indicates that conditional lien waivers can be automatically generated for vendors that belong to this vendor class.
Minimum Commitment Amount: 2000 Lien waivers will be automatically generated for commitments whose amount is greater than or equal to this amount.

Save your changes.
Open the SUBCON vendor class on the Vendor Classes (AP201000) form.
On the General tab, select the Generate Lien Waivers Based on Project Settings check box to indicate that lien waivers will be automatically generated for vendors that belong to this vendor class. The lien waiver settings specified for the particular project will be used for generating the lien waivers.
Save your changes.
Open the Vendors (AP303000) form, Lesson 6: Tracking Compliance and Lien Waivers | 47
```
 10.Click Add New Record on the form toolbar, and specify the following settings in the Summary area:
```

Vendor ID: ARCHCO
Vendor Class: SUBCON 11.On the General tab, enter Architectural Design Company in the Account Name box. 12.In the Primary Contact section, specify the following settings:
First Name: Evelyn
Last Name: Stewart
Email: eve.stewart@arc.example.com 13.On the Financial tab, make sure that the Generate Lien Waivers Based on Project Settings check box is selected. 14.On the Payment tab, select the Override check box in the Remit-To Info section, and type eve.stewart@arc.example.com in the Email box. 15.Save the changes.
You have configured lien waivers and created a vendor for which the system will send lien waivers automatically based on the amount of the commitment.

Lien Waivers: To Process an AP Document with Lien Waivers

This activity will walk you through the process of working with lien waivers.

Story

Suppose that the ToadGreen company needs to pay a bill to a subcontractor, the Architectural Design Company. Acting as a project manager, you need to enter a subcontract, create and pay the bill in the system, and make sure that the related lien waiver has been generated and sent to the subcontractor.

Configuration Overview

In the U100 dataset, the following tasks have been performed to support this activity:

On the Enable/Disable Features (CS100000) form, the Construction and Construction Project Management features have been enabled.
On the Non-Stock Items (IN202000) form, the CONCRMX non-stock item has been created.
On the Projects (PM301000) form, the HOTEL project has been created with multiple project tasks, including 02 - SITEWORK.

Process Overview

You will enter a subcontract on the Subcontracts (SC301000) form. Then you will create an accounts payable bill for this subcontract on the Bills and Adjustments (AP301000) form. You will pay the bill by preparing and releasing a payment on the Checks and Payments (AP302000) form. Finally, you will print the generated lien waiver on the Print/Email Lien Waivers (CL502000) form, and mark the lien waiver as received on the Compliance Management (CL401000) form.

System Preparation

Before you start working with lien waivers, do the following:

Sign in as a construction project manager by using the ewatson username and the 123 password. Lesson 6: Tracking Compliance and Lien Waivers | 48
In the info area, in the upper-right corner of the top pane of the Acumatica ERP screen, make sure that the business date in your system is set to 2/15/2025. If a diﬀerent date is displayed, click the Business Date menu button, and select 2/15/2025 on the calendar. For simplicity, in this activity, you will create and process all documents in the system on this business date.

Step: Working with Lien Waivers You process a subcontract and review the generated lien waiver by doing the following:

On the Subcontracts (SC301000) form, add a new record.
In the Summary area, specify the following settings:

Vendor: ARCHCO
Location: MAIN (specified automatically)
Date: 2/15/2025
Description: Purchase of concrete for the Hotel project

On the Details tab, add a row, and specify the following settings in the added row:

Inventory ID: CONCRMX
Project: HOTEL
Project Task: 02 - SITEWORK
Cost Code: 02-000
Order Qty.: 100
Unit Cost: 500 Notice that the subcontract total is 50,000, which exceeds the minimum commitment amount specified for the vendor and project.

On the form toolbar, click Remove Hold to assign the subcontract the Open status.
On the form toolbar, click Enter AP Bill. The Bills and Adjustments (AP301000) form opens with the new document, which has the Bill type and the document details copied from the subcontract to the Details tab.
On the form toolbar, click Remove Hold, and then click Release to release the bill.
On the form toolbar, click Pay. The Checks and Payments (AP302000) form opens with the AP payment prepared for the bill. The payment should have the On Hold status. Open the Compliance tab, and notice that it is empty.
On the form toolbar, click Remove Hold, and then click Save. The system automatically generates a lien waiver and adds a line on the Compliance tab, as shown in the following screenshot.
```
   Figure: The lien waiver generated for the payment
```

Lesson 6: Tracking Compliance and Lien Waivers | 49

              The same lien waiver record also appears on the Compliance tab of the Projects (PM301000),
              Vendors (AP303000), Subcontracts (SC301000), and Bills and Adjustments (AP301000) forms
              for the involved records. The record also appears on the Compliance Management (CL401000)
              form.

9. On the Print/Email Lien Waivers (CL502000) form, do the following: a. In the Action box, select Email Lien Waivers. b. Select the unlabeled check box for the lien waiver that was automatically created earlier in this activity. c. Click Process on the form toolbar. d. Close the Processing dialog box. 10.Open the Outgoing (CO4092PL) inquiry form. 11.On the My Emails tab, review the list of outgoing emails. Make sure that the row for the sent email has been added; the line should have the Lien waiver description in the Summary column, and eve.stewart@arc.example.com must be specified in the To column. 12.Open the Compliance Management (CL401000) form. 13.On the Lien Waivers tab, review the settings of the processed lien waiver, and make sure that it has the Processed check box selected. 14.In the row with the lien waiver, select the Received from Vendor check box to indicate that the signed copy of the lien waiver has been received from the vendor. 15.Save your changes.

You have finished working with the lien waiver. Lesson 7: Using Project Issues and Change Requests | 50