With jobs to run, crews to manage, and clients to keep happy, becoming an expert in construction bookkeeping wasn’t initially on your to-do list…
Maybe you hired a bookkeeper that a friend recommended, or you brought on someone who knew the basics of data entry and payroll. For a while, that worked out just fine.
But now, you find yourself getting more involved than you’d like to be in the financial side of your business. You’re chasing down invoices that are months overdue. Your job costs aren’t painting a clear picture. And every time an audit or bonding request pops up, you’re scrambling to find the right paperwork.
We’ve seen this time and time again with our clients. It’s not that your bookkeeper is “bad.” Your company has just outgrown traditional bookkeeping. In fact, that’s exactly what happened with one of our clients.
When this parent company outside the construction industry launched a new construction division, they did what most growing businesses do. They hired a general bookkeeping firm to handle their numbers. And they quickly ran into some roadblocks…
Invoices sat unpaid for over a year. There were no systems in place for tracking billings or following up on payments. They struggled to gather the necessary documentation for final payment releases.
Eventually, they realized that a traditional bookkeeper wasn’t enough. They needed a construction bookkeeper with the services, expertise, and industry connections to be a true financial partner.
New Lyfe Accounting stepped in to take over their job costing process, building construction-specific SOPs for their accounting systems. We introduced checks and balances, cleaned up their AR to be within a 90-day window, and established a consistent monthly billing process.
With the support of a construction bookkeeper, they were also able to generate the documentation necessary for final payment releases.
While this story certainly showcases what NLA can do, it really comes down to this: there is a distinct difference between traditional bookkeepers and construction bookkeepers. Working with the right one can save your business. Below, we’re doing a quick comparison of what these two bookkeeping options have to offer.
Chart of Accounts
What a traditional bookkeeper can do:
Set up a basic Chart of Accounts using a template. This setup is functional for general businesses, but doesn’t accommodate the way construction companies track costs or manage their financials.
What a construction bookkeeper can do:
Customize a Chart of Accounts that’s built for job costing, overhead, and construction-specific categories, so your reports tell the full story of how a project is performing.
Job Cost Categories
What a traditional bookkeeper can do:
Record transactions under broad categories, providing a rough idea of your spending, but making it difficult to track job profitability.
What a construction bookkeeper can do:
Allocate every expense directly to a job, providing a real-time picture of where your money is being spent and where projects might be heading off track.
Project Data Entry
What a traditional bookkeeper can do:
Enter transactions, reconcile accounts, and generate basic monthly reports.
What a construction bookkeeper can do:
Manage full project accounting, including detailed data entry, reconciliations, and reporting, while providing operational support and regular communication. By providing all of this, your bookkeeper can easily produce a WIP report that accurately ties to your financial data.
Billing Knowledge
What a traditional bookkeeper can do:
Send standard invoices and track payments for basic billing structures.
What a construction bookkeeper can do:
Handle complex billing structures like progress billing, retainage, T&M, cost-plus contracts, and change orders, making sure every bill goes out accurately and on time.
Your Free Accounting Success Checklist
The first step to cleaner books (and less financial stress) is getting proactive with your approach to construction accounting. Our Accounting Success Checklist covers the steps any construction business should take for tidier numbers, job costing, operations, and more.
Payroll
What a traditional bookkeeper can do:
Process payroll for employees and contractors to issue paychecks and accommodate standard tax withholding.
What a construction bookkeeper can do:
Account for prevailing wage, union benefits, and certified payroll requirements, keeping you compliant with industry regulations and avoiding penalties.
Internal Team Involvement
What a traditional bookkeeper can do:
Rely on your internal team for oversight, clarification, and follow-up on financial tasks.
What a construction bookkeeper can do:
Provide a fully managed engagement with CFO oversight and an outsourced team, reducing the workload on your internal staff.
Problem-Solving
What a traditional bookkeeper can do:
Catch and fix mistakes after they’ve already impacted your numbers.
What a construction bookkeeper can do:
Proactively identify red flags, resolve issues early, and suggest solutions to keep projects and cash flow on track.
Software
What a traditional bookkeeper can do:
Work with general accounting software like QuickBooks or Excel, which may not fully integrate with your construction-specific project management tools.
What a construction bookkeeper can do:
Work within your construction-specific platforms like Procore, FOUNDATION, and Sage to ensure your accounting systems integrate seamlessly with your project operations.
Industry Relationships
What a traditional bookkeeper can do:
Handle your numbers in-house, but may be missing out on industry-specific connections that could further inform your financial management.
What a construction bookkeeper can do:
Leverage trusted relationships with third-party partners like surety professionals, banks, and CPAs to help you prepare for bonding, audits, and growth opportunities.
We’ll Manage Your Books So You Can Manage Your Jobs
At New Lyfe Accounting, we help you track what matters so you can stop chasing numbers, bid with confidence, and make smarter decisions (in real-time).
Whether you’re ready for a long-term construction bookkeeping partner or just need help solving an immediate roadblock, NLA provides completely customizable accounting solutions.
Get started by scheduling your free Strategy Session and Diagnostic, where we’ll help you gain a clear picture of your current financials.
Step 1: The Strategy Session
In this 45-minute meeting, we’ll get to know you, chat about your accounting challenges, and help pinpoint your goals. Ultimately, this is an opportunity for you to address your concerns with someone who understands the financial complexities of construction.
Step 2: The Diagnostic
After your Strategy Session, we’ll move to a high-level review of your actual financials. You’ll receive a Diagnostic Report of our findings. Inside this report, you’ll find our suggested priorities and service recommendations for your accounting needs and goals.
Solve For Today. Prepare For Tomorrow.
New Lyfe Accounting is a specialty firm helping small to mid-sized construction organizations navigate the industry’s unique financial landscape. From customized bookkeeping services to holistic CFO partnerships, we’re more than just an accountant. NLA operates as an extension of your team, strengthening your organization with financial services suited to your operational needs and your goals for growth.
