Contract value

Also called contract sum, contract price, original contract

Definition

The price the client agreed to pay for the original scope. It never changes retroactively; approved change orders sit on top of it to form the adjusted contract value.

Contract value is the anchor every other number on a job is measured against. Costs are compared to it for margin; payments are compared to it for what's left to collect; change orders are added to it for the adjusted total. The discipline is to never edit it. A contract that quietly grows from $68,000 to $71,100 hides the history; a $68,000 contract with a $3,100 change order on top tells the story and holds up when the client asks.

A worked number

Contract value $68,000. Change orders: pantry wall $3,000, countertop overage $2,875, credit for the client-supplied faucet minus $340. Adjusted contract value $73,535. Collected $52,000; left to collect $21,535, of which $6,800 is the final draw and the rest is the change orders due on approval that haven't been invoiced yet.

The mistake it hides

Measuring margin against the original contract after the scope grew. Extra work done for a change order looks like an overrun if the revenue side didn't move with it; the adjusted contract value is the right denominator, and a change order log is how it stays adjusted.

In Obra

The contract value is entered once per project and stays fixed; change orders are logged with their own dates and amounts, and the adjusted contract value drives what's left to collect and the expected margin. The Help Center's glossary names the exact fields.

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