Search results for: “financial risk shifting”
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Reduce Financial Risk on Construction Projects: Step-by-Step Guide
Financial risk is an unfortunate part of every construction project, and it just gets riskier the further away a company is from the money. “Financial risk” on a construction project is an expansive topic, and includes problems with under-funded or underbid projects, contractor default problems, misappropriation of project funds, contractor failure, and more. A prudent construction…
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Risk-Shifting: The Battle Between Policy and Contract
It’s a fundamental tenant of American public policy that trade contractors and suppliers should be paid for their work, and should not be the parties required to bear the financial risk of construction projects. This belief that people should be paid what they are owed, and that the parties closest to the money should bear…
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Cash Management: What Smart Financial Managers Know
Today, at the Construction Financial Management Association (CFMA) Annual Conference, experienced construction industry financial professional, Steven Lords, is presenting an all day “mini-conference” on Cash Management. Cash management is a highly valuable topic for construction participants. There are obvious reasons why cash is important to any business, but there are additional layers of value in…
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Risky Business: How a Mechanics Lien Can Help
Financial risk is defined as the risk of losing money. It has long correlated with a rebounding economy and that is especially true in the construction industry. In a report by ENR, the “Construction March Jobless Rate Falls as Industry Adds 19,000 Jobs” stating that the jobless rate has gone down by 3.4% in the…
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Pay If Paid: Shifting the Financial Burden “Down the Chain”
Pay when paid, and pay if paid clauses are pretty common, but can be misunderstood – both in operation and purpose. Below, I’ll attempt to provide some answers and clarifications to common questions and misconceptions about these contract provisions. First, however, before pay when paid and pay if paid clauses are discussed specifically, the background of…