Construction accounting in Tampa, FL

accounting services for construction companies in Tampa

As the owner of a construction business, you may already know that if your accounting processes are ineffective, it can lead to dire consequences for your operations. These include losing track of project progress, failing to identify cost overruns, and developing a lack of trust from creditors.

At Retanaco Accounting, we understand construction accounting thoroughly and the efficiencies required to provide high-quality accounting, cash flow projections, reporting financials, and more. Our team of highly adept accounting professionals stands out because of our in-depth knowledge of industry best practices and appropriate technology. So, while you’re focusing on achieving growth for your business, we ensure no financial obstacles land in your path.

Focus on Building Your Business

We know that the skills and experience you achieved from the job site enabled you to build your construction company. But stepping into the shoes of a business owner is like entering a workspace that’s entirely unfamiliar. This means having to acquire new skills and familiarizing yourself with the practices required to take your company to the next level. But with so many uncharted territories you’ve yet to get familiar with, is it worth acquainting yourself with accounting and tax practices from scratch? Hire our construction project accounting services instead to save time while utilizing our industry experience to amplify profitability and shrink taxes.

Benefits of Bookkeeping and Accounting for Construction Contractors

Retanaco Accounting serves contractors from all parts of the industry, be it commercial or residential developers, managers, and even contractors/subcontractors. Our mission is to provide accounting for contractors that will help them supercharge their business and expand their bottom lines.

Construction and contractor businesses like yours can rely on Retanaco’s accounting, consulting, tax, and payroll services to strengthen your competitive position and establish a more efficient, profitable, and compliant business. You can count on our devoted construction accounting services team for:

  • Personalized surveillance and expert-level direction at every stage: Benefit from continuous collaboration, communication, and partnership to avoid surprises and ensure work stays on schedule.
  • Specialized tax guidance: Get a clear picture of complex tax regulations to reduce liabilities, handle tax controversy, and qualify for the most favorable credits and incentives.
  • Effective accounting and reporting that demonstrates your financial stability: Retanaco can assist you with proving your business’s profitability and compliance to bonding agents and lenders so you can acquire funding for and execute more projects.
  • Strategic planning and useful insights: We map out a pursuable blueprint for your short and long-term goals. Be it financial management and cost control or expanding to new market environments, our objective is to help you reach new heights.

With endless regulatory and political pressures revolving around the construction sector, it’s crucial to be backed by an accounting firm that paves the way for you to move forward with confidence. We offer accounting for construction contractors centered around their ambitions, easing everyday pressures and driving persistent business growth.

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Top Accounting Strategies for Construction Businesses

With the construction industry booming more than ever, it’s time for your business to opt for strong financial management. As the owner of a construction business, you’re not a newbie to the rapidly changing regulations of the industry.

Plus, with so much on your hands, it’s natural to miss the latest updates or not be able to give the financial side of your business due attention. Unfortunately, this is not an aspect of your business that you can take lightly.

Construction accounting, when tackled effectively, can make a significant difference in your business’s growth and success. But before you partner with a company that offers accounting for contractors, take a look at our guide below to understand what you should be looking for in your future accounting acquaintance.

Why do You Need to Hire a Professional for Construction Accounting?

Regardless of the business type, accounting is a prerequisite to establishing the foundation for success and profitability. This is even more prevalent in the construction industry, owing to its unique bookkeeping methods and financial challenges.

The major difference between a construction business and most other businesses is that they’re primarily project-based. This means there will be irregular cash flow since it’s highly unlikely that all your projects will end and be paid for on the same date.

If this is not enough to affect your company’s financials, there are some other factors that make things more challenging. These include complicated cost structures, tracking change orders, managing retainage, long pay cycles and keeping up with numerous contractors.

That’s why it’s important to practice effective accounting and leave it to the professionals. Their expertise is the glue that brings your business’s financial pieces together and ensures there are no cracks for your profits to slip through.

Methods for Construction Project Accounting

Accounting for construction contractors can be done in four ways. Your business’s type and size will determine the accounting method that would be the best for it. Our guide below will show how the method you select can affect your financial statements, such as income statements, cash flow statements, and balance sheets.

Cash Method – If you’re a small business earning an annual revenue of less than 30 million, IRS publication 538 suggests that the cash method is the most suitable accounting method for you.

This revenue limit is adjusted to maintain pace with inflation and represents the average of your previous three year’s revenue. Since the method is easy to implement, it’s recommended for small contractors; however, it does come with its fair share of disadvantages.

Firstly, you can only recognize revenue after it exchanges hands. This makes it challenging to predict incomes and expenses. Furthermore, most financial institutes and banks reject financial statements that use a cash basis for lines of credit or loans.

Accrual Method – The accrual method enables you to see a more accurate financial outlook since revenue can be recognized when you bill your client or when your supplier or vendor bills you, irrespective of when the money is actually received or paid.

This enhances your financial statement’s accuracy and enables you to better forecast and strategize cash flow versus just reporting profitability.

In contrast, the biggest drawback of the accrual method is that you’ll have to pay taxes on income that has yet to be received. Moreover, there are always chances that it may never be received if the project owner encounters financial problems or the project itself falls apart.

