Property and Construction
Financial decisions for June
As a Property and Construction business, it is crucial to stay informed about important accounting matters that specifically impact your industry.
In the month of June, here are seven accounting considerations that are particularly relevant to businesses in the Property and Construction sector.
15th June 2023
Chloe Talbot-Swain See profile
1. Tax Deadlines for Construction-related Activities
June marks important tax deadlines for construction businesses, including filing and payment obligations related to sales tax, use tax, and other construction-specific taxes. Ensure you are aware of these deadlines and fulfil your tax obligations to avoid penalties and compliance issues.
2. Project Cost Analysis
June is an opportune time to review and analyse your project costs. Examine your budgeted costs versus actual costs incurred for ongoing projects. This analysis will provide valuable insights into cost overruns, potential areas for cost savings, and opportunities to optimise project profitability.
3. Compliance with Construction-specific Accounting Standards
The Property and Construction industry often has unique accounting standards and practices. Stay updated on any changes or updates to these industry-specific accounting standards, such as revenue recognition or lease accounting, to ensure accurate financial reporting and compliance.
4. Contract Review and Revenue Recognition
Review your construction contracts and assess the appropriate revenue recognition method for each project. Understand the requirements of recognising revenue over time or upon project completion, depending on the nature of the contract. Adhering to proper revenue recognition practices is crucial for maintaining accurate financial statements.
5. Equipment and Asset Management
As a Property and Construction business, you likely have a significant investment in equipment and assets. Use June as an opportunity to review your asset management practices, including depreciation schedules, maintenance costs, and tracking of equipment usage. Effective management of assets can help optimise costs and improve overall operational efficiency.
6. Subcontractor Compliance
If you engage subcontractors in your projects, ensure compliance with tax regulations, proper classification of subcontractors as employees or independent contractors, and timely filing of necessary forms such as Form 1099. Non-compliance in this area can lead to penalties and legal issues.
7. Cash Flow and Financing
Cash flow management is crucial in the property and construction industry. Evaluate your cash flow projections for the coming months, assess any funding needs, and explore financing options available to support your ongoing projects and business operations.
By proactively addressing these accounting matters in June, you can strengthen your financial management, ensure compliance, and drive success in the Property and Construction sector.
Remember, it is always recommended to consult with an accountant or financial advisor with expertise in the Property and Construction industry. They can provide tailored guidance and address specific accounting challenges that are unique to your business.
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