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By Procore Editorial staff
June 27, 2016
Quickbooks is one of the most widely used accounting programs in the construction industry. It houses important financial data, providing a daily snapshot of the company's health at any given moment. Until recently, however, all of this vital information had to be stored on an in-house network, which meant project managers and other team members in the field had no access to the hard numbers detailing the expenses associated with a particular job.
Due to this inability to effectively share essential data, it should come as no surprise that the No. 1 request coming from construction firms was gaining the ability to synchronize project data with their accounting software.
Thankfully, with Procore’s latest integration with Quickbooks, executives, managers, and accountants now have the means to seamlessly share and access all of these financial numbers in real time and on any mobile device. With this new feature, after you win a bid for a project, you can accelerate the buyout phase by pushing commitments straight to accounting, eliminating the need for delays and duplicate entries.
The integration of these previously mutually exclusive systems offers a vast array of benefits for construction firms of all sizes, from ensuring your company remains compliant with tax rules to making it easier to qualify for access to capital when it's needed most.
While the overwhelming majority of individuals working in the construction industry have an expert understanding of their particular building niche, the fact is that far too many don't know the business side. And one of the most important aspects of knowing the business side of a construction firm is paying strict attention to the taxation rules governing the company's income, expenses, payroll, and even health insurance options.
As noted by accounting and consulting firm, DoerenMayhew, the construction industry requires the single largest and most complex section of the IRS code. This stems from the fact that long-term contracts are the norm, making it difficult to forecast when profits will be realized for a particular project. For some construction firms, a single job can last several quarters or even years, and accurately tracking capital inflows and outflows can be a tricky endeavor.
Without the luxury to determine precisely when and how much income will be flowing into a construction firm, it's vital that there's a way to track past invoices, future receivables, and the consequent tax liabilities for all of this. Failure to do so can draw the unwanted attention of the IRS, and the last thing a construction firm wants is an audit hanging over the company. These are burdensome, time-consuming, and can eat up a considerable amount of resources––not to mention being the never-ending source of headaches and nightmares.
By integrating Quickbooks with your construction software platform, you can ensure your firm's bookkeeping is accurate, readily available, and easily accessible to everyone who needs it. This provides a layer of oversight and accountability that simply doesn't exist when your project management software and Quickbooks are isolated from one another.
In the same way the cycle of weather systems dictates when a construction company can or cannot get work done, so too does cash flow play an important role in how a firm operates. Without access to capital, some construction firms are unable to work with subcontractors, buy materials, or even hire workers.
As noted by the Minority Business Development Agency, a part of the U.S. Department of Commerce, access to capital is especially vital for construction firms, since these companies must acquire surety bonds to fulfill contractual requirements. These bonds are crucial for the bidding process, the actual work performed, and to assure final payment for the project. Gaining access to the capital needed for a bond can be difficult without all of the financial materials readily available and organized.
By integrating Quickbooks with Procore, you can monitor the firm's financials in real time and gain a much better understanding of the relationship between the direct costs of materials, labor, and subcontracting, and the indirect costs of supervision, tools, equipment, supplies, insurance, and other less easily recognizable expenses, like rework. Having the ability to compare and contrast these two operational pillars provides a better sense of your profit margins and allows you to make more accurate financial projections as well as informed on-the-site decisions.
By integrating one of the industry's most widely used construction accounting software applications with your project management platform provides increased efficiency by streamlining all communications and centralizing documentation in a single, easily accessible repository. Regardless of your physical location, you now have the ability to check on the company's financial health and ensure every team member is keeping each project on budget.
The Anatomy of a Request for Information (RFI)
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