Specialized financial accounting: The foundation for success in the construction industry
Why specialized financial accounting is essential for construction companies
A precise financial accounting for construction companies is, we are sure, much more than just a legal obligation; it is the backbone for the economic success and sustainable development of your company in the construction industry. Given the complexity of construction projects, often characterized by long durations, high order volumes, and a variety of subcontractors, standard accounting quickly reaches its limits. This is precisely where specialized systems and processes are necessary to accurately assign costs, recognize revenues on an accrual basis, and transparently represent the profitability of individual projects. Only then can you make informed decisions and navigate your company safely through dynamic market conditions. We at Valoon GmbH understand these challenges all too well and offer solutions that are tailored to the needs of construction companies to optimize your financial accounting. Discover with us how to optimize your processes and avoid many pitfalls.
- Specialized financial accounting is more than a duty – it is the backbone of success.
- Standard accounting is insufficient for complex construction projects (long durations, high volumes, many subcontractors).
- Specialized systems are needed for accurate cost allocation, timely revenue recognition, and transparent project profitability.
- Informed decisions and secure corporate management are based on precise financial accounting.
The unique challenges of the construction industry regarding accounting and compliance
The construction industry presents us all with unique requirements for the financial accounting for construction companies. This includes the correct representation of progress payments, the management of guarantees and retention, as well as compliance with specific tax regulations such as the construction withholding tax and the reverse-charge regulation (§ 13b UStG). The must not only document ongoing business transactions but also accurately represent complex issues such as the valuation of unfinished construction services and the establishment of provisions. And then there are the compliance requirements, for instance, the GoBD (principles for proper management and storage of books, records and documents in electronic form as well as data access), which must be strictly adhered to in order to avoid unpleasant surprises during audits. Compliance with these regulations is essential for a sound financial accounting for construction companies and protects, as we know, against heavy penalties.
Overview of the key aspects of financial accounting in construction
To master the complexity of the financial accounting for construction companies , a clear understanding of the core aspects is crucial. These form the basis for accurate and meaningful bookkeeping, helping you maintain oversight and secure the profitability of your projects. This includes particularly performance billing, handling construction withholding tax, and using industry-specific chart of accounts. Careful attention to these points is as important for every newly established construction company as it is for established businesses – we can say this from experience. The correct application of these principles ensures that your financial accounting for construction companies is not only legally compliant but also provides valuable insights for corporate management.
- Performance billing: The correct capture and billing of construction services, often via partial final bills and final bills, is absolutely central. Here, the precise allocation of costs and revenues to individual construction projects plays a key role for the control of major projects and the assessment of project progress.
- Construction withholding tax: A specific procedure in the construction industry, whereby the recipient of the service must withhold 15% of the invoice amount under certain conditions and pay it to the tax office. The correct handling is crucial here to avoid additional claims and penalties.
- Specific chart of accounts: The use of chart of accounts such as SKR03 or SKR04, tailored to the needs of the construction industry, allows for detailed and structured recording of all business transactions and serves as a basis for meaningful intelligent reporting..
Efficient accounting in the construction industry: Mastering systems and standards
Double entry bookkeeping vs. simple bookkeeping: Which system is suitable?
For most construction companies, the double entry bookkeeping is simply essential, to ensure transparent and traceable financial accounting. accounting. Unlike the simple income surplus calculation (EÜR), which is only permissible for smaller businesses with lower revenues and profits, double entry bookkeeping offers a truly detailed insight into the assets, financial, and earnings situation of the company. It enables the preparation of a balance sheet and a profit and loss statement (P&L), which are of great significance not only for internal control purposes but also for external stakeholders such as banks and tax offices. One might say that the is the foundation for meaningful cost and performance accounting and thus an important tool for successfully running a construction company and solid financial accounting for construction companies.
The key chart of accounts in the construction industry (SKR03, SKR04): A comparison
In Germany, the standard charts of accounts SKR03 and SKR04 are widely used and, as many of you know, also form an important foundation for the financial accounting for construction companies . The SKR03 is oriented towards the business processes of a company (process structuring principle), while the SKR04 is based on the balance sheet structuring principle and is more closely aligned with the structure of the balance sheet and P&L. For construction companies, the choice of the chart of accounts may depend on the size of the company, the complexity of the business transactions, and of course the preferences of the tax consultant. Both charts of accounts provide the opportunity to make industry-specific adjustments, such as setting up cost centers for individual construction sites or managing specific accounts for construction withholding tax. A careful selection and adjustment of the chart of accounts is crucial for meaningful accounting and often significantly facilitates collaboration with the tax consultant.
