Construction companies need accounting systems that show more than total revenue and expenses. Owners need to understand how individual jobs are performing, where costs are changing, how much cash projects require, and whether reported profitability reflects the economics of work in progress.
GoldWiseman CPAs provides construction accounting services that connect job-level financial information with company-wide reporting and decision-making.
Construction accounting requires financial information to be organized around both the business and its individual projects.
Revenue, labor, materials, subcontractors, equipment, overhead, billing, retainage, and project timing can all affect reported financial results.
GoldWiseman can support construction companies with:
The goal is to give management reliable financial information at both the project and company level.
Job costing helps contractors understand what each project is actually costing the business.
Costs may need to be tracked across categories such as:
When project costs are recorded accurately and consistently, management can compare actual performance with estimates and identify jobs where margins are changing.
Construction projects often span multiple accounting periods.
As a result, billings, cash receipts, costs incurred, and accounting revenue may not move together.
Work-in-progress reporting helps management understand the financial status of active projects.
A useful WIP schedule can provide visibility into:
GoldWiseman helps construction companies develop accounting processes and reporting that make WIP information more useful to management.
A project that appeared profitable when estimated may produce a different result as work progresses.
Labor productivity, material prices, subcontractor costs, change orders, delays, and unexpected project conditions can affect margins.
GoldWiseman helps contractors compare estimated and actual financial performance so management can identify margin changes before the project is complete.
Profit and cash flow can look very different in construction.
A contractor may need to pay employees, subcontractors, suppliers, and other project costs before receiving corresponding customer payments.
Retainage and billing timing can create additional pressure on working capital.
GoldWiseman helps construction companies forecast expected cash receipts and expenditures so management can better anticipate periods of increased cash demand.
Growth can place significant demands on a construction company's working capital.
More projects may mean more labor, materials, subcontractor payments, and other expenditures before cash is collected from customers.
Management therefore needs visibility into more than revenue growth.
Financial reporting should also help track:
GoldWiseman helps connect these balance-sheet items with project and cash flow reporting.
Company budgets and project estimates answer different financial questions, but both matter.
Project budgets help management evaluate individual jobs, while the company budget considers the broader cost of operating the business.
GoldWiseman helps contractors develop financial budgets that incorporate expected revenue, payroll, overhead, equipment, facilities, insurance, professional costs, and other operating expenses.
Regular budget-to-actual reporting can help management identify changes in company-wide financial performance.
Reliable financial statements should help owners understand both current financial position and operating performance.
GoldWiseman helps construction companies prepare and analyze financial information including:
When financial statements are connected with project-level information, management gets a much clearer picture of how individual jobs are affecting the overall business.
As a construction company grows, financial processes that worked for a smaller operation may no longer provide adequate control or visibility.
Responsibilities for purchasing, invoices, payroll, job-cost coding, payments, billing, and reconciliations should be clearly defined.
GoldWiseman can help contractors strengthen accounting processes and financial controls without adding unnecessary complexity.
Construction companies may need stronger accounting capabilities before they are ready to build a complete internal finance department.
GoldWiseman can supplement existing accounting staff or provide outsourced accounting and controller-level support.
Services may include month-end close, reconciliations, financial reporting, WIP review, job-cost analysis, budgeting, cash flow forecasting, and management reporting.
Construction business decisions can have significant tax implications.
Equipment purchases, entity structure, owner compensation, project profitability, capital expenditures, and the timing of income and expenses can all affect tax planning.
GoldWiseman connects accounting and financial reporting with proactive tax planning so contractors can evaluate tax considerations before year-end.
Strong construction accounting connects individual project economics with the financial performance of the entire company.
GoldWiseman helps contractors build that connection through job costing, WIP reporting, financial statements, cash flow forecasting, budgeting, margin analysis, and accounting oversight.
For additional industry-specific information, visit our Construction Industry Accounting.