How to use the schedule of values pay application builder
- List each line of the schedule of values: a description, its scheduled value, the work completed in earlier periods and this period, and materials stored.
- Enter the net change from change orders, the retainage percentages for completed work and for stored materials, and the total of earlier payment certificates.
- Read the summary lines of the pay application and the amount due this period.
- Check the continuation sheet table for the percent complete and balance to finish on each line, and download the CSV.
Formula
3. Contract sum to date = original contract sum (total of scheduled values) + net change orders
4. Total completed and stored = work completed (earlier and this period) + stored materials
5. Retainage = retainage % x completed work + retainage % x stored materials, each rounded to the cent
8. Current payment due = (4 - 5) - 7, where 7 is the total of earlier certificates; 9. Balance to finish = 3 - (4 - 5)
The line numbers follow the layout of the common application and certificate for payment. Retainage rates are inputs from your contract, not rules.
A five-line project
A project with five lines totaling $360,000 has $120,000 of work from earlier periods, $75,000 more this period, and $8,000 + $4,500 = $12,500 of stored materials, so $207,500 is completed and stored. At 10% retainage on both, the retainage is $19,500 on work plus $1,250 on stored materials, $20,750 in all. The amount earned less retainage is $186,750, and after $103,500 of earlier certificates the payment due is $83,250.00. The project is 57.6% complete.
With a $6,500 change order, a $130,000 contract becomes $136,500. After $100,000 of work with 5% retainage on work and none on stored materials, the retainage is $5,000, the earned amount is $95,000, and after $66,500 of earlier certificates the payment due is $28,500.00.
How a pay application works
On many construction jobs, the contractor and the owner agree on a schedule of values at the start: the contract price divided into lines, such as site work, concrete and finishes. Each month, the contractor reports how much of each line is done, and what materials have been bought and stored on site. The owner pays for the work completed, less retainage held back until the job is finished.
The page builds the summary lines and the continuation sheet from your entries. For retainage on a single invoice, use the retainage calculator; to bill by percent complete, the progress billing calculator; and to price a change, the change order calculator.
Checks to make
The page warns you when a line is billed above its scheduled value, which usually means a change order is missing, and when the amount due is negative, which means earlier certificates exceed the amount earned. Check that the earlier certificates match your records, since a typing error there is carried straight into the amount due.
Retainage practice varies by contract and by place, and some contracts reduce it after the job is half done. Enter the rates your contract states. The page shows negative amounts in parentheses and rounds retainage to the cent. For an invoice document with your details, use the invoice generator.
Assumptions and limits
- Amounts are in one currency, entered to the cent, with up to 40 lines.
- Retainage is a percentage of the total completed work and of the total stored materials.
- Change orders are net and are added to the contract sum only; add each change order as a line if you want it on the continuation sheet.
- The page does not apply sales tax, fees or interest; it is a calculation aid and not a legal form.
Frequently asked questions
What is a schedule of values?
A breakdown of a contract price into lines of work, used to decide how much to pay each month.
What is retainage?
A percentage of each payment held back until the job is complete, as a safeguard for the owner. The rate comes from the contract.
What goes in the stored materials column?
Materials paid for and stored on site that are not yet installed. They are not part of the work completed.
Why is my payment due negative?
Because the earlier certificates are above the amount earned to date, often after a typing error or a reduction in work.