Basic booking entries and their application in the construction industry
The correct posting of business transactions is, as we all know, the heart of every accounting in the construction industry.Typical booking entries in the construction industry include the purchase of materials, the recording of labor costs, and the handling of progress payments. For instance, when purchasing materials, the account ‘expenses for raw, auxiliary, and operating materials’ is debited, and the liabilities account or bank account is credited. Labor costs are recorded accordingly to wage and salary accounts. A peculiarity to watch out for are progress payments: According to the , these are often treated as received deposits and only recognized as sales revenues upon acceptance of the service. The percentage-of-completion method (PCM) is a common method here to allocate revenues and expenses over the project duration. The precise application of these booking entries is essential for an accurate financial accounting for construction companies and the correct determination of the company’s success.Value-added tax in the construction industry: Mastering §13b UStG and progress payments
The reverse-charge regulation (§ 13b UStG): When it applies and how it is correctly implemented
Die Reverse-charge regulation according to § 13b UStG is a central VAT peculiarity in the financial accounting for construction companies, which we encounter repeatedly. It applies when a construction company (service provider) performs a construction service for another company that sustainably provides construction services (recipient). In this case, the tax liability for the VAT shifts from the providing entrepreneur to the recipient. This means the recipient must calculate the VAT themselves and remit it to the tax office. A prerequisite is that it is a and the recipient themselves sustainably provides construction services and proves this with a valid exemption certificate according to § 48b EStG or a proof USt 1 TG. The correct application of this regulation is, as you can imagine, crucial to avoid tax assessments and liability risks and is an important aspect of the financial accounting for construction companies.
- § 13b UStG (reverse-charge) is a central VAT peculiarity for construction companies.
- The tax liability for VAT shifts from the providing entrepreneur to the recipient.
- Prerequisites: defined construction service and recipient sustainably provides construction services (proof required).
- Correct application avoids tax assessments and liability risks.
Important steps for the correct application of § 13b UStG:
- Check the definition of construction services: Ensure that the service provided is indeed considered a construction service in the sense of § 13b UStG. This includes work that serves to create, repair, maintain, alter, or remove buildings.
- Verify the entrepreneurial characteristic of the recipient: The recipient must themselves sustainably provide construction services. Request appropriate proof (e.g. copy of the exemption certificate according to § 48b EStG or the form USt 1 TG).
- Correct invoicing: The invoice must be issued net and include a note on the reverse-charge liability, e.g., “Tax liability of the recipient according to § 13b UStG.” Proper invoicing is essential here.
VAT on progress payments: What to pay attention to?
In the case of progress payments in the construction industry, another important point is that VAT generally arises upon receipt of the payment, i.e., at the time of payment by the customer. This also applies if the underlying service has not yet been fully performed or accepted. For the, this means that VAT from received progress payments must be declared and remitted in the respective VAT advance return. If the service is provided to another construction contractor and the reverse-charge regulation according to § 13b UStG applies, the recipient owes VAT on progress payments as well. In this case, the providing entrepreneur issues a net invoice for the progress payment with reference to § 13b UStG. Accurate documentation and timely posting are essential here, as always, for a correct financial accounting for construction companies bedeutet dies, dass die Umsatzsteuer aus erhaltenen Abschlagszahlungen in der jeweiligen Umsatzsteuer-Voranmeldung deklariert und abgeführt werden muss. Wird die Leistung an einen anderen Bauunternehmer erbracht und greift die Reverse-Charge-Regelung nach § 13b UStG, schuldet der Leistungsempfänger die Umsatzsteuer auch auf die Abschlagszahlungen. In diesem Fall stellt der leistende Unternehmer eine Nettorechnung über die Abschlagszahlung mit dem Hinweis auf § 13b UStG. Eine genaue Dokumentation und zeitnahe Verbuchung sind hierbei, wie so oft, für eine korrekte financial accounting for construction companies accounting.
