It’s because the requirements to finish the job are unique and the availability of the materials or equipment is a huge factor that can affect the costs. At Stratlign, we proudly serve businesses in construction and the trades as financial management partner. As you grow, we’ll provide the accounting and bookkeeping services that you need to manage your revenue and expenses while remaining compliant with all local, state and federal regulations. Our diligent method ensures that your financial records are accurate and up to industry standards.

Small Business

Since the prices of construction materials can easily change due to several economic factors, a contractor must quickly acquire these materials in order to prevent a huge loss. Also, a construction company needs a systematic accounting approach to keep track of its expenses. It’s a major concern that makes construction accounting & financial management valuable even for start-ups.

At AuerCPA, we are passionate about helping our Northern Colorado construction clients realize maximum profits.

Therefore, it is essential for construction companies to keep accurate records of all financial transactions and to file their taxes on time. Construction companies have unique accounting needs that require specialized bookkeeping practices. This section will cover the fundamentals of bookkeeping for construction companies, including accounting methods, chart of accounts, and job costing essentials. A company with five members would be easier to handle than a company of 50. The more employees you have, the more layers you have and the more diverse your business becomes. But construction bookkeeping what makes construction accounting more complicated is that construction contractors must deal with variable costs.

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With more money coming in, they were able to cover all the expenses without running out of capital for the next batch of materials. This also saved the company from running on multiple loans, which is not a smart alternative. As a construction accounting consultant in Fort Collins, Steven helped our client address all the problem areas that threatened his company so that he could overcome them. With an expert in accounting for a construction company, the use of budget can be more controlled. The fast-changing price ranges of materials make the construction business delicate. When you and the client enter into a contract with a set budget, it’s not easy to make adjustments in pricing.

Payroll Management

Sometimes, the turnover you get from bad training, lazy employees, and needing to rehire and fix the job yourself accumulate costs that although inevitable can be prevented. However, the accounting aspect of his business was suffering and this prevented his company from generating profits. Many subcontractors think that working hard translates to bigger income, but this is not always the case. This includes labor, materials, overhead (trucks, fuel, general liability insurance, workers’ compensation insurance, and more), and anything that is variable (like depreciation on trucks).

• At Stratlign, we proudly serve businesses in construction and the trades as financial management partner.
• We partner with you to take care of all the numbers, from part-time bookkeeping, monthly accounting, tax preparation, payroll services, part-time CFO services and more.
• We care for your accounts receivable by creating and sending timely invoices, keeping tabs on unpaid amounts, and efficiently managing collections.
• There’s a difference between a subcontractor and a contractor in terms of the construction industry.
• Construction companies have specific tax obligations that they need to comply with.
• Normally, the markup price should have been shouldering the cost of the jobs that Joe was taking on.

Suddenly, you can no longer keep up with the numbers and start losing profit. That doesn’t make them instant experts in the type of jobs that you engage in. Providing them with training materials in the form of manuals, audios, visuals, and the like can help them understand their responsibilities and the business. Joe needed an in-depth understanding of these critical matters to save his business. But we did not forget to mention the less obvious but impactful cost-cutting issues.

We help you meet all your tax responsibilities, such as submitting filings accurately and on time, disclosing your income, and making tax payments. Our proficiency and cutting-edge technology will keep your construction company’s finances organized so you can stay focused on what you are good at. We have the capabilities and experience to cater to the demands of any construction company, no matter how big or small. Our business is helping construction companies to stand firm and stable, ensuring that everything tax-related is handled efficiently, affordably and with great care. It’s the amount you need to add to the cost of materials to make a profit. Financial and other company issues will deter you from achieving your financial goals and growing your business.

Maintain separate accounts for each subcontractor, and pay invoices promptly to maintain a positive relationship and avoid penalties. Further, our income statements include these three key financial metrics so that you can assess financial https://www.inkl.com/news/the-significance-of-construction-bookkeeping-for-streamlining-projects health, monitor sales, and pinpoint opportunities to cut costs and increase revenue. We will do a complete cost analysis of your project, keeping tabs on everything from labor and supplies to subcontractors and rental equipment. We provide a complete picture of each project’s financial health by correctly attributing expenses to their jobs or projects.