Schedule of Values
The contract price divided into line items so progress can be billed fairly each month.
Quick Answer
A schedule of values (SOV) is an itemized breakdown of the total contract price into line items, usually by trade or spec division, that a contractor submits for the owner's or architect's approval. It becomes the basis for monthly pay applications, where each line is billed by percent complete.
The Full Picture
A contract sum gives a single number, but payment happens in pieces as work is completed. The schedule of values divides that number into line items so the owner, architect, and contractor can agree what each portion of the work is worth and measure how much has been done. Without it, progress payments would rest on a loose guess of overall percent complete.
A typical SOV lists items such as mobilization, general conditions, site work, concrete, structural steel, mechanical, electrical, and finishes, along with the contractor's overhead and profit and sometimes allowances and contingencies. Many projects follow CSI MasterFormat divisions, and a good SOV is detailed enough to track progress without becoming unmanageable. The sum of the lines must equal the contract sum.
Each month the contractor submits a pay application, commonly on AIA forms G702 and G703, showing for each line the scheduled value, work completed in prior periods, work in this period, materials stored, and the balance to finish. The architect or owner reviews the percent-complete claims against what they observe on site, and retainage is usually withheld from each approved amount.
The SOV is built during preconstruction, from the estimate and buyout, and the way it is built has financial consequences. An SOV that front-loads costs lets the contractor bill ahead of work and is usually challenged by owners. One that mirrors the estimate and subcontract values makes billing, change-order tracking, and cost reporting much easier throughout the job.
Real Examples
Common Misconceptions
People assume: People assume the schedule of values is the same as the estimate.
Actually: it is derived from the estimate but organized for billing, and it generally does not expose the contractor's detailed unit costs.
People assume: People assume the SOV can be changed freely during the project.
Actually: it is part of the approved payment framework, and revisions typically need owner or architect agreement, usually through change orders.
Frequently Asked Questions
What is a schedule of values?
A schedule of values is an itemized allocation of the contract price across the work, such as by trade or spec division, used as the basis for progress billing on pay applications.
What form is used for a schedule of values?
On many projects the SOV appears on AIA Document G703, the continuation sheet that accompanies the G702 application and certificate for payment, though owners may use their own forms.
How detailed should a schedule of values be?
Detailed enough to measure progress accurately, typically by trade or division and major activity, but not so granular that billing becomes burdensome. The owner or architect usually has to approve it.
What is front-loading?
Front-loading is assigning inflated values to early work items so the contractor bills more earlier than the work warrants. Owners and architects commonly reject or rebalance it.
When is the schedule of values created?
It is prepared near contract award from the estimate and subcontract values and submitted for approval before the first pay application.