Construction Contractors: Non-Revenue and Non-Lease Accounting Considerations

Overview

Construction accounting fundamentals

The construction industry stands out in its need to adhere to diverse accounting standards. Essential knowledge and key issues influencing the field are explored as you learn about the overall construction process through the following topics:

Industry players

Preparing cost estimates and bids

Project management

Contracts and modifications

Unique accounting issues for contractors

Various contractor expenses that affect job profitability need to be identified and examined to ensure accurate accounting of a company's total spending and performance. You'll review this concept and other characteristics unique to contractors as you gather critical information and learn the implications for CPAs. Relevant topics include:

Contractor financial statements

Common disclosures

Supplementary information

Working with a surety

Surety is an integral part of the construction process. You'll take a detailed look at the benchmarks a surety might analyze in a contractor's financial statements as well as the following topics:

Types of surety bonds

The surety process

Surety underwriting considerations

Warning signs for the surety

Highlights

Types of contractors

Non-revenue GAAP accounting for contractors

Contractor financial statements

Sureties and their place in the construction relationship

Prerequisites

None

Designed For

New staff to experienced staff with construction clients.

Objectives

Recall the predominant types of construction contractors and the work they typically perform.
Identify the common significant steps within the overall construction process.
Recognize select characteristics that are unique to the construction industry and that have accounting, audit, tax, or consulting consequences.
Identify the components of job costs incurred, the common categories into which the costs are divided, and the impact of both direct and indirect costs on the contractor.
Identify the unique characteristics of the contractor financial statements (specifically, accounts generally unique to construction contractors) and the unique disclosures common to contractor financial statements.
Recall the unique supplementary information normally included in the financial statements of a construction contractor.
Recall the main reasons for and types of surety bonds in the construction industry and the advantages to the owner of such bonds.
Identify the various financial benchmarks a surety or surety agent might analyze in a contractor's financial statements to determine the amount of the contractor's surety credit.