The Best Accounting Software for Builders
As a builder, you constantly balance the demands of project management, budgeting, and financial reporting. Every day presents new challenges, but when it comes to managing your finances, you shouldn't have to struggle. That's where specialised accounting software comes in. In this article, we'll explore why software tailored to your industry can make a huge difference, which features to look for, and compare the best software options out there.
Why Builders Need Specialised Accounting Software
Managing finances for your building business can be a frustrating task. You may feel like your current software is not meeting all of your needs or that you're constantly jumping between tools to get everything done. Accounting software designed specifically for builders simplifies this process, making it easy to integrate financial management tasks with the rest of your project management.
Unique Industry Challenges
The construction industry has its own unique accounting challenges that require specialised knowledge and tools. These include job costing, progress billing, payroll for hourly and salaried workers, involvement with multiple subcontractors, and managing multiple projects simultaneously. All of these factors make accounting much more complex than it might be for other industries.
For example, job costing is a critical aspect of construction accounting. It involves tracking all of the costs associated with a particular project, including labor, materials, and equipment. Job costing allows builders to accurately estimate the cost of future projects based on historical data, which can help them win more bids and increase profitability.
Progress billing is another unique challenge faced by builders. Unlike other industries where payment is typically received after the work is complete, builders often bill clients in stages as the project progresses. This requires careful tracking of expenses and invoicing at specific milestones throughout the project.
Streamlining Financial Management
To save time and improve accuracy, many builders turn to specialised accounting software to streamline financial management tasks. With the right software, you can seamlessly track and manage all aspects of your cash flow, invoicing, and payments. This kind of smart integration will not only save you time but also reduce the potential for errors that could cost you money in the future.
For example, some accounting software solutions offer automatic bank feeds, which means that your transactions are automatically imported into the software. This eliminates the need for manual data entry, reducing the risk of errors and saving you time.
Another feature of specialised accounting software is the ability to generate detailed reports. Builders can use these reports to analyse their financial data and make informed decisions about their business. For example, you can create a report that shows the profitability of each project, allowing you to identify areas where you can cut costs or increase revenue.
Compliance and Reporting Requirements
As a builder, you must comply with various regulations, so compliance is a critical feature to consider when selecting accounting software. A well-designed solution should enable you to meet all relevant compliance and reporting requirements quickly and efficiently. This includes creating detailed audit trails and maintaining strict data security measures in today's ever-changing business landscape.
For example, the Construction Industry Scheme (CIS) is a UK government initiative that regulates payments made by contractors to subcontractors. Builders must comply with CIS regulations, which can be complex and time-consuming. Specialised accounting software can help you manage CIS compliance by automatically calculating and deducting the appropriate amount of tax from subcontractor payments.
In conclusion, builders face unique accounting challenges that require specialised knowledge and tools. Specialised accounting software can help streamline financial management tasks, save time, improve accuracy, and ensure compliance with relevant regulations. If you're a builder struggling with accounting, consider investing in specialized software to help you manage your finances more effectively.
Top Accounting Software Features for Builders
Job Costing and Estimating
Every builder needs to be able to track all costs associated with a construction job, including labor costs, materials, and subcontractor charges. Look for accounting software that offers job costing tools that help you keep track of all these expenses, ensuring that you don't exceed your budget.
When it comes to job costing and estimating, it is essential to have an accurate understanding of the costs involved in a project. This involves breaking down the project into smaller components and estimating the cost of each component. Accurate job costing and estimating will help you make informed decisions about the profitability of each project and help you avoid unexpected costs.
Progress Billing and Invoicing
Invoice management is another essential feature that you should consider when selecting accounting software. Not only does it help keep track of the costs of the individual jobs, but it also automates invoicing – ensuring you get paid for your work.
Progress billing is a vital aspect of invoicing for builders. It involves billing the client for work completed to date, rather than waiting until the project is complete. Progress billing helps you maintain a steady cash flow and ensures that you get paid for the work you have completed so far.
Payroll and Time Tracking
Managing payroll and employee benefits can be challenging. Accounting software that includes these advanced features will help you keep track of payments and pay overtime correctly. Look for software that supports time tracking to help manage overtime and other payments efficiently.
Time tracking is essential for builders, as it helps you keep track of the time spent on each project. This information can be used to calculate labor costs accurately and ensure that you are paying your employees correctly. Time tracking can also help you identify areas where you can improve efficiency and reduce costs.
Inventory and Asset Management
Asset tracking is essential if you want to know what your company owns and its value. Accounting software that integrates a comprehensive assets management system will allow you to manage your inventory comprehensively.
Effective inventory management is critical for builders, as it helps you keep track of the materials and tools needed for each project. By managing your inventory effectively, you can reduce waste, avoid stockouts, and ensure that you have the materials and tools you need to complete each project on time and within budget.
Integration with Construction Management Tools
Look for accounting software that can integrate with construction management tools, such as bid management software. This integration will help keep costs under control and improve efficiency.
Construction management tools can help you manage all aspects of your projects, from bidding to completion. By integrating your accounting software with these tools, you can streamline your processes and reduce the risk of errors. This integration will help you manage your projects more effectively and ensure that you are delivering high-quality work to your clients.
Comparing the Best Accounting Software for Builders
The following accounting software options have been tailored specifically to the needs of builders, offering features that are tailored to the construction industry:
Thriday is a popular accounting software that combines banking, accounting and tax. Thriday offers a range of comprehensive features including invoices, receipt scanning, transaction categorisation, payments and BAS lodgment.
BuilderTREND's all-in-one software is made exclusively for the construction industry. Apart from traditional accounting features, it has all the project management features you'll need, including document management, scheduling, budgeting, and communication features. The software can also integrate with QuickBooks if needed.
Procore serves the broader construction industry in addition to accounting. It includes integrated accounting software features designed to save money by connecting project finances with project management. The software can integrate with over 200 solutions and has a strong focus on innovation.
Choosing the right accounting software for your needs isn't a decision to be taken lightly. Finding a solution that meets your specific business requirements is crucial to successful financial management. By understanding the unique accounting challenges associated with building projects, evaluating software features carefully and comparing the best accounting solutions available, you'll be well on your way to finding the best software for your business.