You just wrapped up a profitable quarter. Your jobs are on schedule. Your clients are happy. Then your surety agent calls with news that makes your stomach drop: "We're reducing your bonding capacity by 40%." You pull up your WIP report, scanning the numbers. Revenue looks solid. Costs are under control. Profit margins are healthy. So what's the problem? Here's what most contractors don't realize: your surety isn't just reading your WIP report, they're interrogating it.  And

A contractor called us last month about a confusing problem. His WIP report showed his commercial renovation at 22% profit $74,000 in the green. But he'd maxed out his credit line and couldn't pay his concrete supplier. We found $68,000 in July costs that wouldn't hit his books until September. His plumber had worked three weeks but hadn't invoiced. Materials sat in "uninvoiced receipts" because his supplier batched invoices monthly. His WIP showed profit that didn't exist.

If your bonding agent has recently requested updated Work-in-Progress (WIP) reports, you may be feeling the pressure. It’s understandable to be concerned about how these reports could impact your bonding capacity, especially if you’re unsure about exactly what the underwriters are looking for. For small and mid-sized contractors (SMEs), your bonding capacity  is essential. It's the difference between competing for multi-million dollar projects or staying in the smaller league

Accurately tracking Work in Progress (WIP)  is crucial for financial transparency and effective project management on the construction income statement. WIP reflects the value of projects currently underway, including costs incurred and revenue earned to date. Properly managing WIP is the only way to accurately assess profitability, predict cash flow, and make informed decisions on bids and resource allocation. Construction projects often span months or years. This requires c

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Selecting the appropriate report can have a significant impact on monitoring the financial health of a building project. Two of the most...

A very important part of construction accounting is keeping track of work-in-progress (WIP) , which has a big impact on the bottom line...