Construction contractors wear many hats. They work in management, marketing, human resources, sales, IT, and procurement. Among all of these responsibilities, accounting is perhaps one of the most demanding roles you’ll have to take on as a small business owner. It’s also one of the most important parts of your business. Accounting helps you track your finances, ensure compliance with regulations, and create vital financial projections that can be used to optimize your business decisions.
If you don’t have the time, energy, or skills to manage your small business accounting effectively, hiring a professional accountant is vital to your success. Check out the following tips and resources from Business Pop to learn how professional accountants can elevate your business!
Maintaining steady cash flow is a must for construction contractors. Being able to pay your bills on time can be the difference between your success and failure. If you’re just barely scraping by each month, hiring an accountant could be a great investment. Your accountant will work with you to identify cash flow problems and establish new systems to get money flowing in more quickly.
A professional accountant can help improve your customer contracts to reduce late payments and ensure you get the money you need for supplies, labor, and other expenses before the bills come due. Your accountant can also offer advice regarding payment terms, early payment discounts, and late payment fees to speed up your accounts receivable. ZenBusiness explains that your customer contracts should also include information about how the contract may be terminated, like when a client fails to pay at specified intervals.
Tracking business expenses is a constant, daily process. Hiring an accountant will ensure you don’t miss documenting any expenses that can save you money come tax time! Ask your accountant to help you set up a well-organized chart of accounts (COA) to provide structure and consistency to your financial records. Tracking expenses isn’t just important for reducing your taxes. Monitoring your expenses over time is important for determining where your business stands in comparison to industry standards. As a result, you’ll know whether or not your costs align with those of your competitors.
As Mobilization Funding explains, construction payroll tends to be more complicated than payroll for other business types. Construction workers’ pay rates often fluctuate as they move between jobs, and keeping track of payroll for a whole team can be incredibly challenging on your own. Hiring an accountant specifically to help with payroll will help with numerous facets of your business beyond simply ensuring your employees get paid. Your payroll professional can help with HR compliance, worker’s comp payments, payroll reporting, tax calculations, and more.
Of course, accountants also have a lot to offer small business owners at tax time. Your accountant will make sure you take all the small business tax deductions that are available to you so that you can reduce your tax bill significantly. Your tax accountant will need a variety of information to file your small business taxes, so be sure to keep your financial documents organized and easily accessible all year round. Keep track of expense records, loan information, income records, payroll data, inventory data, and asset information so you don’t have to scramble to find these documents when tax season rolls around.
As a small business owner, it’s important that you acknowledge the limits of your abilities. If you’re feeling lost when it comes to creating financial projections, managing payroll, or planning for tax time, don’t hesitate to hire an expert. A professional accountant can bring a lot of value to your contracting business!
Marissa Perez, author of the above article, has spent the last 10 years honing her marketing skills and now she wants to share her knowledge with those who have decided to take on entrepreneurship. She co-created Business Pop to provide insight and advice to those who aspire to succeed in owning a business.
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How A Professional Accountant Can Help Your Construction Business Succeed