6 Construction Accounting Best Practices From BILL

Construction finance teams play a crucial role in the growth and success of the business. They help with job costing, materials purchasing, sub-contractor payments, progress billing, and more. But it isn’t easy to get a clear picture of where you stand at the end of each month. In this guide from BILL, an integrated software solution for all your financial operations, we’ll share some best practices for construction accounting.

1. Use specialized accounting tools

Ensure the accuracy of your financials by investing in construction accounting software and financial automation tools. Look for solutions that are designed for the construction industry and will integrate with your bidding or job costing software.

2. Implement a cost-coding system

A cost-coding system can help you keep track of expenses by jobsite, including supplies, labor, subcontractors, and more. Assign unique codes to each cost category for better visibility and cleaner financial statements.

3. Reconcile accounts regularly

The most successful construction companies close the books and reconcile accounts each month. This can help you catch errors, prevent fraud, and better manage cash flow.

4. Track construction project costs in real time

Staying on budget is the key to building a good reputation. Spend and expense management software like BILL’s can help you see purchases as they happen, set clear budgets, and track everything in real time.

5. Prepare accurate and timely progress billings

Progress billing is a best practice because it allows you to collect payment more steadily. BILL’s accounts receivable tools can help you stay on top of invoicing and maintain a steady cash flow.

6. Review financial reports

Preparing regular financial reports (whether quarterly or semi-annually) will help you identify cost trends, assess profitability, and make informed business decisions. Look for financial management software that integrates with your accounting tools to sync automatically and make reporting faster and easier.

Manage construction contractor billing and payments with BILL

Construction accounting is complex, and that’s why many construction finance teams choose BILL.

BILL's financial automation platform helps accounting teams streamline their AP, AR, spend, and expense processes, giving them more control over cash flows and more visibility in their financial reporting.

By automating your financial operations, you can:

All of which makes your construction accounting a lot easier.

Learn more at https://www.bill.com/solutions/construction.