The Top Bookkeeping Tips for Contractors

Additional features available in CoConstruct include proposal generation and both email and text communication functions. These features combined remove much of the overhead generated by keeping the customer informed of project costs or schedule changes.

• Labor costs are less predictable, mostly due to unexpected events or interruptions (weather, illness, etc.) that can have a crew falling behind.
• When attempting to find a bookkeeper, ascertain whether they have ever worked with construction firms similar to the size of your company before and whether they work solely within your state.
• The more projects your construction company manages and the more workers you contract, the more important it is to have your accounts in order.
• Getting timecards into QuickBooks and processing payroll can be a big hassle for your construction company.
• Both equipment use and labor, then, frequently move from site to site.
• That way, they don’t pay twice, but this requires careful attention to timecards and pay stubs.

It is especially essential when it comes time to catch up on bookkeeping at the end of the month or year. It can also help you avoid wasting time going through piles of statements and receipts when filing taxes. More than any other industries do, construction companies need to keep a close eye on its daily happenings particularly its job costing.

Why a Bookkeeping Service For Construction Companies Is Essential

Revenue recognition is the process of officially recording how and when your business generates revenue. Using milestone payments also makes it easier to identify payment problems, which, in turn, enables you to stop working until you receive payment for a milestone. The simplest way to account for retainage is to include two sets of information on your invoices. It allows you to estimate labor, material, and overhead cost, as well as determine how much you should charge for the project. Union rates, travel pay, and taxes can also impact how much you’ll need to pay your workers. Construction companies usually need to pay their workers what’s known as a prevailing wage.

• Information flows seamlessly between CoConstruct and QuickBooks, preventing users from entering information in two places while also ensuring that everything is always up to date.
• Complex costs from labor, transportation, equipment, materials and insurance all determine profitability.
• Completed contract – With this approach, revenue is only recorded once the project has been completed.
• Schedule a phone consultation with us, so we can discuss the services you need, and how best we can provide them.

Generally, you should avoid paying for anything in cash because those transactions are harder to track. Separate accounts help you better determine how much money is coming into your construction business each month. You can then better control how much is going out and from which part of your budget. In addition, segregating accounts helps ensure no one is writing checks against, say, payroll funds for nonpayroll expenses. Every Giersch Group client is assigned a controller as part of our unique approach to bookkeeping.

Separate Personal and Business Finances

Pacific Accounting and Business Services is an incredibly beneficial and cost-effective way of managing the day-to-day financial accounting for any organization. Those are just a few benefits that an excellent bookkeeper can bring to your contracting business. Savings, improved efficiency, actionable data, and managing growth are all benefits that take your business to the next bookkeeping for construction company level. Your bookkeeper helps you make the right decisions, see the entire business picture and catch problems while they are still small. We’ll modify our services accordingly to accommodate changes and seek improvements where necessary. Since our partnership is long-term, you’ll be able to make well-informed decisions on which projects are most lucrative in the future.

First, different jobs require different materials, the prices of which can vary wildly depending on what’s needed. After that, unforeseen and one-off fees like equipment repair or worker’s compensation can eat into profitability. Finally, the cost of shoddy bookkeeping itself can create issues if your business is audited. These are just a few examples of the complexity related to bookkeeping for construction https://www.bookstime.com/ companies. We understand projects, phase codes, cost codes, work in progress schedules, and all of the other factors that give you a headache. Job costing is a powerful bookkeeping tool for construction companies, who often do project or contract based work. Simply put, job costing is a method of calculating the true cost of a construction project by breaking it down into small, specific tasks.