Construction Accounting Services
Construction contractors face several unique construction accounting challenges. First and foremost, contractors need reliable job costing systems so they know when a construction job makes money--and when it doesn't.
Second, construction contractors face extra complexity in their tax accounting principally because of two Internal Revenue Code requirements: One requirement is to capitalize construction costs so the costs can be matched with construction revenues. Another requirement, which usually applies only to large contractors, is to recognize income as a construction project progresses, based on the percentage of completion, rather than at the point the contract is completed.
A third complexity--or maybe burden is a better word--is that contractors are often required by their lenders and bonding companies to have outside CPAs perform compilations, reviews or audits of their financial statements.
If you're a contractor and need these types of construction accounting services, please consider contacting me. Construction contractors represent an area of industry specialization for me. And I personally serve a number of home and commercial contractors.
A final note: If you’re currently using the vanilla version of QuickBooks, be aware that Intuit also sells a “contractors” version of QuickBooks for construction accounting which provides more convenient job costing and project costing.
Related Topics:
- Accounting Formulas
- Accounting Terms
- Accrual Basis Accounting vs. Cash Basis Accounting
- Analyzing Multifamily Real Estate Investments
- Construction Accounting
- Converting from Cash Basis Accounting to Accrual Basis Accounting
- How to Be a Good Bookkeeper
- How to Compare Rental Property Investments
- How S Corporations are Taxed
- Protecting Your Business From Embezzlement
- Tracking Rental Property with Quicken Software
