What Is a Schedule of Values in Construction?

A schedule of values is one of the foundational financial documents on a construction project. It sets out how the total contract price is divided across the individual components of the work, and it forms the basis for how a contractor requests payment over the life of a project. While the document itself can look like a simple table, it plays a central role in keeping payments organized, transparent, and tied to actual progress on site.

This article explains what a schedule of values is, how it is structured, how it relates to payment applications, and the common issues that tend to arise when it is prepared or managed poorly.

What Is a Schedule of Values?

A schedule of values, often abbreviated as SOV, is an itemized breakdown of the total contract sum into the various portions of work required to complete a project. Each line item represents a specific scope of work or a defined cost component, and each is assigned a dollar value. When the values of all line items are added together, they equal the full contract amount.

The schedule of values typically appears at the start of a project, after the contract is signed but before the first payment application is submitted. It is usually prepared by the general contractor and then reviewed by the owner, the architect, or the construction manager. Once it is agreed upon, it becomes the reference document against which the contractor measures and bills for completed work.

In construction, the schedule of values serves a different purpose than the estimate or the bid. An estimate reflects what the contractor expects the work to cost. The schedule of values, by contrast, reflects how the agreed contract price will be allocated and billed. The two may share line items, however they are not interchangeable.

Why the Schedule of Values Matters

The schedule of values matters because it connects the contract price to the payment process. Construction projects are rarely paid in a single lump sum at completion. Instead, contractors are typically paid in installments, often monthly, based on the portion of work completed during each period. The schedule of values provides the framework that makes this possible.

For the owner, the document offers visibility into where money is being allocated and how much of each scope has been completed. For the contractor, it provides a structured way to request payment that aligns with the work performed. For the architect or construction manager who certifies payment, it offers a basis for evaluating whether a payment request is reasonable.

When the schedule of values is well prepared, it tends to reduce disputes over payment, because both parties are working from a shared and pre-agreed breakdown. When it is poorly prepared, it can become a source of friction, since disagreements over how much work has been completed may be harder to resolve.

How a Schedule of Values Is Structured

A schedule of values is generally laid out as a table, with each row representing a line item and each column capturing a piece of information about that item. While formats vary, several elements appear consistently.

Line item description.
Each row identifies a specific scope of work, such as site preparation, concrete foundations, framing, roofing, mechanical systems, or electrical work. The level of detail can vary; some schedules use broad categories, while others break the work into more granular components.

Scheduled value.
This is the dollar amount assigned to each line item. The sum of all scheduled values equals the total contract amount.

Work completed to date.
This column tracks how much of each line item has been finished, usually expressed as a dollar figure or a percentage. It is updated with each payment period.

Materials stored.
Some projects allow contractors to bill for materials that have been purchased and delivered to the site but not yet installed. This column captures the value of those stored materials.

Total completed and stored.
This combines the work completed and the materials stored to show the cumulative value earned to date for each line item.

Balance to finish.
This represents the remaining value of work not yet completed for each line item.

Retainage.
Many contracts allow the owner to withhold a percentage of each payment, commonly five or ten percent, until the project reaches a defined milestone. This withheld amount is known as retainage, and the schedule of values often tracks it.

The AIA documents, including the AIA G703 continuation sheet, provide a standardized format for laying out a schedule of values. The G703 is designed to be used alongside the AIA G702 application and certificate for payment, and together they form a common framework for billing on many projects.

The Schedule of Values and Payment Applications

The schedule of values is closely tied to the payment application process. A payment application, sometimes called a pay app or a draw request, is the document a contractor submits to request payment for work completed during a billing period.

The schedule of values acts as the backbone of each payment application. Rather than describing the work anew each month, the contractor updates the schedule of values to reflect the additional progress made since the previous period. The payment application then summarizes the amount being requested based on those updates.

This relationship is most clearly seen in the AIA system. The G702 form serves as the cover sheet that certifies the payment request, while the G703 continuation sheet carries the detailed line-item breakdown drawn from the schedule of values. Each month, the contractor revises the completed and stored values, calculates the new amount due, and submits both documents together.

Because the schedule of values drives billing, the way it is structured can influence cash flow. A schedule that front-loads value into early activities may allow a contractor to recover costs sooner, however owners and their representatives often scrutinize the breakdown to guard against this. A balanced schedule that reasonably reflects the cost and effort of each scope tends to be easier to administer and less likely to draw objections.

Common Pitfalls to Avoid

A schedule of values is simple in concept, however several issues tend to recur in practice. Being aware of them can help keep the document accurate and useful.