Special cases: Construction services abroad
When construction companies perform services abroad, the financial accounting for construction companies, as you can imagine, becomes even more complex. Here, the VAT regulations of the respective country where the construction service is performed (place of service) must be observed. This may mean that the German construction company must register for tax purposes abroad and remit VAT there. While there are harmonized principles within the EU, there are also national differences that one should be aware of. For construction services to private individuals in EU countries, the VAT of the country where the property is located usually applies. For services to contractors in EU countries, the reverse-charge procedure of the respective country may also apply. Our advice here: An early clarification of tax obligations abroad, possibly involving a specialized tax consultant, is essential for a compliant financial accounting for construction companies accounting to avoid double taxation or tax assessments.Understanding and correctly handling construction withholding tax: A practical guide
What is construction withholding tax and who is affected?
Let’s move on to another important topic: The construction withholding tax is a tax deduction of 15% of the invoice amount (including VAT), which the service recipient (client) must withhold and pay to the tax office for domestic construction services on behalf of the providing entrepreneur (contractor). All entrepreneurs within the meaning of § 2 UStG and legal entities under public law as service recipients are affected. The provider must perform construction services within the meaning of § 48 Abs. 1 Satz 3 EStG. The aim of this regulation is to secure tax revenues and combat illegal employment in the construction industry. For the financial accounting. recipient, this naturally means an additional administrative task, while for the providing entrepreneur, it results in a temporary liquidity deduction that is later offset against their tax liability. Accurate knowledge of this regulation is essential for correct financial accounting for construction companies accounting on both sides.
Calculation and remittance of construction withholding tax: Explained step by step
The good news first: The calculation of the construction withholding tax is relatively straightforward: 15% of the gross invoice amount. The service recipient must withhold this amount from the payment to the providing entrepreneur. The withheld construction withholding tax must then be reported and remitted to the tax office responsible for the providing entrepreneur by the 10th of the month following the month of the withholding. For this, an officially prescribed form must be used. For the financial accounting. recipient, it is important to document this process accurately and strictly adhere to deadlines. The providing entrepreneur receives a statement from the recipient about the tax deduction, which they need for their financial accounting for construction companies accounting and the later offsetting against their tax liability. Careful documentation, for instance via a measurement app, can be very helpful in this regard.
Exemption from construction withholding tax: Requirements and application procedure
Is there a way to avoid this deduction? Yes! Providing entrepreneurs can be exempted from construction withholding tax by presenting their client with a valid exemption certificate according to § 48b EStG . This certificate is issued by the tax office of the providing entrepreneur when there are no tax concerns (e.g. no tax arrears). Among other things, the prerequisites for issuing are the tax reliability of the applicant. The application can be made informally to the tax office. If the service recipient holds a valid exemption certificate at the time of payment, they do not need to make a tax deduction. For the financial accounting for construction companies recipient, it is naturally crucial to check the validity of the certificate and keep a copy for their own records. The exemption certificate is an important instrument to preserve the liquidity of the providing construction entrepreneur.
The role of the exemption certificate
This exemption certificate under § 48b EStG thus plays a really central role in the system of construction withholding tax and is therefore an important component of the financial accounting for construction companies. It serves as proof to the service recipient that the providing entrepreneur is exempt from the obligation to withhold tax. But be careful: The service recipient is obligated to verify the validity of the submitted certificate, for example, through the online portal of the Federal Central Tax Office (BZSt). Only a valid exemption certificate at the time of payment absolves the service recipient from the obligation to withhold and remit construction withholding tax. Otherwise, the service recipient is liable for the unpaid tax – and that can be costly. Careful management and checking of these certificates is therefore a critical process in the financial accounting for construction companies, to minimize financial risks in the construction industry. Mastering construction payroll complexity: SOKA-BAU and collective agreements in controlBaulohn-Komplexität meistern: SOKA-BAU und Tarifbestimmungen im Griff
What is construction payroll and why is it so special?
Der Construction payroll – a topic in itself and often a real challenge in the financial accounting for construction companies.Its peculiarity arises from a multitude of collective agreement and legal regulations tailored to the specific working conditions in the construction industry. This includes, for example, regulations for flexible working time (e.g. working time accounts), promotion of winter employment (seasonal short-time work allowance, winter wage subsidy, additional winter allowance), various allowances and supplements (e.g. difficulty bonuses, travel cost reimbursements), as well as the mandatory contributions to SOKA-BAU. This complexity requires specialized knowledge and often also specialized construction software for calculation and billing to avoid errors and related financial risks. Accurate construction payroll accounting is crucial for employee satisfaction and compliance with legal requirements in the accounting – this goes without saying.
