Progress Valuations in Construction

On a site that lasts months, the contractor does not wait until the end of the works to be paid: it receives interim payments as the work progresses. The tool that measures this progress and turns it into an amount is the progress valuation.

Let's look at what it is, how it is generally prepared, which mistakes to avoid and why it pays to link it to the bill of quantities and cost control.

What a progress valuation is

A progress valuation (in Italian SAL, stato avanzamento lavori) is the accounting document that certifies the work carried out up to a certain date. It is the basis for interim payments during the execution of the work.

In practice, a progress valuation takes a snapshot of the site at a precise moment: which work items have been completed, in what quantities and for what total amount. Each new valuation updates the snapshot, taking into account what was already valued in the previous ones.

For the contractor it is a financial tool, because it determines income during the works. For the client it is a control tool, because it lets them check that payments match what has actually been built.

The frequency of progress valuations and how they are issued depend on what the parties have agreed, normally in the contract and the specifications. That is why, before the works start, it is worth being clear about how often a valuation will be prepared and which documents must accompany it.

How it is prepared

In general terms, preparing a progress valuation follows three steps.

1. Measurements

The work carried out on site up to the reference date is measured: metres, square metres, cubic metres, number of elements installed. Measurements must be verifiable and documented.

2. Quantities

The measurements are mapped to the items in the contract and the bill of quantities, giving for each item the quantity carried out in the period and the cumulative quantity.

3. Contract prices

The unit price set in the contract is applied to each quantity. The sum of the items gives the value of the work carried out, from which the amount already recognised in previous valuations is deducted.

A good progress valuation is therefore the result of continuous recording on site. A well-kept site diary is a valuable aid in reconstructing what was done and when.

Checking and sharing

Before it is sent, the progress valuation must be checked: do the quantities match what was actually carried out? Are the items those in the contract? Do the totals take previous valuations into account? A thorough internal check reduces requests for clarification and speeds up approval by the client. Always keep the supporting documentation, such as measurements and photos, so it is easy to show if requested.

Common mistakes

• Undocumented measurements: quantities that are hard to verify lead to disputes and payment delays.
• Items not aligned with the contract: work items recorded with descriptions or units of measurement different from those agreed.
• Double counting: quantities already valued in a previous valuation and entered again.
• Outdated prices: using prices different from the contract prices or inconsistent with any variations.
• Disconnected files: bill of quantities, measurements and valuations kept in separate Excel sheets that must be realigned by hand.

Many of these mistakes have the same origin: information is collected at different times, by different people, with different tools. The more manual steps there are between the measurement on site and the valuation amount, the higher the risk that something gets lost or counted twice.

Progress valuations, bill of quantities and cost control

The progress valuation does not stand alone. The bill of quantities defines the planned work items, with quantities and prices; cost control records what is carried out; the progress valuation periodically sums up this data in an amount. If the three tools use different data, every change has to be entered several times, with the risk of errors.

When they are linked, on the other hand, a change to the bill of quantities is reflected in cost control and the progress valuation, and the quantities carried out can always be compared with those planned. It is the simplest way to keep the site's financial performance under control. To find out more about the starting documents, also read what contract specifications contain.

How software helps

The IntraThor Bill of Quantities and Cost Control module is integrated: specifications, estimates, progress valuations and cost control work on the same data, and changes to the bill of quantities are automatically reflected in cost control and progress valuations. Within IntraThor Construction the module is also linked to operational site management, suppliers and staff.

The result is less work realigning files, progress valuations that are quicker to prepare and a constant view of the financial status of the works.

Having progress valuations linked to the rest of the data also helps you read how the site is going: by comparing what has been valued with what was planned, it is easier to spot cost or time deviations early.

F.A.Q. - Frequently asked questions

General information only, not legal advice: always check the current legislation.