At Business & Financial Solutions, we specialize in construction accounting services across Maryland, Virginia, and Texas. Our certified public accountants understand the unique financial challenges facing today’s construction industry, from job costing to contract management and industry-specific tax considerations.
Comprehensive Construction Accounting Services
Construction accounting is fundamentally different from standard business accounting. Revenue recognition follows project timelines, not calendar months. Costs shift between direct labor, materials, subcontractors, and overhead in ways that general-purpose bookkeeping software cannot track properly. Without construction-specific financial management, profitable projects can look like losses on paper — and unprofitable ones can hide until it is too late.
Our construction accounting team delivers specialized expertise in project-based financial management, helping general contractors, subcontractors, and specialty trade firms maintain accurate financial records while maximizing profitability.
Job Costing and Project Cost Accounting
We implement job costing systems that track every dollar flowing into and out of each project — direct labor, materials, equipment, subcontractor costs, and allocated overhead. This gives you real-time visibility into project profitability, not a delayed surprise when the job closes out.
Our accountants follow ASC 606 (Revenue from Contracts with Customers) and the percentage-of-completion method where applicable, ensuring your financial statements accurately reflect the economic reality of long-duration contracts. For smaller contracts or those with uncertain outcomes, we apply the completed-contract method when it better fits the circumstances.
Work-in-Progress (WIP) Reporting
WIP schedules are the backbone of construction financial management. Your bonding company requires them, your lender reviews them, and your business decisions depend on them. We prepare detailed WIP reports that show estimated costs to complete, earned revenue versus billings, and over/under billing positions for every active project.
Accurate WIP reporting does more than satisfy your surety — it flags problems early. A project showing significant underbilling may indicate scope creep or cost overruns that need attention before they erode your margin. We review WIP trends monthly so you can act on issues while there is still time to course-correct.
Bonding and Surety Support
Securing and maintaining your bonding capacity is essential to winning contracts. Surety companies evaluate your financial statements, WIP schedules, and working capital with a level of scrutiny that goes well beyond a standard CPA review. We prepare financial packages specifically formatted for surety underwriting, including:
- CPA-prepared or reviewed financial statements in the format your surety requires
- Detailed WIP schedules with cost-to-complete estimates
- Working capital and equity calculations
- Cash flow projections for upcoming project loads
- Personal financial statements for principals when required
Our clients consistently tell us that clean, well-organized financial packages help them secure higher bonding limits and better rates.
Construction Tax Planning
Construction companies face tax rules that differ significantly from other industries. Section 460 governs long-term contract accounting for tax purposes, and the interaction between book and tax methods creates planning opportunities that most general-practice CPAs miss. Our tax specialists help you:
- Choose the right tax method for each contract (PCM, CCM, or small contractor exemption)
- Maximize Section 179 and bonus depreciation on equipment purchases
- Properly classify workers as employees or independent contractors — a frequent audit trigger in construction
- Navigate multi-state tax obligations when you work across Maryland, Virginia, D.C., and Texas
- Structure entity types to protect personal assets and minimize self-employment tax
- Plan equipment purchases and trade-ins for maximum tax benefit
Retainage Management
Retainage creates a cash flow challenge unique to construction. We track retainage receivables and payables by project, ensuring you bill for retainage release promptly when contract milestones are met and that you are not holding subcontractor retainage longer than required by law. In Maryland, retainage on private contracts is capped at 10% under the Maryland Prompt Payment Act — we make sure you stay compliant.
Industries Within Construction We Serve
Our construction accounting clients include general contractors, electrical and mechanical subcontractors, plumbing firms, concrete and masonry companies, HVAC contractors, residential builders, commercial developers, and government contract construction firms. Whether you run a crew of five or manage $50 million in annual revenue, our systems scale to your operation.
Get Expert Construction Accounting Support
Your accounting firm should understand the difference between a T&M contract and a GMP contract, know why your bonding company cares about your current ratio, and be able to explain the tax implications of a change order. That is what we do.
Contact our construction accounting team at (855) 557-2222 to schedule a consultation, or contact us online.