 HARDING, SHYMANSKI & COMPANY Certified Public Accountants and Consultants
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Construction and Real Estate industry
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Because Harding, Shymanski & Company, P.S.C. is committed to providing quality service to our construction and real estate clients, we have selected a team of dedicated professionals to serve as your industry's consultants. These individuals understand the language and key issues unique to your industry and possess the drive and determination to help you manage your company on a proactive basis. |
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Maintaining Profitability
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Most contractors are still feeling a pinch in the current economy even though economic indicators are pointing to a slight recovery in many areas of the country. Contractors must continue to distinguish themselves in hopes of obtaining private market work versus always being subject to the low bid atmosphere. Construction companies should establish and maintain client relationships in the industry. Some of the high importance items to consider are establishing name recognition, going the extra mile, relying on peers and technology, and being prepared for financial downturns. When establishing name recognition, it is important to publicize the firm's accomplishments and demonstrate your strengths. Companies should consider obtaining testimonials from their best customers and publicizing on the firms website. Certification and award recognition is another way to establish name recognition. Some firms set money aside to donate to a client's charity or take them to sporting events as well. Technology can appeal to clients through an updated website and easily obtaining estimates or project plans being posted for access at anytime. Being prepared is also important during economic downturns. Realigning jobs and personnel so that no employee is idle even in the worst of circumstances is crucial. Finding connections between project managers and clients also helps build customer loyalty. For more information on how your company might use some of these techniques, please contact Paul Esche, CPA, CCIFP, CCA, or Greg Elpers, CPA, CCA, at (800) 880-7800. Source: Jessica Porter, "Keeping Profits Up in a Down Economy" (August 2012 Construction Executive magazine). |
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Financial Reporting Framework for Small and Medium Sized Entities
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In November of 2012, the AICPA related an exposure draft of a financial reporting framework for small to medium sized companies which is designed to be less complicated and less costly than the current US GAAP. All financial statements are prepared in accordance with some type of financial reporting framework. A financial reporting framework is a set of criteria used to determine measurement, recognition, presentation, and disclosure of material items in a financial statement. This new development is intended for smaller- to medium-sized, owner-managed, for-profit entities. It involves blend of traditional methods of accounting with some accrual income tax methods. Now, comments and suggestions are being taken to what can be done to implement the new framework. The AICPA is expected to issue the final framework in the first half of 2013. The benefit of the new reporting framework will provide a less complicated and less costly system for accounting. Historical cost will be used as its measurement basis, departing from the increased use of fair value. Accounting for derivatives, hedging activities, and stock compensation are some examples of the complicated items that will not be required anymore. The disclosure requirements will be greatly reduced, providing the financial statement users with the relevant information needed. The financial reporting framework for SMEs is supposed to be a stable framework that will not undergo frequent changes. It is also important to note that the financial reporting framework for SMEs is not inferior or superior to GAAP; the issue is what is most suitable for an entity. Contact Paul Esche, CPA, CCIFP, CCA, at (800) 880-7800 with questions.
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Top 10 Best Practices to Maintain Surety Bond Strength
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Some members of the HSC Construction Team recently attended a national construction conference held in Las Vegas. Below is a list of 10 best practices to maintain surety bond strength as well as creditworthiness with your financial institution.
1. Focus on liquidity
2. Reduce staff where possible
3. Sell unused equipment and inventory, even at deep discounts if necessary
4. Aggressively pursue old A/R or settle change order disputes
5. Successfully implement simultaneous multilateral size correcting strategies
6. Be prepared to personally guarantee bonds and/or inject cash into your business
7. Good job cost accounting
8. Transparency and frequent communication between surety and contractor is imperative
9. Good, honest, and reliable accounting practices
10. Need to effectively manage debt
Please contact Greg Elpers, CPA, CCA, or Paul Esche, CPA, CCIFP, CCA, at (800) 880-7800 should you have any questions or if you would like additional information related to these best practices.
We also have available a list of recommendations from sureties on how to respond to "tough times" and increase risk in today's construction environment. Please contact Greg or Paul if you would like more information related to this topic.
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Harding, Shymanski & Company, P.S.C. provides accounting, tax, and consulting services to our clients from offices in Evansville, Indiana, and Louisville, Kentucky.
We are committed to quality. Adding value to the services we provide is our most important goal. Our unwavering dedication and commitment to quality resonate throughout every aspect of our work.
Call us today! (800) 880-7800
www.hsccpa.com
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Disclaimer
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The information contained in this email is for general guidance on matters of interest only. The publication does not, and is not intended to provide legal, tax or accounting advice.
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