Percentage of Completion Method – With the percentage of completion method, you can recognize revenue and expenses at the time they are earned or incurred in relation to the percentage of work you’ve completed. For instance, if you invoice a client, the revenue will be based on the extent of work you’ve put in place in that specific period.

Completed Contract Method – This method is mainly adopted by residential builders or contractors who are working on long-term projects. Here, the revenue and expenses are accounted for once the project reaches completion.

Accounts keeping track of construction costs, a billing account, and an accounts receivable account would still need to be maintained while the project progresses. At the end, you calculate the aggregate costs and expenses. This is not a popular method among contractors.

5 Accounting Practices Needed by Your Construction Business

Project Cost Estimation and Budgeting – Budgeting and estimating project costs accurately are crucial components when you’re looking for accounting for contractors. They help direct projects toward profitable and timely completion while ensuring that the interests of all stakeholders are safeguarded.

Another factor that plays a major role in your project’s success is a precise estimate of the project completion date and the relevant timeline. This estimate offers assurance that the project can be completed within the forecasted time and resources.

Job Costing and Reporting – Job costing involves tracking revenues and costs related to each project. With accurate job costing, you can understand each project’s profitability, create a comparison between actual costs and estimates, and spot areas of inefficiency or unnecessary costs.

Cash Flow Management – Given the construction industry’s complex elements like long project cycles, fluctuating demand, and upfront labor and material costs, cash flow management is paramount for a construction business. By administering their cash flows properly, construction companies can be confident about having the funds required to sustain projects, invest in expansion opportunities, and navigate other business areas.

Tax Planning and Compliance – The tax issues construction companies face are endless and, therefore, require careful management and preparation. With proper planning, companies can easily follow tax laws, benefit from tax savings and incentives, and avoid penalties.

Payroll for Construction – With labor laws and regulations becoming more intricate with time, especially those associated with construction companies, payroll services ensure compliance and evasion of potential penalties.

Additionally, they automate repetitive tasks like time tracking and data entry. Not only does this reduce manual intervention, leading to fewer errors and inaccuracies, but it also cuts down on processing times and paperwork.

Unlock Expert Construction Bookkeeping Services For Your Business

When it comes to contemplating whether you should outsource accounting services for your construction business, the choice is obvious. This is especially true if your skill set does not align with the financial needs of your company. Plus, with accounting and tax regulations getting more stringent, you need an accounting firm with rich industry experience to ensure your business remains compliant with industry laws.

At Retanaco Accounting, we cater to all the accounting needs of your construction business. We strive to create a top-notch financial position for your company so you can maximize profits while minimizing risks and fulfilling your financial goals.

How do we Simplify Accounting for Contractors?

Through our wealth of experience in handling the accounting aspects of construction businesses, we’ve come to develop an all-encompassing understanding of the construction industry. This is also how we’ve come to realize that the construction industry is subject to rapid changes and evolvements, with new tax regulations and laws being introduced one after another. For a construction business, this means staying updated with the latest financial developments and tax legislation or facing the consequences.

As your accounting partner, we ensure that you never miss an update and employ our industry knowledge and expertise to plan the most efficient and compliant cash flow management, payroll for construction, CIS guidance, and other tax and accounting solutions that will help your business thrive.

Time is Money, And We Help You Make The Most Of It

In the construction industry, time equals money, and this is where we step into the picture with our accounting support to manage the financial segment of your business. Hiring several providers for this purpose can lead to poor communication, frustration, extra work, and ultimately lost time. However, outsourcing your construction bookkeeping services through an experienced company such as ours is like putting all your business’s financial concerns in a bottle and trusting that we will use our seasoned expertise to magically convert them from turbulent waves into tranquil waters, giving you all the time you need to divert your attention over what actually matters – your business.

construction accounting Q&A

What is the role of a construction accountant?

Construction accountants will analyze, manage, and update your business’s financial information. Since most construction businesses are project-based, a large chunk of the accountant’s work revolves around job costing tasks to track, analyze, and estimate project expenses. Lastly, they can also help you comply with the regulations of the industry.

I can manage my bookkeeping so far; why should I switch to Retanaco Accounting?

Every minute that you spend on your business’s bookkeeping, reporting, and payroll is time that could have been utilized in acquiring new projects or clients. Plus, wouldn’t it be better to employ your time where you’re most productive?

What makes Retanaco Accounting qualified to handle my accounting?

Our richly-trained accountants are familiar with the unique challenges of the construction industry and divert their skills toward creating a solid accounting system with skills, discretion, and attention to even the tiniest detail.

What construction project accounting services do you offer?

Our service catalog for construction companies includes:

  • Outsourced accounting
  • Bookkeeping
  • Financial controller
  • Sales tax compliance
  • Payroll for construction
  • Preparation of financial statements for tax season
  • Project accountancy
  • Quickbooks training
  • Quickbooks desktop to online conversion
What is your pricing structure?

With Retanaco Accounting, you get to save a significant amount of cost that would otherwise be spent on hiring an in-house accounting team. Moreover, we offer consultations to all our partners where we understand their business and accounting needs and then quote the most affordable and suitable price for our services.

For what other industries do you offer your accounting services?

Apart from construction companies, we extend our personalized accounting services to real estate, retail/franchise, SaaS, and non-profit sectors.