Bookkeeping & Accountant for General Contractors & Builders

Properly managing change orders ensures that all changes are documented, approved, and reflected in the project’s budget and timeline, preventing scope creep and cost overruns. Our construction bookkeeping services are designed to meet the specific needs of construction companies, ensuring that your financial records are accurate and up-to-date. Because construction is project-based, you need a way to see how well individual projects are performing at a granular level, instead of trying to get a grip on your company’s financials from five miles above.

Business Tax Preparation and Filing

Construction billing is a critical aspect of construction accounting, directly influencing cash flow, project profitability, and the overall financial health of a construction company. Due to the nature of construction projects, which often span several months or even years, billing must be managed carefully to ensure that payments are received timely and accurately reflect the work completed. Job costing is a cornerstone of construction accounting, involving the precise allocation of expenses to specific construction projects. It provides detailed insights into all project-related costs, aiding in accurate cost estimation, budgeting, and profitability analysis. By tracking expenses such as labor, materials, equipment, and subcontractors at the job level, construction firms can make informed decisions, control costs effectively, and ensure that each project remains profitable. At its core, Construction Accounting involves the meticulous tracking and allocation of costs to specific projects, often referred to as job costing.

• If you operate a construction management firm, or are a general contractor, subcontractor, residential developer, or own a business in the construction-related trades, you need an accounting firm that understands your business.
• Chris combines his experience in tech and construction to build products that actually help SMB contractors improve and streamline their business operations.
• You’ll also use the contract’s total cost and scope of work to develop the project’s schedule of values, which breaks down individual billable tasks and their value.
• With this information in your accounting system, tracking things like retainage and change orders, issuing purchase orders or subcontracts, and keeping client billings on schedule becomes much easier.
• These costs are typically spread across all projects or allocated proportionally based on certain metrics such as revenue or labor hours.

Our Construction Accounting Services

Passageway Financial Tax & Accounting is the top bookkeeping service for contractors https://www.bignewsnetwork.com/news/274923587/how-to-use-construction-bookkeeping-practices-to-achieve-business-growth and construction companies in the United States. The construction industry has unique challenges because of its complex set of accounting rules and tax regulations. Our Cincinnati CPA firm specializes in serving this dynamic and challenging industry. We will work with your construction firm to evaluate your profitability on current projects, help you with budgeting and projections and develop tax planning strategies to help minimize your taxes. Progress billing is one of the most widely used methods in construction, particularly for long-term projects. It allows contractors to bill clients incrementally based on the percentage of work completed during a specific period.

What You’ll Learn in This Guide:

• Our Cincinnati CPA firm specializes in serving this dynamic and challenging industry.
• Our Contractors Outsourced Bookkeeping Services System Is An Assembly Line – Where contractors bookkeeping services tasks are divided into groups and assigned by skill level.
• Progress billing is one of the most widely used methods in construction, particularly for long-term projects.
• We’ll share a quick overview and then a comparison list of regular bookkeeping vs construction bookkeeping.
• This  method is commonly employed in construction accounting, particularly for larger or longer-term projects, as it provides a more comprehensive  understanding of a project’s profitability and financial health.
• Properly managing change orders ensures that all changes are documented, approved, and reflected in the project’s budget and timeline, preventing scope creep and cost overruns.

The difference between a Professional Bookkeeping Service and a Cheap Bookkeeper can cost you tens of thousands of dollars a year or more on your bottom line profit. A surefire way to lose out on project profitability is to do work you’re not paid for. An effective change order management system is your first line of defense against this.

Tax Season Support

For example, they usually have longer billing cycles than other businesses, which means it may be difficult to forecast revenue accurately. Construction companies are also likely to encounter unexpected business expenses that must be paid quickly, so they need access to a larger cash reserve. Ideally, each of your financial accounting processes should work together seamlessly as a part of a larger system. A construction accounting software makes this level of integration simple, so you can keep track of everything and enable more informed decision-making as time goes on. It’s hard to protect your margins on the job without being able to see how it’s performing in real-time. WIP reports make it easier construction bookkeeping to get an overview of each project’s budget, percent complete, actual costs to date, and more, so you can see if it’s overbilled or underbilled.

• While G&A costs are not directly tied to specific jobs, they must still be accounted for within the overall financial management of the business.
• Accountant websites designed by Build Your Firm, providers of CPA and accounting marketing services.
• Under this method, clients are billed for actual labor hours worked and materials used, plus a markup for overhead and profit.
• If you are considering an audit for your construction company, you need to work with an accounting firm that has years of experience with providing audits to the construction industry.
• AIA billing is a standardized billing method developed by the American Institute of Architects (AIA).