A cost breakdown of the contract that shows how much each portion of the work is worth, used for billing.
A schedule of values (SOV) is a detailed breakdown of the contract sum into individual line items representing the cost of specific work scopes, materials, or project phases, used as the basis for calculating and processing monthly progress payment applications. The SOV is prepared by the contractor and approved by the owner and architect before the first payment application. It must reflect the actual cost distribution to prevent front-loading.
The schedule of values is the backbone of construction billing — it determines how a contractor converts completed work into cash each month, so an accurate, well-structured SOV protects cash flow while a poorly built one invites payment disputes. Owners and architects scrutinize it to catch front-loading, where a contractor inflates early line items to get paid ahead of actual progress, which exposes the owner if the contractor later defaults. Estimators map the bid into SOV line items carefully, since the breakdown directly drives draw approvals and lien-waiver tracking.
The owner's representative reviewed the schedule of values and required the contractor to reduce mobilization from 15% to 5% of contract value, treating the original allocation as front-loading that would have over-paid the contractor in the first two months.
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