We’re often asked the question “what is construction accounting”. We’ve even been asked this even by builders and construction companies. It’s the basis under which Subcontractor Support has been bourn and understanding what it is fundamental to the success of construction company. It’s what sets construction companies apart from any other business.
Construction Accounting is the process whereby you identify/analyse the varied range of costs you have relating to specific projects. These are all cost related to the construction process, right from materials, labour costs, consultancy and all management expenses.
It builds the financial picture of the project so that the business can understand exactly what was spent on each area of the build. Costs fall into three categories. Direct costs are labour, material, and subcontracting costs, land. Indirect costs include indirect labour, supervision, tools, equipment costs, supplies, insurance, and support costs.
Without your business understanding this critical accounting process you have no idea how much money was spent on each project. This makes it impossible to know if a project made or lost money.
Click here to see some examples of construction reporting.
Subcontractor Support’s understanding of construction and the importance of Construction Accounting is what sets us apart from any other accounting or bookkeeping service. When has your accountant or bookkeeper ever run a construction company?
Contact us today for a free 30min consultation call with our director Tim Chase to understand how construction accounting would revolutionise your business.