How to build a schedule of values for a subcontract pay application

A schedule of values (SOV) is an itemized list that splits your contract price into the pieces of work you will bill. Build it so the lines add up to your subcontract amount, match the general contractor’s (GC’s) lines, and describe work someone can see on site. Do that, and every pay application after it gets easier to approve.

What is a schedule of values?

AIA Contract Documents describes the schedule of values as “an itemized list that allocates the entire contract sum to the various portions of the work”. It is typically used when the contractor is paid on a stipulated sum or guaranteed maximum price basis.

The same AIA article says the G703 continuation sheet is often used to record the schedule of values. It also says the architect uses the schedule as a basis for reviewing payment applications. Under AIA A201 section 9.3, the itemized application for payment must be prepared in accordance with the schedule of values.

In plain terms, the SOV is the list your pay app is built on. The cover form, the G702, shows totals. The lines sit on the G703.

Who prepares it, and when?

On a prime contract, AIA’s A201 section 9.2 says the contractor shall submit a schedule of values to the architect before the first application for payment. A subcontractor usually does the same for its own scope. The GC reviews your lines before rolling them into its own application.

Send your SOV before you bill, not with your first bill. If the GC or architect wants changes, you want that conversation before money is waiting on it.

How do you split a subcontract into lines?

Corpay’s schedule of values guide (updated June 2026) says each line should be granular enough that the percentage-complete measure for that scope is defensible. It also warns that lines such as “Project Management” or “Coordination” that do not map to inspectable work are red flags for the architect.

A practical way to build yours:

1. Start from your subcontract amount. Every dollar must land on a line.
2. Break the scope into phases you can point to: submittals, rough-in, trim-out, testing, closeout.
3. Split big phases by floor, area or system when progress will differ.
4. Add separate lines for materials you expect to bill when stored, if your contract allows it.
5. Check the lines against the total before you send them.

Keep the cost behind each line in your own estimate file. If asked how you got a number, you can show it.

1. 1Start with the subcontract amount
2. 2Split the scope into visible work
3. 3Match the GC's line structure
4. 4Check that lines add up
5. 5Submit before the first pay app

Should your lines match the general contractor’s?

Yes, as far as you can. Corpay’s guide says a sub whose schedule line items do not map to the GC’s schedule will create reconciliation friction in every pay application. It notes that the GC’s schedule rolls up sub work into broad scope buckets, and that aligning early is cheap while fixing it later is expensive.

Ask the GC’s project manager for their SOV or their line structure for your trade. You can keep more detail underneath, as long as your lines roll up cleanly into theirs.

What is front-loading, and why do reviewers look for it?

Front-loading means putting more value on early work than that work is worth. The AIA article says it “accelerates cash flow to the contractor, resulting in overpayments early in the project” and can be especially troublesome if the contractor defaults. It adds that the architect may review supporting data to check for it.

An architect’s review is not a formality. A Design Cost Data article from July 2022 says the architect can certify only the percentages of completion actually observed on the date of physical observation. Its author calls front-loading a fraudulent practice when values are overstated, and says the effect is to overpay the contractor at the beginning.

Corpay’s guide says mobilization above roughly 2 to 5 percent of the contract draws scrutiny. Treat that as one vendor’s rule of thumb, not a legal limit. Your contract and your GC set the real expectations.

The safer habit is simple. Price each line from real cost and a fair share of overhead and profit, then bill only what is in place.

How do change orders fit in?

Corpay’s guide says change orders are added to the schedule of values as new line items, not merged with existing lines. Keeping each one separate preserves clarity and survives the audit at closeout.

So when a change order is approved, add a line for it with its own number and amount. Do not bill it until it is approved. Your retainage calculation should follow the contract terms for it, which can differ from the base work.

What mistakes cause the most trouble?

• Lines that do not add up. The total must equal your subcontract amount.
• Vague lines. “General conditions” is hard to measure. Use scope someone can inspect.
• Lines that do not match the GC’s. Expect questions on every application.
• Padding early work. It invites cuts and slows approval.
• Changing lines mid-job. If you must, get approval in writing and keep a record of the old and new lines.
• Forgetting stored materials. If your contract allows billing them, plan the lines before the order arrives.

Where Payrung fits

Payrung is being built to take the schedule of values you already have and carry it into each pay application, so the math, retainage and change-order lines stay consistent from one month to the next. Join the waitlist.

This article is general information, not legal or accounting advice. Pay application requirements come from your contract and your state’s law, so check them with a construction attorney or your accountant.