How it runs for construction companies and contractors
Retainage, deposits on materials and customer overpayments are posted to the right balance-sheet accounts instead of revenue. By the close, estimate-versus-actual is current for every open job and the WIP schedule ties to the ledger.
What is outsourced bookkeeping?
Outsourced bookkeeping means a remote accounting team records, categorizes and reconciles your business transactions instead of an employee doing it in-house. You keep ownership of the accounting file and the bank relationship. The provider works inside your software on a fixed schedule, so the books are ready for reporting, tax and lending whenever you need them.
What we handle for construction companies and contractors
- Daily coding of bank and card feeds to job, phase and cost type
- Supplier invoices matched to purchase orders and delivery tickets
- Equipment costs allocated to jobs by hours or rental days
- Material deposits and customer prepayments held on the balance sheet
- Weekly open-items list of uncoded costs sent to the project manager
The KPI that matters here
Zero uncoded job costs older than 7 days, measured every Friday.
Construction compliance notes
Sales tax on materials
In most US states a contractor pays sales tax on materials at purchase and does not charge tax on the finished job. A few states, including Arizona and Washington, tax the contract itself, and many states have separate rules for repair work versus new construction. We set up tax codes per state and contract type and track exempt purchases with resale or project certificates on file.
Retainage
Retainage withheld by owners is recorded as retainage receivable, and retainage you withhold from subcontractors is recorded as retainage payable. Several states cap retainage on public work, commonly at 5%, and set release deadlines after completion. We track the release date per contract so closeout billing goes out on time.
Job costing and WIP
Bonding companies and lenders expect a work-in-progress schedule that ties to the general ledger, with contract value, costs to date, estimated cost to complete and billings to date. We maintain the schedule monthly and book over and under billing entries so the P&L reflects percentage of completion.
CIS in the UK
Under the Construction Industry Scheme, UK contractors deduct 20% from registered subcontractors and 30% from unregistered ones, and file a monthly CIS return with HMRC. We verify subcontractors, prepare the deduction statements and CIS return workings, and reconcile deductions suffered against your PAYE liability. Your accountant or the business submits the return.
Construction software we work in
- QuickBooks Online
- QuickBooks Desktop
- Xero
- Bill.com
- Gusto
- Sage 50
- Buildertrend
- Procore
- All 50 platforms
More for construction companies and contractors
Other services for construction
Frequently asked questions
How do you code costs to jobs without slowing down the field?
Field staff keep using the app they already have, such as Buildertrend or a photo of the receipt sent to Dext. The accountant applies the job, phase and cost code in the ledger and asks the project manager only about items with no obvious job. Rules for recurring suppliers and equipment vendors handle most of the volume automatically.
Do you track committed costs from purchase orders and subcontracts?
Yes, open purchase orders and subcontract commitments are tracked per job so the estimate-versus-actual report shows costs to date plus committed costs. This gives a truer picture of remaining margin than paid invoices alone. When Buildertrend or Procore holds the commitments, we reconcile them to the ledger each month.
Can you keep books for both a general contractor and its related entities?
We keep separate files for the operating company, an equipment holding company and any development entity, with intercompany charges booked on both sides. Equipment rent, shared payroll and management fees are allocated by a schedule you approve. Consolidated views are prepared when a lender or surety asks for them.
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