Accounting Services for
Construction Businesses
Control project costs, track true profits of each site, ensure uninterrupted cash flow, and prepare financial statements for credit approvals.
- Know Profit/Loss Per Project
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- Manage Revenue by Milestone
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- Ready for L/G Approvals
Separate Construction Costs
Close Every Site Confidently
Stop guessing your profit margins! We help you implement Job Costing to instantly plug material and labor cost leaks.
Chronic Problems Contractors Face
The construction business cycle is full of risks. Being good at construction management alone might not be enough to survive if back-office financial controls are missing.
Lots of Work, Missing Profits
Taking on multiple projects, spinning money from the left pocket to the right, and ending up with nothing when the job is done.
Ballooning Costs
Unable to control materials and labor. Lack of clear Budgeting (BOQ) causes on-site expenses to exceed targets.
Delayed Payments
Unable to draw down milestones as planned. Retention money issues causing cash flow crunches.
Insufficient Cash Flow
Having to advance labor and materials, but income arrives later than scheduled, leading to high-interest borrowing.
Unknown Profit per Project
Accounts are all mixed together. Never knowing which site is profitable and which is secretly eating company capital.
Hard to Get Bank Loans
Poor financial statements and incorrect revenue recognition lead to rejected OD or Letter of Guarantee (L/G) applications.
Why Does Construction Need
Specialized Accounting?
The construction business has a completely different nature from trading businesses because "revenues and costs occur per project site."
Looking only at the "total net profit of the company" in financial statements may not reflect true performance, because highly profitable projects might be subsidizing heavily losing ones. Without a Job Costing system, you will never uncover this truth.
Good Construction Accounting Must Separate Data
- Recognize revenue based on Percentage of Completion (POC)
- Separately record materials and subcontractor labor per project
- Manage Retention money tightly so it doesn't get lost
5 Life-or-Death Metrics Contractors Must Know
Turn historical accounting data into a navigation radar for your next bid.
1. Gross Profit per Project
Gross profit separated by project. Know clearly whether piping, structural, or finishing work generates the highest profit for your company.
2. Cost Variance
Actual costs compared against the established budget (BOQ) to pinpoint why on-site expenses are inflating and plug leaks immediately.
3. Backlog Value
The value of work in hand that has not yet been delivered and recognized as revenue, helping you plan ahead for when to bid for new jobs.
4. DSO (Days Sales Outstanding)
Average collection period. If debtors or clients pay slower than the cycle, the company risks paper bankruptcy.
5. Cash Flow Position
Circulating cash flow status—the number one priority that ensures contractors can pay worker wages and buy materials without resorting to loan sharks.
Where Cash Usually Sinks
- 1 Uncollected Accounts Receivable (A/R)
- 2 Forgotten Retention Money
- 3 Advances to Subcontractors
- 4 Idle Construction Materials piled on site
Full Hands,
Empty Pockets?
Many construction businesses fall into the trap of having "Paper Profits but No Liquidity." At year-end, statements show profit triggering tax liabilities, but there’s no cash in the bank to pay worker wages.
This is a Cash Flow problem. Our CFO Advisory service steps in to set up Cash Flow Projections, predicting inflows and outflows for each project phase, so you know exactly when to prepare reserves in advance.
Construction Financial & Accounting Management Services
Construction Bookkeeping
Record accounting via Job Costing and recognize revenue based on Percentage of Completion (POC).
View DetailsContractor Tax Planning
Manage VAT (7%), 3% Withholding Tax, and rigorous handling of stamp duties on employment contracts.
View DetailsCFO Project Profit Analysis
Analyze Gross Profit per site, compare actual budgets against BOQ to plug leaks.
View DetailsL/G Loan Prep
Build strong, credible financial statements to apply for Letters of Guarantee (L/G) and OD lines.
View DetailsOn-site Payroll Systems
Manage daily wage payments for site workers, monthly salaries, and accurate social security submissions.
View DetailsInternal Audit
Implement controls and approvals for material purchasing (PO) to prevent employee fraud and bid-rigging.
View DetailsTransparent Profit Analysis
Per Project
No more wondering "Am I working for free?" We generate detailed cost reports per project, letting you see clearly:
- Which projects are profitable and driving Cash Flow.
- Which projects are operating at a loss and carrying the most Overhead.
- Which projects require immediate improvements in on-site material procurement.
A/R & Cash Flow Management
Many construction businesses fail due to lack of liquidity, not lack of work. We help set up systems to track milestone billing and follow up on Retention money so your funds don't get trapped.
Prepare for Credit Lines & Loans
Growth requires capital. OD lines, Letters of Guarantee (L/G), or revolving credit all require beautiful and credible historical financials. We are ready to shape those numbers for your company's future.
Loan Advisory Services →Covering All Construction & Engineering Sectors
Construction Company in Lampang Expands L/G Line Successfully
The company had numerous government bids in hand but lacked liquidity, and their Letter of Guarantee (L/G) limit was maxed out. The SiamAccount team revamped their accounting system to generate project-separated financial statements, analyzed Cash Flow Projections, and negotiated with financial institutions. As a result, the company successfully increased its revolving credit line and took on larger-scale projects within just 3 months.
Frequently Asked Questions (FAQ)
Q:How should construction businesses correctly recognize revenue?
A:Revenue should be recognized based on the Percentage of Completion (POC), evaluated by comparing actual costs incurred against the total estimated costs. This method accurately reflects performance in each accounting period and strictly complies with Revenue Department standards.
Q:Why must contractors use Job Costing?
A:To prevent using funds from Project A to pay for Project B's labor, creating a tangled mess. Separating costs lets executives know the true profit/loss of each site and allows immediate intervention if material/labor budgets inflate.
Q:What types of taxes do construction contractors face?
A:Primarily: 1. Corporate Income Tax, 2. Value Added Tax (VAT 7%) on delivered milestones or received payments, 3. Withholding Tax (3% for contracting services, 1% for purchasing materials with services), and 4. Stamp Duty (0.1% of the construction contract value).
Q:What kind of financial statements are needed to request a Letter of Guarantee (L/G)?
A:Financial institutions will look at transparent historical balance sheets and P&L statements, focusing heavily on the Debt-to-Equity (D/E) Ratio, financial liquidity, and Backlog (value of work in hand). Our team can help prepare these statements to meet banking standards.
Q:Should mid-sized construction companies have an Internal Audit system?
A:Absolutely! Construction businesses involve high-value material procurement. An Internal Audit system prevents leaks from procurement bid-rigging, inflated claims, or overlapping subcontractors, saving the company massive amounts of money.
Providing Construction Accounting & Financial Advisory Across the North
We are the financial partner for contractors and real estate developers in major cities, preparing your company to bid for government projects smoothly.