What are cost codes?

A Schedule of Values (SOV) is a detailed breakdown of a construction contract that itemizes the total contract amount into specific work categories, phases, or deliverables. It shows the dollar value assigned to each component of work that’ll be completed during a construction project. As such, the SOV is a critical component of successful project and cash flow management. It also lays the groundwork for progress billing and payment applications (like AIA® G702/G703® forms).

Here’s how it works: 

• Contractors create initial SOVs that allocate contract value across work phases.
• They maintain the SOVs to align with actual work schedules and ensure billing requests match project progress.
• SOVs get updated when changes occur on the job, altering the original scope and budget.

As you can imagine, managing multiple SOVs across projects while tracking actual costs against line items becomes complex and time-consuming.

Siteline streamlines this entire process by integrating with major construction ERPs and accounting software. Subs import project data from their ERP into Siteline, compile and send pay apps directly in the system (accounting for any change orders), and then rest easy knowing that Siteline automatically syncs approved invoices back to the ERP. 

The result? Faster billing cycles and quicker payments. Want to see how it works? Book some time with us.

A bond in the construction industry is a type of surety bond, which serves as a financial guarantee for project completion. It safeguards the interests of stakeholders such as project owners, suppliers, and subcontractors, in the event that the contractor fails to fulfill the contract conditions. Bonds are usually required for public works projects in ensure taxpayers' money is well spent. There are different types of bonds such as bid bonds, performance bonds, payment bonds, and maintenance bonds. For instance, a performance bond guarantees the contract's terms are fulfilled, while a payment bond ensures laborers, suppliers and subcontractors are paid. Bonds are crucial in risk management in construction contracts.

Liquidated damages in the construction industry are a pre-agreed sum specified in a construction contract, which the contractor will pay to the client in the event of a breach of contract, typically when there are delays in completion. This contract clause serves as a protection mechanism for the client, giving an estimate of the potential loss they might incur due to the delay. However, liquidated damages must be a genuine pre-estimate of loss, not a penalty. They are not intended to be a punishment, but a compensation for the client's actual anticipated loss. This approach mitigates the risks and provides predictability for both parties in a construction project. One party cannot claim more than the contracted liquidated damages. They bring certainty to the potentially complex process of calculating actual damages in construction delays, thus fostering an efficient dispute resolution.