Tag: Cash Flow
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Common Pitfalls in Construction Project Accounting
Contractors can take on a job after decent planning and enthusiasm, only to wonder what happened when they see a tiny profit or worse at the end of the project. Sometimes the reasons are elusive, but several of them show up in the post mortem time and time again. Below are some issues not immediately obvious…
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How to Find Out How Much Money Your Construction Company Can Borrow
Taking on new projects or jobs places a large cash burden on construction companies, particularly for subcontractors that are forced to “float” the project costs up front. Since the amount of cash needed will vary from day-to-day (based on the cash flow of the individual project, as well as the company’s overall cash flow from…
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Cash Flow: Things to Keep in Mind to Stay Ahead
Achieving profitability in the construction business can sometimes be more of a challenge than the work itself. Between the tight margins, managing change orders, the burden of retainage, and the typically long wait to actually get paid, making a decent profit on a construction project can sometimes seem more like a miracle rather than an…
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You Know What Is Expensive? Bad Debt
To illustrate how tight margins make bad debt even more expensive, we have actual data on bad debt losses from 7 new zlien customers. Each of these customers signed up with us in 2017, and each of them had recently written off a bad debt from a non-paying customer before they signed with us. We’re not…
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Construction Payment Technology Can Present Difficulties to Set Accounting Procedures
It’s no secret that the construction industry faces difficulties in payment and associated problems related to cash-flow management. Because of these difficulties, it’s usually important for a construction company accountant (or the person wearing the cash-management hat) to be exceptionally organized and follow set procedures, even if those procedures are sometimes pushed aside. The business…