Misthora

How to build a schedule of values that gets approved (with free template)

The schedule of values (SOV) is the backbone of every pay application you’ll send on a project. You write it once at the start, and every month after, you bill against it line by line. A sloppy SOV means twelve months of painful billing; a good one makes every pay app almost automatic.

The rules that matter

  1. The lines must sum exactly to the contract amount. Not roughly, to the penny. GCs check this first.
  2. Break work into lines you can defend. Each line needs a percent complete you can justify on a walk-through. “Electrical, $250,000” as one line means every month is a negotiation. Fifteen to thirty lines is typical for a small trade contract: mobilization, rough-in by area or floor, panels and gear, devices, fixtures, trim, closeout.
  3. Separate labor-heavy from material-heavy lines. Stored materials get billed (and retained) differently; a line that mixes a $40k switchgear package with its installation labor makes stored-material billing murky.
  4. Include a mobilization / general conditions line. Legitimate early costs deserve a line, that’s not games, that’s cash-flow honesty.

About front-loading

Everyone knows the temptation: weight early lines heavier so cash arrives sooner. Mild weighting toward genuine early costs is normal practice. Obvious front-loading gets caught in SOV review, damages trust, and starves the back end of the project, where your last dollars are already being held as retainage. Weight lines by real cost plus honest overhead allocation, and let the mobilization line carry the early cash need.

Change orders join the SOV

Approved change orders become new lines (or documented adjustments to existing lines), they don’t get smeared invisibly across the sheet. Your “net change by change orders” figure on the pay app summary has to trace to specific lines.

Set it up once, bill all year

Our free Excel template starts with the SOV sheet: enter your lines and values, and every later pay application computes against them with locked formulas, totals guaranteed to tie.