A schedule of values (SOV) is a comprehensive document listing the cost of each work item and the amount of work completed for a construction project. It provides a detailed breakdown of the total contract value and cost progressions for each project stage, making it a key reference point for contractors, managers, architects and project owners during payment processing.
Most contractors organize the components of an SOV into a chart or table at the beginning of a project and update the document as work progresses. While not every construction job requires an SOV, most contractors encounter them at some point in their career as they take on larger, more complex projects.
In this guide, we’ll walk through the process of filling out and submitting an SOV, explain how it’s used and provide a downloadable schedule of values template that you can reference for future projects.
Table of Contents
- Why Is an SOV Important?
- When To Use an SOV
- What Should a Schedule of Values Include?
- Downloadable Schedule of Values Template
- How To Fill Out and Submit an SOV
Why Is an SOV Important?
The schedule of values is essential in keeping complex projects on track and avoiding payment delays. Contractors and subcontractors use SOVs to help keep track of work completed, support payment applications and ensure that the cost of each work item matches the contract price. Without it, contractors risk mismanaging costs and overspending early in the project.
In some cases, an inaccurate SOV can be just as detrimental as not having one at all. If an SOV contains errors, contractors can face issues ranging from minor scheduling delays to payment and cash flow disruptions. If a discrepancy is severe enough to cause an extended delay, it could lead to a breach in prompt payment laws and incite serious legal action.
An accurate SOV is also an important tool for project owners. By looking at an updated SOV, the owner can verify that work is progressing according to schedule and within the project budget. It allows them to release payments on time, avoid project delays and provide other stakeholders with accurate updates.
When To Use an SOV
SOVs are best suited for contractors working on large-scale commercial projects with multiple moving parts. Contractors taking on these complex projects need a schedule of values to keep up with the budget, cost tracking and payment application management.
Smaller projects with a fixed price, approved budget or guaranteed maximum price contract can also benefit from an SOV. These types of contracts set the total project cost ahead of time, and an SOV’s in-progress cost breakdowns can help ensure that the project never goes over budget.
What Should a Schedule of Values Include?
The main components of an SOV include a list of work items, values for each item and the amount of work completed. The size and scope of a schedule of values can vary depending on the project’s complexity, but most SOVs contain the following components:
- Project name and number
- Name of the prime or general contractor
- Application number and date
- Work item numbers
- Description of work items
- Total value of each item
- Percentage of work completed
- Value of work completed for past and current periods
- Balance remaining for each item
- Retainage percentage and amount for each item
- Consent and acknowledgment
Downloadable Schedule of Values Template
While there is no required format for an SOV, most contractors use a chart or spreadsheet to record values and submit payment applications. The following template includes the most common components of an SOV and allows you to quickly update costs as the project progresses.
How To Fill Out and Submit an SOV
The detail required for an SOV can vary depending on the size and complexity of a project, and the document can change as the project progresses. To ensure that your SOV is as accurate as possible, consider the following steps.
Step 1: Confirm the Contract Price
Before you can start filling out the SOV, you’ll need to confirm the total contract price and project details with the owner. Jumping ahead could lead to inaccurate value estimates forcing you to make time-consuming edits later on.
This is also a good time to ask the project owner or architect how much detail they require for an SOV. While some allow less specific cost breakdowns that combine similar work items, others might require you to separate them out in a highly detailed list.
Step 2: Add Work Items
Once you’ve confirmed the details with the project owner, you’ll need to add a list of work items and accompanying item numbers to your SOV. This list should cover the entire project from start to finish, and each item should include a short, easy-to-read description. You can reference initial construction estimate reports to help as you fill out this and the next section.
Step 3: Determine Each Item’s Value
The projected value for each work item should be as accurate as possible to avoid payment discrepancies and keep the project flowing smoothly. As you consider each line item, look carefully at all associated equipment, material, labor and transportation costs. You’ll also need to record the agreed-upon retainage fee for each item. The retainage is part of the initial contract and typically includes 5% to 10% of the total contract price.
Step 4: Update As Work Is Completed
As the project progresses, you’ll need to update the SOV to reflect the percentage of work completed, the amount billed for each period and the cost remaining for each work item. Most large projects require multiple applications for payment, so it’s important to keep your SOV as up to date as possible for the project’s duration.
Step 5: Review and Confirm Values
Before you submit an application for payment, take some time to review and confirm the values listed on the SOV. The project owner should have signed off on the initial values at the beginning of the project, but it’s good to periodically check all in-progress costs for accuracy.
Step 6: Submit With the Application for Payment
For projects that use a fixed price contract or progress billing, contractors should submit the SOV, all change orders and any other supporting documents with each application for payment. Project owners and other stakeholders can use the SOV to verify completed work quickly. An accurate list of values allows them to release payments to contractors and subcontractors on time.
Filling out and submitting a schedule of values can feel like a complicated process at first, but it makes projects run much more efficiently over time. Updated SOVs can also serve as a helpful reference when submitting other construction documents like RFIs, change orders and payment applications.
If you’re ever unsure about what to include in an SOV, consult with the project owner to verify their desired format and level of detail. This will ensure that payments are processed on time and each work item is completed according to plan.