The social fund of the construction industry (SOKA-BAU): Responsibilities and contributions
Those working in construction are familiar with it: the SOKA-BAU, a joint institution of the collective bargaining parties of the construction industry (Main Association of the German Construction Industry, Industrial Union Building-Agriculture-Environment, Central Association of the German Construction Industry). It finances and organizes various services for employees and employers in the construction industry, which are necessary due to the industry-specific peculiarities such as frequent job changes and weather dependence. The core tasks of SOKA-BAU include securing vacation entitlements (vacation procedures), promoting vocational training, and additional retirement benefits (ZVK-Bau). Employers in the construction industry are required to pay monthly contributions to SOKA-BAU. The amount of the contributions is based on the gross wage sum of the skilled workers and the applicable contribution rates. The correct calculation and remittance of these contributions is an essential and not to be underestimated component of construction payroll accounting and thus of the financial accounting for construction companies.
Collective agreements and their impact on payroll accounting
In addition to SOKA-BAU, the applicable collective agreements (Federal Framework Collective Agreement for the Construction Industry – BRTV Construction Industry, Collective Agreement on Social Fund Procedures in the Construction Industry – VTV, Collective Agreement on Additional Retirement Benefits in the Construction Industry – TZA Construction) play a major role in payroll accounting in the construction industry. These regulate minimum wages, working hours, vacation entitlements, allowances for overtime, night, Sunday, and holiday work, as well as special payments. Our task in the financial accounting for construction companies is then to ensure that these collective provisions are implemented accurately. This requires precise time recording on the construction site and careful maintenance of employee master data. And since collective agreements can change, these changes must be incorporated into the payroll accounting software promptly to ensure correct and legally compliant billing. The complexity of the collective landscape makes construction payroll, as you see, a truly demanding task within the financial accounting..
Specific wage types and allowances in the construction industry
And as if that weren’t enough, there are a variety of specific wage types and allowances in construction payroll accounting that must be correctly recorded and billed. These include, for example: financial accounting for construction companies korrekt erfasst und abgerechnet werden müssen. Dazu zählen beispielsweise:
- Additional winter pay (MWG) and winter wage subsidy (ZWG): Benefits to promote all-year-round employment.
- Seasonal short-time work allowance (seasonal Kug): A special form of short-time work allowance for construction companies during bad weather periods.
- Difficulty allowances: For particularly burdensome or dangerous work.
- Travel time compensation/travel cost reimbursement: For trips to the construction site.
- Daily allowances: Meal allowances for work outside the home.
The correct determination and taxation or social security treatment of these wage components requires in-depth expertise and a precise data basis in the financial accounting for construction companies. Errors can lead, as you can imagine, to unpleasant claims from social security institutions or the tax office.Optimal software selection: Efficiency enhancement for your construction financial accounting
Overview of common software solutions for construction companies
Fortunately, there is now a wide range of software solutions specifically tailored to the needs of the financial accounting for construction companies . These range from pure accounting programs to comprehensive ERP systems for the construction industry, which can cover all business processes. In principle, the solutions can be divided into cloud-based software and on-premise installations . Cloud solutions offer the advantage of location-independent access and often lower initial investment costs, while on-premise systems can provide greater control over data and infrastructure – both have their justification. Important features often include, in addition to standard accounting, modules for cost accounting, reminders, asset accounting, and special functions for the construction industry such as the representation of interim and final invoices or the integration of construction payroll. A careful analysis of one’s own needs is absolutely crucial for selecting the right software for your financial accounting for construction companies.
- Wide range of software solutions for construction financial accounting available, from pure accounting programs to ERP systems.
- Distinction between cloud-based (flexible, lower start costs) and on-premise solutions (data control).
- Important functions: standard accounting, cost accounting, reminders, asset accounting, construction-specific features (interim/final invoices, construction payroll).
- Careful needs analysis is crucial for the right software selection.
Criteria for selecting the right software
But what should be the focus when selecting the right software for the financial accounting for construction companies really? The decision should be made based on clearly defined criteria to ensure that the solution meets the specific needs of your operation and provides real added value for the financial accounting for construction companies . Because unsuitable software can quickly lead to inefficiencies, errors, and understandably, frustration. Therefore, thorough evaluation is essential.
