Viewpoint Primer | Industry Blog | Viewpoint Construction Software

Viewpoint Primer

There’s no question that accounting is one of the most complicated aspects of managing a construction business. That’s why a solid accounting software solution is probably the most important component of a contractor’s software suite. While success regarding profitable projects comes from a solid project management solution, it’s the accounting software that ensures the dollars are coming in at a greater rate than they’re going out.  

Tax-time Issues

While a whole spectrum of accounting issues can be addressed with integrated software, certainly one of the biggest accounting hurdles construction businesses face is tax-related problems. Referencing an excellent article written by the folks at McGuigan Tombs and Company CPAs, here are a couple tax problems unique to our industry.  Perhaps, you’ve experienced one of them.

As a contractor, there are numerous tax method choices available and even once you’ve chosen a method, there are tax rules that require changes on the fly. The need to keep up with all changes imposed by the IRS can make construction accounting a complicated task. According to McGuigan Tombs and Company CPAs, “A contractor must choose a method of accounting in the first year of existence.  Another method must then be selected the first year there is a long-term contract. When the first tax return is filed a method of accounting must be selected. This method will be determined based on a variety of factors – type of entity, gross revenue, and type of contracts performed.”

Plus, there are tax changes imposed every year by the IRS regarding how labor and revenue is reported. It’s virtually impossible to stay ahead of all these changes unless you have the technology in place to choose the right methods of accounting and manage the rapid ebbs and flows of tax laws. Many of today’s contemporary software providers include updates to address the tax law changes at the close of each year. These year-end updates assist with making the right accounting choices and ensuring all new tax law changes are followed.  

Reporting Power

When it comes to delivering the necessary financial data to Uncle Sam or some of your internal or external stakeholders, robust reporting is of paramount importance. Strong reporting capabilities are invaluable for providing accurate financial records to the IRS and presentation quality reports to executives and the industry at large. An effective integrated software package should offer easy-to-use tools for detailed budgeting, planning and forecasting that meet the needs of all your construction financial managers. Reporting capabilities like these make anyone involved in finance smile. Bottom line is no matter which way you go with your accounting software investment, make sure you can report the data the way your executive team likes to view it – and a way the IRS likes to receive it.  A good data report is nearly as essential to success as the data itself.

This is the eleventh in the Viewpoint Primer series on how technology improves construction productivity. We’d love to hear your stories – good or bad – with a General Ledger in Construction. What are some practices you’ve found that make a difference in your business performance?

{ 0 comments }

When contractors talk about construction software, they’re typically referring to an integrated accounting, project management and operations type of solution. Companies often handle other areas of their business, such as Human Resources, with a standalone solution or bolt-on construction human resources software systems. Be warned however, this is not a sustainable technology strategy.  Integrating your human resources data with the rest of the data you track and measure is essential for an overall snapshot of the health of your organization.

[click to continue…]

{ 0 comments }

When looking for construction billing software, flexibility is the key to keeping your accounting department and more importantly – your customers happy. The reality of today’s complex job billing procedures is that customers often request invoices to be designed a certain way to meet their accounting requirements. Refusing or being unable to meet those standards, could cause a major slowdown in payments and be the real catalyst for not winning their projects in the future.

[click to continue…]

{ 0 comments }

That’s a lot of stuff you have out there. Backhoes, bulldozers, cranes and front loaders – and let’s not even get started on the jackhammers, cement mixers and fleet trucks deployed at your jobsites.  The question is, “Do you have a grip on the costs, locations and revenue on those equipment assets?” Technology is available to make sure you’re on top of your investments and whether they’re costing or earning you dollars.
[click to continue…]

{ 0 comments }

For most people, unless you live in the accounting world, talking about the General Ledger might not be the most scintillating of topics, but it’s a pretty important part of your business. The GL is where everything financial in your business comes together. And we all know how important sound finances are for building a growing, sustainable company.

The GL provides a detail glimpse into your company financials. A messy GL could be a sign of bigger issues: things like poorly managing transactions and budgets, a lack of transparency, and understanding into your business’ performance. A messy GL takes time to reconcile and prevents you from knowing sooner of any potential issues your company faces which might let you take corrective action before a crisis. Keeping your GL clean makes it easier for auditors to review your financials and give you a clean bill of health.
[click to continue…]

{ 0 comments }