Jul 31, 2020
We have listened as our contractor clients have described to fellow contractors how "fast and easy QuickBooks is and what wonderful reports it generates," while the other contractor will describe in no uncertain terms what a piece of junk it is. The difference is in the QuickBooks set up. Two woodsmen will cut and stack vastly different firewood piles in a day if one uses a chainsaw as it was intended, and the other uses it as a cross-cut saw. Same tool, different result!
Taking the time to regularly review financial statements can help you assess and improve current performance, avoid risk, and make scalable future growth plans.
If your QuickBooks setup was done by a QuickBooks Expert in construction accounting and maintained correctly, you are riding high and living well! If not, we can fix just about any QuickBooks setup by performing a QuickBooks cleanup and importing all of the transactions. The Chart of Accounts is the foundation, and if your Chart of Accounts is not set up right, you will not have anywhere to put the transactions.
The QuickBooks For Contractors Reports inside the desktop version is easy to understand when you think of them this way:
#01 List Reports show things like customers, employees, and vendors. They can be sorted and filtered to provide contact information, including social media and demographics.
#02 Primary Financial Reports like Profit & Loss and Balance Sheet - how your construction company is doing from a big picture view (also known as the income statement). They can be sorted and filtered to provide more detail, and you can drill down into every transaction if you want to.
#03 Job Costing Reports like Profit & Loss By Job, Job Profitability, and Estimates Vs. Actual Reports. They provide you with the foundation reports to help you understand where your construction company is making or losing money—the 80/20 Rule For Construction Success.
#04 The Five Key Performance Indicator Reports - they are a unique combination of reports that we use to help our construction contractor clients get a Fast Easy Accounting view of their construction company in only five minutes a day. They are "The 5 At 5 For 5". If you will review these Five Reports at Five O'clock (or whatever time is best for you) for Five Minutes and do it every day in 90 days or less, you could see a dramatic improvement in your bottom line profits and cash flow.
We can assist you in getting a better understanding of your financial reports. We use QuickBooks for Contractors, and our customized QuickBooks setup is designed to facilitate built-in job costing reports plus being able to export to our Excel-based pay application nicely.
One of the most common questions we get is, "How involved do I need to be?" In all cases, the owner should have a "hands-on" approach, including paying the bills because we do not touch your money.
It is optional for our clients to have 24/7 access to their QuickBooks files and review their Key Performance Reports/financial reports daily. We continually improve processes to make other reporting methods available. With us handling the contractors bookkeeping services tasks, your in-house staff can work on more productive tasks and do what they do best.
When you understand your company's key financial data, you pave the way to smarter decision-making and sustainable growth for your construction business.
About The Author:
Sharie DeHart, QPA is the co-founder of Business Consulting And Accounting in Lynnwood, Washington. She is the leading expert in managing outsourced construction bookkeeping and accounting services companies and cash management accounting for small construction companies across the USA. She encourages Contractors and Construction Company Owners to stay current on their tax obligations and offers insights on how to manage the remaining cash flow to operate and grow their construction company sales and profits so they can put more money in the bank. Call 1-800-361-1770 or firstname.lastname@example.org