Important selection criteria at a glance:
- Industry-specific features: The software must be able to address the peculiarities of the construction industry, such as managing retention, §13b UStG, construction withholding tax, interim and final invoices. That is a must!
- User-friendliness: An intuitive operation and clear structure are important to shorten onboarding times and increase acceptance among employees. We at Valoon GmbH, for example, place great emphasis on simplicity and user-friendliness..
- Interfaces to other systems: The possibility of integration with other systems used in the company (e.g., construction payroll, inventory management, construction calculation software, project management tools like our solution at Valoon GmbH) is crucial for a consistent data flow and avoiding duplicate entries.
- GoBD Compliance: The software must comply with the principles for proper management and retention of books, records, and documents in electronic form, as well as access to data. Certification (e.g., GoB/GoBS) is an important quality feature here.
- Scalability and Flexibility: The software should be able to grow with your company and allow for adjustments to changing needs. Think about the future!
Introduction to selected software solutions (with reference to research input)
As mentioned before, there are various software providers specializing in financial accounting for construction companies . At Valoon GmbH, we focus, for example, on the seamless integration of common messenger services like WhatsApp, to simplify data collection directly from the construction site and turn unstructured communication into usable project data – an approach that facilitates practical work. Other solutions like Pro-Bau/S® Financial Accounting score with strong automation, for example, through ‘posting automation,’ and a GOB/GoBS certification. Bau-SU Financial Accounting stands out due to its integration capabilities with other Bau-SU modules and customizability, including document management with ARCHIV number system. For smaller companies or ones that value particularly simple operation and direct tax advisor integration, sevdesk could be an interesting option, which advertises automated receipt processing and ELSTER interface. SIS-KEOPS on the other hand, focuses on construction-specific functions like partial/final invoice automation. For our colleagues in the Swiss market, SORBA is a well-known cloud-based solution. As you can see, each of these solutions has specific strengths that should be considered when selecting for your own financial accounting for construction companies .ERP Integration: Data-driven decisions for your construction company enable
The advantages of an integrated solution over isolated solutions
Another major step towards increased efficiency and better decisions is the integration of financial accounting for construction companies into a comprehensive ERP system (Enterprise Resource Planning). This offers significant advantages over the use of isolated software applications, known as island solutions. Imagine: An integrated solution creates a central data repository, accessible to all relevant departments. This not only avoids redundant data entries and reduces error sources but also significantly improves data consistency. Information from project planning, material management, or time tracking flows directly into the financial accounting and cost accounting, enabling timely and accurate project calculation and control. This seamless information flow is a decisive factor for efficient financial accounting. and supports agile corporate governance. As we see with some providers like Bau-SU, there is a strong emphasis on this integration.
Core modules of an ERP system for construction companies (order processing, material management, personnel planning)
What constitutes a powerful ERP system for us in construction? Typically, it includes several core modules that are closely interconnected. These include financial accounting for construction companies order processing from quotation generation to invoicing through to change order management, material management (purchasing, inventory, scheduling), personnel planning (deployment planning, capacity overview) and often also a device scheduling. The beauty of it: The data from these operational modules, such as material costs from purchasing or labor hours from personnel planning, flow directly into the project accounting and thus into the (Einsatzplanung, Kapazitätsübersicht) und oft auch eine Gerätedisposition. Das Schöne daran: Die Daten aus diesen operativen Modulen, wie beispielsweise Materialkosten aus dem Einkauf oder Lohnstunden aus der Personalplanung, fließen direkt in die Projektbuchhaltung und somit in die project accounting . This allows detailed recalculations and effective controlling of large projects.Integration ensures that all relevant information for financial decisions is current and consistent – a solid foundation.
Real-time data access and improved decision-making through integration
One of the unbeatable advantages of an integrated financial accounting for construction companies within an ERP system is the access to financial data in real time.Imagine managers and decision-makers being able to access current metrics on liquidity, project costs, or profitability at any time. This allows for quicker responses to changes, early identification of risks, and informed business decisions. A practical example: Immediate visibility of cost overruns in a project can lead to timely corrective measures before costs escalate significantly. The Pro-Bau/S® Financial Accounting mentioned in the research input, for example, emphasizes its real-time reporting dashboard. This direct access to current information is a key competitive advantage and a core benefit of modern financial accounting for construction companies..
cost and performance accounting in the integrated system.
