A schedule of values is a detailed breakdown of the contract sum, prepared by the contractor, which allocates a value to each part of the work. It is used as the basis for preparing and checking progress payments.
The term is mainly used in North American practice. In the UK the same idea appears under different names depending on the contract, such as a contract sum analysis under JCT design and build contracts, an activity schedule under NEC Options A and C, or a schedule of stage payments. It should be reviewed carefully at the outset, because it governs cash flow for the rest of the job. Points to watch include:
- front loading, where early activities are overvalued to improve the contractor’s cash flow
- items that are too large to value fairly at each payment date
- whether the breakdown will also be used to value changes
Related terms: contract sum analysis, activity schedule, interim payment, front loading.