Insufficient detail.
A schedule with very few line items can make it difficult to assess progress accurately. When a single line covers a large and complex scope, it becomes harder to determine how much of that scope is truly complete.

Excessive detail.
At the other extreme, breaking the work into too many small line items can make the schedule cumbersome to update and review each period. A balance between clarity and manageability tends to work best.

Line items that do not match the contract total.
If the sum of all scheduled values does not equal the contract amount, the schedule is incorrect and will create problems during billing. The totals should always reconcile.

Inconsistent treatment of change orders.
As a project evolves, change orders may add or remove scope and adjust the contract price. These changes should be reflected in the schedule of values, either as new line items or as adjustments to existing ones, so the document continues to match the current contract value.

Overstating completion.
Billing for more work than has actually been completed can lead to disputes and may delay payment certification. Progress should be reported honestly and supported by what is observable on site.

Front-loading the schedule.
Assigning higher values to early work to improve short-term cash flow can leave an owner paying ahead of actual progress. Owners and construction managers tend to watch for this, and some contracts allow an unbalanced schedule to be rejected and revised before the first payment is approved.

Ignoring stored materials rules.
Contracts differ in how they treat materials stored on or off site. Billing for stored materials without meeting the contract's requirements, such as proof of delivery or proper storage, can result in those amounts being rejected.

Schedule of Values Across Different Contract Types

The role of the schedule of values can vary depending on the type of contract in place. On a lump sum or fixed price contract, the schedule of values divides a single agreed price into billable components, and it is central to how progress payments are calculated.

On a cost plus contract, where the contractor is reimbursed for actual costs plus a fee, the schedule of values may play a more supporting role, since billing is often tied directly to documented costs rather than to a fixed allocation. Even so, a schedule of values can still help organize and categorize the work.

Understanding how the schedule of values fits within a given contract structure helps clarify how it should be prepared and used. For a broader discussion of contract structures, it can be useful to review materials on construction contract types and on change orders in construction, both of which interact closely with how a schedule of values is built and maintained.

Managing a Schedule of Values

A schedule of values can be prepared and maintained in a spreadsheet, and many smaller projects are still managed this way. The line items, scheduled values, completed amounts, and retainage can all be tracked in columns, and the totals can be reconciled against the contract sum by hand or with formulas.

On larger or more complex projects, construction management platforms are often used to handle the schedule of values alongside other project financials. Platforms such as Procore and Autodesk Construction Cloud include tools for building a schedule of values, updating completed and stored amounts each period, and generating payment applications from those values. These systems tend to reduce manual reconciliation and keep the schedule of values connected to the broader project record.

The choice between a spreadsheet and a dedicated platform usually depends on the size of the project, the number of parties involved, and the level of reporting required. The underlying logic of the schedule of values remains the same regardless of the tool used to manage it.

Conclusion

A schedule of values is a straightforward document with an important role. By dividing the contract price into clear, billable line items, it gives owners, contractors, and certifying parties a shared basis for tracking progress and processing payments. A well-prepared schedule tends to make billing smoother and disputes less likely, while a poorly prepared one can create friction throughout a project. Whether it is kept in a simple spreadsheet or managed within a construction platform, the schedule of values stays close to the center of how a project's finances are organized and how work is paid for over time.

Frequently Asked Questions

What is a schedule of values in construction?
‍A schedule of values is an itemized breakdown of the total contract price into individual components of work, each assigned a dollar value. It is used as the basis for requesting and certifying progress payments throughout a project.

Who prepares the schedule of values?
‍The schedule of values is usually prepared by the general contractor and then reviewed and approved by the owner, the architect, or the construction manager before the first payment application is submitted.

What is the difference between a schedule of values and an estimate?
‍An estimate reflects what a contractor expects the work to cost. A schedule of values allocates the agreed contract price across components for billing purposes. They may share line items, however they serve different functions.

What is the AIA G703 form?
‍The AIA G703 is a standardized continuation sheet used to lay out a schedule of values. It is designed to be used with the AIA G702 application and certificate for payment, and together they form a common billing framework.

Why do owners review the schedule of values so carefully?
‍Owners review the schedule of values to confirm that values are reasonably allocated and not front-loaded. A balanced schedule helps ensure that payments stay aligned with the actual value of completed work.

Can a schedule of values change during a project?
‍Yes. As change orders adjust the scope and contract price, the schedule of values should be updated to reflect those changes so it continues to match the current contract value.