Contractor accounting questions
Questions about job-cost records.
Practical answers for builders, remodellers and trade owners weighing general bookkeeping against dedicated construction job-cost accounting.
How is job-cost record keeping different from regular bookkeeping?
A general bookkeeper categorises expenses for year-end tax filing, putting all lumber under “Materials” and all wages under “Payroll”. Job-cost accounting assigns every direct invoice, rental ticket, sub draw and burdened labour hour to a specific project and CSI phase code, reconciles retainage receivable and payable, tracks subcontractor COIs and lien waivers, and produces a monthly Work-in-Progress over/under-billing schedule.
Do we have to switch off QuickBooks to get accurate job-costing?
Not necessarily. QuickBooks Online Plus/Advanced and QuickBooks Desktop Enterprise Contractor produce solid job-cost and WIP reports when set up with a disciplined chart of accounts, phase mapping and payroll allocation by project. For larger contractors outgrowing QuickBooks, we also work inside Sage 100 Contractor and sync platforms such as Buildertrend, Procore and Knowify.
What is a WIP schedule, and why do banks and bonding agents ask for it?
A WIP schedule compares the share of estimated cost you have spent on an active contract with the share of the contract price you have billed. If you have billed 60% of a job but completed only 40% of the cost, that 20% gap is over-billing: cash in your account that you still owe in future work. Sureties and banks use WIP reports to see true earned profit.
How do you get foremen and crews to turn in receipts and accurate hours?
We keep the field steps effortless. Crews photograph supply-house tickets at the pickup counter and pick the job on a simple mobile timecard with 8 to 15 high-level phase codes, not 200 accounting codes. Our back office handles line-item splitting and statement matching.
What goes into calculating our true hourly labour burden?
Employer FICA and Medicare, FUTA and SUTA unemployment, trade-specific workers’ comp class rates, payroll-based general liability premiums, health and retirement contributions, paid holidays, non-billable shop and drive time, and small-tool or service-truck allowances. Most trades find their true burdened cost is 32% to 55% higher than raw hourly pay.
Do you replace our current tax CPA?
No. We work closely with your tax CPA. Instead of a shoebox ledger in March, they receive reconciled bank and loan accounts, verified retainage balances, completed-contract or percentage-of-completion WIP schedules and clean 1099-NEC filings, ready for tax planning.
Can you clean up active jobs that started mid-year with messy records?
Yes. During onboarding we set a clean cutoff date and reconstruct direct job costs and draw histories for every open contract, so your active WIP schedule is accurate. Prior closed months are reconciled for tax reporting without re-coding old closed jobs line by line.
How are monthly fees set as our project volume changes?
After the initial diagnostic and cost-code setup, monthly retainers are tiered by your average active contract count, field crew size and whether we administer AIA progress draws and lien waivers, so your accounting cost stays predictable all year.