Helping Your Contractor Clients Improve Profits

Source: Journal of Accountancy

Here are selected excerpts from J of A's checklist to help contractors:

• Workers Compensation--insurance agent should file for available credits such as Drug Free Workplace Credit, Safety Credit, and Contractors Premium Rate Credit.
• Make sure overhead rates used in estimates are not obsolete.
• Manage subcontractors and material suppliers--make sure client issues notices when they are behind schedule and considers exercising right of self-performance to keep projects on schedule.
• Partner with subcontractors and suppliers on bids asking them to accept smaller markups.
• Process change orders and back charges weekly. Don't wait until month end.
• Take advantage of loans through SBA's American Recovery Capital Loan Program, which assist with making payments of principal and interest on existing debt.

For the complete article, click here and read "CPAs Can Help Builders Increase Profits, Cash Flow."

From Journal of Accountancy, American Institute of Certified Public Accountants, December 2009, p. 24, http://www.journalofaccountancy.com/Issues/2009/dec.