How to build a schedule of values

2026-09-04 · 6 min read

Geometric abstraction of seven aligned bars with a green total — Aligned bars, one green total, no variance.

The schedule of values is the map every future application is read against. Structure it the way the work will be walked, total it exactly, and get it approved before application no. 1.

What the schedule is for

The schedule of values divides the contract sum into line items that can be assessed as a percentage. Every pay application for the rest of the job is read against it. A good schedule makes billing arithmetic; a bad one makes billing an argument you re-run monthly.

The single hard rule: it must total the contract sum exactly. Not approximately, not before change orders. A schedule that does not reconcile is returned before anyone reads the line items.

Geometric abstraction of a six-square grid — Seven aligned bars, and one total that has to match.

Structuring lines people can assess

Break the work the way a field superintendent would walk it. “Underground rough-in”, “above-ceiling ductwork”, “equipment set” — each is something someone can look at and agree is 60 percent done. “Labour” and “materials” are not lines; they are cost categories, and they turn every application into an estimate.

8 to 20 lines on a mid-size subcontract. Fewer is unbillable, more is unassessable.
A modest mobilisation line, defensible on its own cost.
One line per major scope or area, matched to how the work sequences.
A closeout line — O&M manuals, as-builts, final balancing — near the end.
New change orders as new lines, never folded into existing ones.

Front-loading, honestly

Front-loading means weighting early lines above their true cost to improve cash position. Everyone knows the practice; reviewers look for it, and lenders' consultants look harder. A modest mobilisation line is normal. A mobilisation line at 15 percent of the contract is a fight you will have every month, and it slows every application that follows.

The honest version of the same goal is a closeout line that is genuinely small, so that the money is earned early because the work is early — not because the paper says so.

Approval first

Get the schedule approved before the first application, not with it. An unapproved schedule turns application no. 1 into a negotiation, at exactly the point your cash position is worst.

Keeping it alive

Change orders go in as new lines with their own numbers, so the audit trail survives. Percentages move up, never down, unless work was genuinely mis-assessed — a line that drops from 80 to 60 percent invites an inspection of everything else.

At closeout the schedule is the document that proves the contract sum was fully earned. Build and check it on the schedule of values builder, which flags the variance against the contract sum as you type.

Geometric abstraction of crossing rules with a green square — Change orders as new lines, so the trail survives closeout.

Sources

FAR 52.232-27(a)
On a federal construction contract, a progress payment is due 14 days after the designated billing office receives a proper payment request; an improper invoice must be returned within 7 days with reasons.
Read 2026-09-04
Tex. Prop. Code § 53.101
Texas requires the owner to reserve 10 percent of the contract price (or 10 percent of the value of the work) during the job and for 30 days after completion — statutory retainage.
Read 2026-09-04