617: What Every Contractor Needs To Know About Their Financial Dream Team

This Podcast Is Episode 617, And It's About What Every Contractor Needs To Know About Their Financial Dream Team Navigating the world of finances can sometimes feel like trying to build a house without a blueprint. Between managing budgets, keeping track of expenses, and ensuring you're compliant with tax regulations, it's easy to feel overwhelmed. That's where your financial dream team comes in!    Having the right people by your side can make all the difference in staying organized and achieving your business goals. In this blog post, we'll chat about the key players you need on your financial team, what each role brings to the table, and how to find experts who truly understand the ins and outs of the construction industry.    Whether you're a seasoned pro or just getting started, building a reliable financial team will be a game-changer in achieving your financial goals and securing the future of your business.   How often have you hired someone expecting they knew how construction works, only to find out they did not know about it or your particular type of construction? Let's examine what each professional does to help with your needs.   The Role of a Construction Bookkeeper   Construction bookkeepers are the unsung heroes of construction companies' financial management. They organize everything and ensure that every penny is accounted for.    Ideally, a construction company's books are updated at the end of each business day so you can have an accurate account of your sales, expenses, and the bottom line. However, if your business is still in its early stages, without much financial activity or the funds to hire a bookkeeper, you should aim to reconcile your accounts at least once a week.   Here's what they typically handle:   1. Daily Transactions: Bookkeepers track daily financial activities, like invoices and expenses, ensuring all transactions are recorded accurately.   2. Accounts Payable and Receivable: They manage money coming in and going out, which is crucial for ensuring a healthy cash flow.   3. Payroll Processing: Construction bookkeepers often handle payroll, ensuring everyone gets paid on time and handling taxes and benefits.   4. Record Organization: They keep financial records neat, making it simple to pull reports or prepare for an audit when needed.   The Role of a Construction Accountant   Now, construction accountants step in with a more strategic approach! They not only keep the numbers in check but also help with long-term planning.   As a construction business owner, you'll want to work with an accountant from the very early days to help you with budgeting, forecasting, and decision-making – as well as for strategic tax advice and identifying opportunities to reduce costs and maximize profitability.    Many business owners think they only need to talk to their accountant once a year at tax time. But to gauge the health of your business - and make the most of your accountant's expertise - you should check in at least once a month.   Construction Accountants focus on:   1. Project Costing and Budgeting: Accountants track project expenses to ensure they adhere to budgets and help identify areas for improvement.   2. Job Cost Reports: They create detailed reports that provide insights into each job's costs, which helps manage profitability and make informed decisions.