Why Construction Contractors Hate Waiting for Answers  In construction, waiting is expensive. Construction contractors frequently find themselves waiting. Waiting on material.  Waiting on inspections.  Waiting on approvals.  Waiting on payments. The last thing a contractor needs is to be waiting on their accounting team. Useful construction business accounting means being available to contractors so they aren’t left waiting once again.  But waiting (even for accounting info)

Get a Grip on Knowify You know (whether you’re a carpenter or not) that holding a hammer incorrectly will not produce the desired result efficiently and effectively.  So it goes with the business tool known as Knowify. Knowify is indeed a construction management software for small to medium contractors. It is also true that using this tool correctly will make the difference between an unsteady, and time-consuming bonking of nails and a master carpenter’s strong, swift stroke,

This three-part series on the business side of a construction business began with  How to Learn the Business Side of the Construction Business , followed by How to Understand the Business Side of the Construction Business. Today, the topic shifts from learning and understanding to mastering the business side of a construction business.   By understanding these five areas, construction business owners are better equipped to master the business side of a construction business

The Piano Example When I was a youngster, I bugged my mom for several weeks to let me take piano lessons. She finally agreed, found a piano teacher, and arranged for my first lesson. Imagine my surprise when I learned that my piano teacher expected me to know such odd things as where the C note was on the keyboard, what each symbol on the row of lines represented, how long my fingers should remain on any individual key, and all sorts of other rigamarole.   And on top of that

The purpose of this article is to discuss construction liens (also known as mechanics' liens) and how construction accounting is a vital component in reducing the risk of not getting paid for labor or materials expended on construction projects. However, before delving into that discussion, we must first address an essential aspect of dealing with the legal side of construction liens. While, when followed correctly, lien laws create a legal claim on the property’s title, ther

Adjusting the Flow For healthy and profitable construction businesses, it comes down to adjusting the flow of cash effectively. That means that construction accounting is the groundwork for establishing stability, security, and confidence for contractors.   The key to adjusting the cash flow in construction is to recognize some fundamental elements that come into play at various stages – they are:   Revenue Recognition Progress Billing Job Cost Tracking Work in Progress (WIP)

Construction accounting – it’s different. Construction accounting requires a few key practices that set it apart from “regular” accounting protocol. When you understand the key practices and how to address them, you can make the transition to sustainable growth and a more profitable construction company. Here is a breakdown of what to look for.   Revenue Recognition Let’s start with this doozy. Construction contractors must track revenue and costs over extended contract perio

Running With the Big Dogs When operating your construction business, there comes a time when you must choose; you can Run With the Big Dogs , or you can dog along running .  Construction accounting is the pivot point. No matter how good you are at the hard skills of your trade or the soft skills necessary to own a business, your numbers (the accounting) are the foundation for building your construction company. Dealing with those numbers can be either a hassle and hindrance o

There are numerous types of IRS Form 1099. This article will focus on the 1099-NEC because it is the most commonly used form in the construction industry. While many aspects remain the same when using the IRS Form 1099-NEC, a change will affect reporting for the 2026 tax year. It is essential to note that for the 2025 tax year, construction businesses must still issue Form 1099-NEC under the old reporting standards, which is due by February 2, 2026.   Here are a few things th

Putting Strategy in Its Place The strategy involved in planning begins with an understanding of how to reach goals.  The goal  is the main “big thing” you want to accomplish.  A strategy  is the path you take to achieve a goal.  Built into your strategy will be objectives .  The tactics  you use to reach each objective are the tools that make it happen. Example: Planned Weight Loss Think of it this way. Say your goal is to lose weight. Goal:  Lose 20 pounds in 4 months Strate

What you’ll find in this article is a schedule of bookkeeping tasks that successful construction contractors use to guide the financial management of their businesses. That doesn’t mean they drag out the spreadsheets and fill in the blanks at the end of the day. It does mean they have a fundamental understanding of what their accounting team is responsible for and what “next steps” must be taken. However, before we delve into the schedule, let’s take a moment to understand th

We asked Brian Harding, a leading authority on developing high-performing teams, to share with our construction contracting clients and other readers about planning for proactive problem-solving year-round. He offers excellent advice that may come as a surprise. Here is what he had to say.   It’s that time of year! With the holidays also comes the time when we plan for next year. Before going too far down the planning path, I think it’s worth asking, “Why do we typically make

In a few recent posts (listed below), information was presented to help construction contractors understand how implementing the right systems in their financial dealings allows them to take control and steer toward building a debt and risk-resilient construction business.   The Hidden Cost of Debt in Subcontracting (Understanding actual job costs up front reduces the need to borrow just to stay afloat.)   Budgeting as a Financial Risk Management Tool (A proactive budget le

Just as you take time to address risks on the jobsite, you must take time to address risk from a financial perspective. Learn why the...

Debt Feels Like an Easy Solution – But It’s Not! Got a cut on your hand? Clean it up, put on a bandage, and go about your day. But...

Site Preparation for Construction Project Estimates Project estimate  – a detailed prediction of the total cost to complete a...

Figuring out what an employee costs means paying attention to all the price tags accompanying his or her base wage or salary. Those tags...

Understanding What Choosing a CPA Means Yes, you WANT someone who can prepare tax reports for your construction business (and many people...

The following information is based strictly on the Percentage of Completion type of WIP Reporting, which we suggest as the best practice...

WIP Reports -- A Powerful Tool in Your Financial Toolkit The question we answered in an article titled Is a WIP Report Worth the Effort?...