Construction Accounting Mistakes That Are Quietly Costing You Money
Quick answer: The most common construction accounting mistakes are poor job costing, confusing margin with markup, waiting until a job finishes to check if it made money, and letting cash flow slip through the gaps between contracts. None of these are complicated to fix once you can see them. The trouble is, most contractors don't spot them until the bank balance already tells the story. A client of ours, a groundworks contractor based near Milton Keynes, once handed us a set of accounts that looked genuinely solid. Decent turnover, steady client list, nothing alarming on the surface. Then we dug into the job costing. Two of his biggest projects that year had actually lost money, and he'd had no idea until we pulled the numbers apart job by job. He'd been pricing his next quotes off gut feeling and last year's turnover, not off what those jobs had actually cost him. That's how construction accounting mistakes tend to work; they don't announce themse...