Schedule of Values and Progress Assessment: Percentage Complete, Stored Materials, Retainage, and Payment Correlation

Covers the schedule of values as a tool for tracking construction progress and correlating it to payment applications. Addresses percentage complete assessment, stored materials accounting, retainage mechanics, and the architect's role in certifying payments based on observed work in place versus the contractor's claimed progress.

ARE · Construction & Evaluation

Overview

The schedule of values (SOV) is the contractor's line-item cost breakdown of the work, submitted before the first payment application. It subdivides the total contract sum into individual work items (sitework, foundations, structural steel, mechanical systems, etc.) with dollar amounts assigned to each. The SOV serves as the baseline against which the architect evaluates construction progress and payment requests.

When the contractor submits a monthly application for payment using AIA G702 (Application and Certificate for Payment) and G703 (Continuation Sheet), each line item on the SOV shows the total value, work completed to date (both from prior periods and this period), stored materials not yet installed, total completed and stored, percentage complete, retainage, and the net amount due. The architect reviews this data against observed work in place during site visits.

Percentage complete on each line item should correlate with what the architect actually sees on site. If the SOV shows structural steel 60% complete but the architect's observation shows only the lower three floors of a seven-story building erected, the claimed percentage needs scrutiny. This correlation between the SOV and actual work is a primary function of construction observation under Objective 2.3.

Retainage is the percentage of each payment withheld by the owner as security against incomplete or defective work. Standard practice sets retainage at 5-10% of each payment, with the amount held until substantial completion. Stored materials represent items purchased and delivered but not yet incorporated into the work. The architect must verify that stored materials are properly protected and insured before certifying their value in a payment application.

Essential

The schedule of values is where money meets work. Every month, the contractor fills out a payment application claiming progress on each line item, and the architect has to decide whether those numbers match reality. Getting this right is a core skill for construction administration. Anatomy of a Payment Application The contractor uses AIA G702 (Application and Certificate for Payment) as the cover sheet and G703 (Continuation Sheet) as the detail. The G703 lists every line item from the schedule of values with columns for: description of work, scheduled value, work completed from previous applications, work completed this period, materials presently stored, total completed and stored to date, percentage complete, balance to finish, and retainage. The architect reviews the G703 against site observations. For each line item, you compare the claimed percentage complete against what you actually observed during your most recent site visit.

Professional

Consider a $25 million office building project at month 8 of a 16-month schedule. The contractor submits Payment Application No. 8 claiming 52% total completion. The architect reviews the G703 continuation sheet and notices several line items that need closer examination. The structural steel line item shows $3.2 million scheduled value with 85% complete claimed. During the site visit, the architect observes that all steel for the main building is erected but the steel for the connected parking structure (approximately 20% of the total steel scope) has not started. The 85% claim seems reasonable if the parking structure steel represents roughly 15% of the total steel value. The mechanical systems line item shows $4.5 million scheduled value with 35% complete claimed. The architect walks the building and finds ductwork and piping roughed in on floors 1 through 5 of 10 floors.

TLDR

The SOV breaks the contract sum into line items. Each payment application claims progress on each line item.
G702 = Application and Certificate for Payment (cover sheet). G703 = Continuation Sheet (line-item detail).
Percentage complete = architect's professional judgment based on site observation, not contractor's claim alone.
Watch for front-loaded SOVs: inflated early items, deflated late items. Review for reasonableness before accepting.
Stored materials: verify existence, proper storage, insurance, and documentation before certifying.
Off-site stored materials may require specific owner approval.
Retainage: typically 5-10%, held until substantial completion. Some contracts reduce at 50% complete.
Architect's certificate triggers the owner's obligation to pay (A201 Section 9.6.1).
Seven reasons to withhold/nullify certification under A201 Section 9.5.1.
Cross-reference the SOV against the construction schedule to identify discrepancies between claimed progress and schedule status.

ELI5

Think of a construction project like a really big group dinner where everyone ordered different dishes. At the end, you need to split the bill. But instead of waiting until the meal is completely over, the restaurant asks you to pay a portion after each course. The schedule of values is like the menu with prices. It breaks the total project cost into categories: foundation work costs this much, steel costs that much, plumbing costs this much. Each month, the contractor says, "Here is how much of each dish we have served so far, so here is what you owe us." The architect is like a friend at the table who checks whether the food actually arrived before you pay. If the contractor says, "We are 70% done with the electrical work," the architect goes to the site and looks.

AREConstruction & Evaluation

Schedule of Values and Progress Assessment: Percentage Complete, Stored Materials, Retainage, and Payment Correlation

2 min read261 words

The Schedule of Values as a Progress Tracking Tool

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