Published November 21, 2025 . 0 min read

A Schedule of Values (SOV) can sound technical when you first encounter it, but it is one of the core financial tools used on construction projects. At its simplest, a Schedule of Values is a roadmap that shows how the contract value will be broken down, billed, and tracked as the project progresses. It connects the contract, the scope, and the cash flow.

This guide explains what a Schedule of Values is, why it matters, and how it works in practice, so you can understand the basics before exploring more advanced billings and financial strategies.

What Is a Schedule of Values

A Schedule of Values is a detailed list that breaks the total contract amount into individual line items, each tied to a specific portion of work. Think of it as a structured budget that assigns value to each phase of the project.

Example: Commercial Office Build SOV Line Items

All line items together equal the full contract value. This breakdown becomes the basis for progress billing, project tracking, and cash flow planning.

Why the Schedule of Values Matters

Billing Transparency
Contractors use the Schedule of Values to support each pay application. Owners and architects can review progress line by line, which makes it clear what has been billed and what remains.

Cash Flow Management
Construction work requires steady cash. With a clear SOV, contractors can bill fairly as work is completed, which helps ensure funds are available for labor, materials, and equipment.

Project Tracking and Controls
Owners, lenders, and project managers use the Schedule of Values to compare the percent complete in the field to the amounts billed. This helps prevent:

• Overbilling, which occurs when billing runs ahead of actual progress
• Underbilling, which occurs when billing lags behind progress and puts pressure on cash flow

The SOV becomes a shared financial reference for the entire team.

How a Schedule of Values Works

Final Thoughts

The Schedule of Values is more than just paperwork; it’s the financial backbone of the project. Clearly outlining how the contract amount is allocated and billed helps ensure transparency, fairness, and smoother cash flow for everyone involved.

Suppose you want to go beyond the basics. In that case, there’s a deeper dive on how the Schedule of Values affects cash flow, including how contractors build proportional SOVs, apply modest front-loading, and track overbilling and underbilling. It explains how structuring the SOV the right way can help stabilize project cash flow. You can read it here: Schedule of Values in Construction: Structure Them to Protect Cash Flow.