When you’re hiring a bookkeeper for a construction company, look for someone who has done job costing before, knows your accounting software, and has handled the kind of payroll you run. Then test them on your own transactions. A general small-business bookkeeper can keep the bank account balanced and still get every job report wrong.
This guide covers what a construction bookkeeper does, what to look for, in-house vs. remote, the questions to ask, and when you need more than a bookkeeper.
What a construction bookkeeper does
- Enters and pays bills, and codes each one to the right job and cost code
- Sends invoices and pay applications, and tracks retainage
- Records deposits and follows up on collections
- Processes payroll, including union or certified payroll reporting if your work needs it
- Reconciles bank and credit card accounts every month
- Keeps lien waivers and subcontractor insurance certificates on file
What to look for
- Job costing experience. Ask how they’ve coded costs by job and cost code before. It’s the skill general bookkeepers most often lack.
- Your software. QuickBooks, Sage 100 Contractor, Sage 300 CRE, Foundation and Sage Intacct each handle jobs differently. Someone who already knows your system gets up to speed much faster.
- Payroll that fits your work. Union reporting and certified payroll for public jobs take experience.
- Attention to detail. One cost on the wrong job throws off two job reports and your WIP schedule.
- Willingness to ask. A good construction bookkeeper calls the project manager when an invoice doesn’t match a job, instead of guessing.
In-house, remote or outsourced?
| In-house bookkeeper | Remote or outsourced bookkeeping | |
|---|---|---|
| Where they work | In your office | Mostly remotely, in your accounting system |
| Cost | Salary, payroll taxes and benefits | A monthly fee for the work you need |
| If they leave | You start over, and often nobody else knows the system | A team covers the work |
| Best for | A full-time workload and someone in-house to supervise them | A smaller workload, or no one in-house to review the books |
Either way, someone has to review the bookkeeper’s work. In a small company that’s often the owner, who doesn’t have the time. That review is a controller’s job.
10 questions to ask before you hire
- Which construction companies have you kept books for, and what kind of work did they do?
- Which accounting systems have you used for job costing?
- How do you code a bill that covers more than one job?
- How do you track retainage, both what you bill and what you owe subs?
- Have you prepared pay applications or AIA billing?
- Have you handled union or certified payroll?
- What do you do when a vendor invoice doesn’t match the purchase order?
- How often do you reconcile the bank and credit card accounts?
- What reports would you send me each month?
- Who reviews your work, and who covers when you’re out?
Then give them a short test: a few real bills and a payroll, and see how they code them.
Red flags
- They’ve never coded costs to jobs.
- They want to change your software before they’ve learned it.
- They can’t explain retainage.
- The bank reconciliations are months behind and they don’t see a problem.
- Nobody reviews their work.
An example: one bill, two wrong job reports
Here’s a simple example. Say a $12,000 lumber bill covers two jobs: $8,000 for Job A and $4,000 for Job B. If the whole bill goes on Job A, Job A looks $4,000 worse than it is and Job B looks $4,000 better. If that happens every month, the WIP schedule shows profit fading on one job and growing on another, and nobody can say why. A bookkeeper with job costing experience splits the bill when it’s entered. A controller catches it at month-end if they don’t.
When you need more than a bookkeeper
A bookkeeper records transactions. Once your bank or surety asks for reports, your WIP schedule needs to tie to the financials, or the books keep closing late, you need someone to oversee the bookkeeper: a controller. Read signs you’ve outgrown your bookkeeper and CFO vs. controller vs. bookkeeper.
How we help
We do construction bookkeeping remotely, in your software, on a daily, weekly or monthly schedule. We can also oversee your in-house bookkeeper as your outsourced controller. In New Jersey and New York we can be in your office part of the week. See all our construction accounting services.
FAQs
What should I look for when hiring a bookkeeper for a construction company?
Job costing experience, knowledge of your accounting software, and payroll experience that fits your work, such as union or certified payroll.
What questions should I ask a bookkeeper before hiring?
Ask which construction companies they’ve worked for, how they code costs to jobs, how they track retainage, which software they know, and who reviews their work.
Should I hire an in-house or a remote bookkeeper?
In-house if you have a full-time workload and someone to supervise them. Remote if the workload is smaller, or you want a team that covers when someone is out.
What’s the difference between a construction bookkeeper and a regular bookkeeper?
A construction bookkeeper codes every cost to a job and cost code, tracks retainage and pay applications, and keeps the job reports your WIP schedule depends on.
When do I need a controller instead of a bookkeeper?
When the books close late, the WIP schedule doesn’t tie to the financials, or your bank or surety starts asking for reports.
What certifications should a bookkeeper have?
None are required. Two worth asking about are the Certified Bookkeeper (CB) credential and QuickBooks Certified ProAdvisor if you use QuickBooks. For a contractor, hands-on experience with job costing, retainage and pay applications matters more than any certificate.
