How to Choose the Best Accounting Software for Your Construction Company?

In the construction trade, there are specific needs for accounting purposes; thus, one of the most important business decisions to make is choosing the right online bill maker. When it comes to tracking job costs or processing subcontractor payments, specialized accounting software for construction can quicken up things, improve accuracy, and deliver useful business insights. Read on to learn how you can select the best accounting software for your construction company and make bills online.

Key Features of Construction Accounting Software

When you begin studying construction accounting software, you will quickly notice that it ranges from simple billing and payment tools to comprehensive systems with capabilities such as job costing and payroll to full-fledged ERP platforms with several bells and whistles.

Common construction accounting software features include:

Accounts Payable (A/P)

The whole range of accounts payable capabilities should involve invoice management, payment processing and vendor administration. A nice system is one that enables you to automate your workflow and approval process.

Accounts Receivable (A/R)

Even for the most advanced construction accounting software, construction A/R is still a nightmare. Find a solution that tracks billings for multiple clients, creates bills, includes standard AIA billing forms, and provides an audit trail. It is important to note that from a subcontractor’s perspective, most accounting software does not do justice to the A/R process.

Financial Reports and Analysis

Report functionality ranges from simple balance sheets to sophisticated profitability analyses. The best choice will be income statements, gross profit reports, cash flow statements, and dated accounts receivable reports, among others, as well as budget variance explanations and labor productivity numbers available at your fingertips.

Job Costing

To preserve earnings, it’s important to choose accounting software that has job-costing functionality. Project managers must be able to check in and keep track of labor, material, and equipment costs from wherever they are.

Cash Flow Management

Considering how long construction payments take, pre-planning your cash flow is necessary to avoid being broke. Although there are numerous claims that some construction accounting software can address this issue, most systems cannot handle the subcontractor’s specific invoice procedure; as a result we suggested using an accounting software which interacts with Siteline for the most accurate and comprehensive cash view.

Payroll & Timekeeping

Accounting software should include timecard entry and processing features as well as prevailing wage management and payroll reporting if you want it to be used in managing your company’s payroll.

Statistics on Construction Companies Using Accounting Software

Why Do Construction Companies Need Accounting Software?

There are specific financial challenges experienced by construction companies that range from handling varying project costs, managing multiple subcontractors to huge inventory control. Ignoring traditional methods usually leads to complex situations, mistakes and non-effectiveness.

To tackle these issues, construction accounting software has been developed. It boasts functionalities such as job costing, progress billing, and change order management, which allow tracking of project expenditures accurately, simplifying invoicing processes, and upholding financial regulation within the sector.

Adopting construction accounting software helps firms have better control of their finances, thereby improving profitability and decision-making capacities based on informed choices being made, hence the success and sustainability of their projects.

Vendor Q&A Checklist

We recommend you create a list of questions to ask your sales representative. Here are a few options to consider.

Pricing

• Does the price include all features?
• How many users are covered by our subscription?
• Are there any additional costs associated with integrations? If so, what amount?
• What are the costs of deployment and onboarding?
• Is normal customer support an additional cost?
• Are there any tiers of costs?
• Does the pricing include limitless invoices, reports, and so on? Is there a usage cap?

Onboarding

• What does your onboarding and implementation strategy look like?
• How long does it take to get the software up and running?
• What are some typical implementation steps?
• How much time should we spend on onboarding?
• How do you ensure that we follow the onboarding and implementation timelines?
• How do you assess the success of your customer onboarding?
• What extra resources are required to implement your software?
• Do you provide continual training?

Usability

• Is your software designed for subcontractors’ accounting processes?
• Can we connect your accounting software to our CRM? What about our bid management system? What additional tools are you integrating with?
• What accounting operations can we automate using your software?
• Does your system provide mobile access?
• How do field and project managers use the system? Do you have authorization levels?

Create questions with your team that will meet your company’s specific needs. Choosing construction accounting software is an important decision; do your research thoroughly.

Wrapping It Up

Understanding your business needs, evaluating the Online bill maker’s usability and integration capabilities, considering cloud-based options, researching the vendor’s reputation and support, checking for scalability, and taking advantage of free trials are all steps in selecting the best accounting software for your construction company. By taking these variables into account, you may choose software that simplifies operations, improves accuracy, and gives the insights required to manage a successful construction business.

FAQs

Which accounting method works best for a construction company?

In many circumstances, PCM is the mandatory method of income reporting. As a result, PCM is the most popular construction accounting approach.

What is construction accounting software?

Construction accounting software provides contractors with financial management tools to help them manage their construction business finances.

What kind of accounting is used in construction?

Construction businesses can pick from several accounting techniques, including cash, accrual, percentage of completion, and finished contracts.

Which software is most commonly utilized in the company?

Enterprise resource planning (ERP) software enables businesses to combine all management aspects of inventory management, accounting, CRM, human resources, advertising, and other areas in order to share data.

What are the five key accounting principles?

These include the accrual principle, the matching principle, the historical cost concept, the conservative principle, and the idea of substance over form.