What Makes Construction Bookkeeping Different?

Construction bookkeeping has its own unique industry-specific challenges and needs. We’ll share a quick overview and then a comparison list of regular bookkeeping vs construction bookkeeping. 

A construction firms typically aim to ensure that each project is profitable, which makes accurate job costing vital. The challenge is, projects are often large and one-off, so the numbers need to be right the first time and a company’s projects are typically distributed across multiple sites, and use a mobile workforce with fluctuating costs. Another unique bookkeeping need for construction is a bookkeeper will manage revenue recognition and billing for multiyear, changing projects. 

Regular Bookkeeping

Focuses on retail outlets, product lines or services with relatively simple revenue streams.

Production occurs in fixed locations.

Contracts are often standardized and payment occurs at a point in time.

Direct costs are relatively predictable.

Changes to contracted goods and services may be rare, depending on the business.

Construction Bookkeeping

Project-based: Focuses on individual projects, each with their own unique needs.

Production is decentralized, with a mobile workforce.

Long-term contracts tailored to each project, with complex payment schedules and revenue recognition rules.

Direct costs fluctuate and are unpredictable.

Change orders are the norm, especially for longer projects.

If you’re a construction company that needs to outsource to industry-specific experts, we would love to help! Get free bookkeeping estimate here: www.harquinbookkeeping.com/estimate.