What it is and where it comes from
The SAL is the accounting document summarising all the work and all the supplies executed from the start of the contract up to the moment it is issued. It is the precondition for every interim payment.
Article 12 of Annex II.14 to the public contracts code fixes its nature and content. The document is derived from the registro di contabilità and is issued in the terms and manner set out in the tender documents and the contract, for the purpose of paying an instalment on account.
That it is derived from the register rather than built independently is the most important technical point. The SAL is not a fresh measurement: it is a synthesis of what the register has already recorded, and its accuracy depends entirely on the accuracy of the chain preceding it.
The mandatory content
The law identifies precisely the three figures the document must state. Omitting one renders the document incomplete.
| Figure | Meaning |
|---|---|
| Consideration accrued | Total value of work executed since the start of the contract |
| Instalments already paid | Sum of the amounts previously released |
| Instalment now due | The difference between the first two |
The cumulative structure is what distinguishes the SAL from a period statement. Each interim valuation restarts from the beginning of the contract rather than from the previous one, and the amount to be released emerges by difference. This has an operational advantage: an error made in an earlier SAL is corrected in the next one without the need for a corrective instrument, because the cumulative figure is recalculated.
A worked calculation
| Item | Third SAL |
|---|---|
| Consideration accrued since the start of the contract | 486,000 |
| Instalments already paid (first and second SAL) | 342,000 |
| Instalment now due | 144,000 |
Any retentions and deductions provided for by the contract and by the applicable rules are then applied to that figure, and these vary with the contract and should be checked in the capitolato speciale. The values are illustrative.
The sequence leading to the invoice
The procedural chain is set by law and worth following in order, because each step is a precondition for the next. Skipping a step invites formal challenge even where the amounts are right.
The works supervisor checks and measures the work executed and records it in the registro di contabilità. From the register the interim valuation is derived. The works supervisor transmits it immediately to the responsabile unico del progetto, the single project officer, who issues the payment certificate. The project officer, having verified the contractor's social security compliance, sends the certificate to the contracting authority for the payment order to be issued. Every certificate issued is noted in the register. Once the certificate has been issued, the contractor may raise the corresponding invoice.
Two steps in this sequence are frequently misunderstood. The first is ownership: the SAL belongs to the works supervisor, the payment certificate to the project officer, and the two instruments do not overlap. The second is the social security condition, which is a check preceding transmission of the certificate rather than a subsequent formality.
What to check before issuing a SAL
Most disputes over an interim valuation are prevented by a sequence of checks that takes little time before issue and a great deal of time afterwards. The checks cost minutes before and weeks after.
| Check | Question to ask |
|---|---|
| Source of quantities | Does every amount derive from the register rather than the design bill |
| Rates applied | Are they the net contract rates reduced by the discount offered |
| Certifiable work | Are items excluded whose satisfactory execution requires certificates not yet obtained |
| Cumulativeness | Does the consideration accrued restart from the beginning of the contract |
| Previous instalments | Does the sum of amounts released match the certificates issued |
| Timing | Does issue comply with the terms set in the tender documents and the contract |
| Non discountable components | Are safety charges valued without applying the discount |
| Concealed measurements | Was work covered by later stages measured before being concealed |
The last row is the one that admits no recovery. Every other check can be repeated; a measurement not taken before the work was covered cannot be reconstructed, and estimating it afterwards is precisely what opens the way to dispute.
Timing
The terms and manner of issue are not fixed uniformly by law: they are set out in the tender documents and in the contract. They must be sought in the contract rather than in a general rule.
In practice the two prevailing approaches are issue on reaching value thresholds and issue at intervals tied to the construction programme. The first links payments to actual progress, the second gives the contractor greater cash predictability. The choice should be made when drafting the documents and not left to interpretation, because it affects the financial balance of the project.
Lump sum contracts
Under a measured contract the SAL is built on measured quantities. Under a lump sum contract it is built on the work stage percentages achieved, derived at detailed design stage from the bill of quantities and aggregated in tabular form by part of the works.
For the purposes of interim payment, amounts and percentages may also be shown broken down into their principal components, and that disaggregation is what prevents a substantial instalment remaining tied to the full completion of a long duration part of the works. The breakdown allows the uncontested part to be paid.
How it differs from the bill of quantities
The two documents belong to different stages and confusing them is common. One records, the other authorises payment.
The bill of quantities is the deliverable estimating the cost of executing the works at design stage. The interim valuation is an accounting document of the construction stage, summarising progress for the purpose of issuing the payment certificate.
The distinction has practical as well as conceptual weight. A SAL built by carrying over the bill quantities rather than the measured ones certifies nothing: it attests the forecast, not the execution, and does not survive verification.
The most frequent errors
A SAL built without going through the register is the first, and deprives the document of its evidential basis. The document thereby loses all evidential basis.
Calculating by period rather than cumulatively is the second, and complicates the correction of earlier errors. Correcting an earlier error then becomes impossible without redoing everything.
Including work whose satisfactory execution requires certificates not yet obtained is the third, and produces objections when the payment certificate is issued. The objection arrives when the payment certificate is issued.
Issuing at intervals other than those set by the contract is the fourth, and invites formal challenge regardless of whether the amounts are correct. The challenge is formal and independent of whether the amounts are right.
In private construction
The regime of Annex II.14 does not apply to private work, but the mechanism transfers and its absence is the most frequent cause of disputes about progress. Its absence is the most frequent cause of dispute over progress.
Setting out in the contract who measures, at what intervals, on which document quantities are recorded and which steps authorise invoicing takes a few lines. Without them, the argument reverts to the original quotation, which is never the right instrument for certifying what has been built.
Note: the values used in the example are illustrative. Legislative references relate to Italy and are current as at the date of publication: the version in force should be checked before any operational use.