Contractors accounting and finance the most important back-office services and in most cases the least understood. They provide you with information about how your company is doing financially as well as job costing to help you make intelligent business decisions on which jobs to go after hard and which ones to let go.

In today's competitive economy where you are scrambling for every job you need to know where you are making and losing money becomes bigger and bigger every day. However using the information from the accounts and attempting to control costs without understanding which parts of the company are driving revenues can lead to disaster. It is similar to pruning a rose bush with a machete versus pruning shears.

This is where holistic contractors bookkeeping services plays an important role. Many people find outsourcing as a remedy to cut costs and increase inefficiency in the contractors bookkeeping services department.

What Is Outsourced Holistic Contractors Bookkeeping Services?

The foundation outsourced holistic contractors bookkeeping services is regular bookkeeping skills. The rudimentary skills of bookkeeping and accounting that can be acquired by attending colleges, universities and some on the job training. This is all anyone needs to enjoy a decent living as a regular bookkeeper. It is also noteworthy that when someone says they have ten years of experience as a regular bookkeeper they really only have six months experience repeated twenty times.

Construction experience is a must for contractors bookkeeping services. There is no substitute for understanding construction at the cellular level and not just at the intellectual level.

Construction bookkeeping is deeper understanding of where to code bills, receipts, checks and credit card charges. This is make or break time for your construction company because this is foundation upon which all of your construction company's financial reports and job costing reports are built. Get this part right and you win, get it wrong and you will not know it until you are standing in bankruptcy court trying to figure out what went wrong.

Construction accounting is where the construction bookkeeping entries are regularly monitored by running test reports and benchmarking the results against past and present trends. When an anomaly is spotted the construction accountant reviews the construction accounting system and individual processes to find areas of improvement and then reviews the findings with the construction bookkeepers. The system is the solution because being process dependent, not people dependent is one of the keys to success all business ventures and most importantly in construction.

Business Process Management is where it all comes together and the contractor can understand where to trim costs without affecting overall performance and where to allocate resources to optimize profits. This is what every successful construction company does and it is a lot more fun knowing you are on the right path in advance.

Contractors who benefit the most from outsourced holistic contractors bookkeeping services are the ones who have annual sales under $1,000,000 and fewer than ten employees. They usually have a wife, girlfriend, neighbor or in some cases a bad bookkeeper which means they are forever caught between a rock and a hard place.

Thinking they cannot afford a professional construction accountant who could provide the guidance they need to operate and grow their company while in fact between what they are paying for in house contractors bookkeeping services and the money being lost from not understand the financial reports and job costing reports they could easily afford to have outsourced holistic contractors bookkeeping services.

Let’s take a closer look on the advantages and disadvantages of having an internal construction accounting department and outsourced construction accounting.

Having an internal construction accounting department gives the contractor full control of the contractors bookkeeping services system, including hardware, software and the accounting staff. It allows relatively easy improvement of the efficiency of information processing by implementing new processes. On the other hand it means contractors must reserve office space for the contractors accounting people, hire them, fire them, find replacements when somebody is sick and during vacations and holidays, arrange proper hardware and software etc.

As a result the contractors accounting department requires as much or more attention than the field projects without generating any new money. Additionally some well-paid specialists, like construction accountants and process development specialists may be not fully used, especially in smaller companies.

The remedy against the high costs of internal contractors accounting services department seems to be outsourcing of the contractors bookkeeping services. The contractors bookkeeping services company who treats construction accounting and finance as their main business activity will do everything that is necessary to make it efficient.

In particular they have specialists on the payroll to handle specialized services like finance management, quarterly tax returns, payroll processing, and other contractors bookkeeping services functions. It is certainly the best solution for the new contractor companies. They may concentrate on business development and leave the rest of affairs in the hands of professionals.

The financial reporting needs become more complicated when the construction company grows. The construction management requirements are bigger, in particular with respect to the reporting deadlines. It is similar to when you drive a car slowly; you have more time to make decisions. When it goes fast, every second or millisecond counts.

The same is with your construction company. In the beginning the contractor knows almost everything about the company. The time when the report comes from the contractors accounting services department is not really that important, because it only confirms what the contractors already knows.

With the growth of the construction company beyond the $5,000,000 annual sales the situation changes. The reports become major source of the information about the company. They must be more accessible faster and include more information and be accessible to project managers, foremen, and superintendents. The traditional system of collecting documents and sending them for processing to the external office becomes inefficient. It is necessary to process them at the location of the company and faster.

That is when a decision about major changes to the contractors bookkeeping services system is made. On this level the construction company requires an integrated system allowing processing each document only one time. The invoices and payment applications need to be in QuickBooks for contractors immediately and the payments made or received should be input immediately. Which means the construction company will be in a position to transition to an in-house construction accounting team.

QuickBooks Expert Specializing In Construction Bookkeeping Services