Also, the good old cost and performance accounting (KLR), an indispensable tool for managing construction companies, benefits immensely from integration into an ERP system with connected financial accounting for construction companies. Through the direct use of actual data from financial accounting and the operational modules (e.g., material withdrawals, recorded working hours), precise target-actual comparisons at the project and cost center level can be conducted. This allows for detailed analysis of the profitability of individual construction sites and performance areas. Therefore, deviations from the plan are quickly noticed, and their causes can be analyzed. An integrated KLR thus provides the necessary transparency for effective cost control and sound pricing, which is crucial for the success of the accounting and the entire business. The Bau-SU Financial Accounting, for example, allows for a direct period-appropriate burden on the business management (BBS) through its integration.Efficiency boosters: Best practices for your financial accounting in construction
Digitalization of receipt management: scanning, OCR, and automatic receipt recognition
Let’s be honest: Who doesn’t sometimes struggle with paper mountains and the manual entry of receipts? A paper-based receipt management is not only time-consuming and error-prone but simply inefficient. The digitalization of receipt management is, therefore, a crucial step towards optimizing the financial accounting for construction companies – a real game changer! By scanning paper receipts or importing digital invoices (e.g., ZUGFeRD, XRechnung) and using OCR technology (Optical Character Recognition), relevant data such as the issuer, date, amount, and items can be automatically extracted and prepared for posting. Software solutions like sevdesk or BauSU with its XML server and incoming invoice control provide such helpful functions. This drastically reduces manual input efforts, minimizes errors, and speeds up the entire booking process. A digital receipt archive also ensures GoBD compliance and allows for quick access to necessary documents, which significantly improves the efficiency of the financial accounting. .
Automation of routine tasks: bank reconciliation, reminders, payment transactions
And there are even more areas where automation can make our lives in the financial accounting for construction companies easier, freeing up valuable time for more demanding tasks. The automatic bank reconciliation, where electronic account statements (e.g., via CAMT import like at Bau-SU) are matched with open items in accounting and payment entries are automatically assigned, is a wonderful example of this. Also think about reminders: They can be made significantly more efficient through automatic notifications and the creation of reminder letters after definable stages (like with Pro-Bau/S®). In payment transactions, software solutions enable the automatic generation of transfer forms or SEPA files while considering discount periods. These automations contribute significantly to increased efficiency and error reduction in the accounting and improve liquidity management on the side.
Regular account reconciliation and liquidity planning
A classic, but still important and often underestimated: A regular and careful account reconciliation is the key to sound financial accounting for construction companies. At least monthly, all balance sheet accounts, especially bank accounts, receivables, and payables, should be reconciled to recognize and clarify discrepancies early on. Closely linked to this is proactive liquidity planning. And those who have their accounts under control can also plan liquidity better. This provides insight into expected inflows and outflows and helps to identify liquidity bottlenecks in time and take corrective measures. Modern software solutions often offer integrated tools for liquidity planning based on current accounting data and planned cash flows. Particularly for us in construction, where we often face high prepayments and long payment terms, proactive liquidity control is vital and a core component of a professional financial accounting for construction companies. Pro-Bau/S® highlights current liquidity data as a feature, for example.
Training of employees and continuous further education
But all the great software and optimized processes are of little use if the employees do not possess the necessary knowledge and skills to use them effectively. Therefore, regular training and continuous further education of employees working in the area financial accounting for construction companies is simply essential. This not only concerns the operation of the software used but also the understanding of industry-specific accounting and tax regulations (e.g., §13b UStG, construction withholding tax, construction payroll). Because the world of laws and regulations is not standing still: Legislative changes or new jurisprudence must be communicated in a timely manner and integrated into internal processes. Investments in employee qualifications pay off through higher work quality, fewer errors, and improved compliance, and strengthen the competence of the financial accounting for construction companies sustainably. At Valoon GmbH, we actively support our customers in realizing the full potential of our solutions.
Critical areas for employee training:
- Software application: Efficient use of all relevant modules and functions of the financial accounting software used.
- Legal foundations: Current knowledge of commercial law, tax law (especially VAT, construction withholding tax), and social security law (construction payroll).
- Internal processes: Understanding and compliance with internal company processes and guidelines for accounting and receipt management.
Future-proof financial accounting: Your path to greater profitability in construction
The importance of professional financial accounting for the success of construction companies
If there’s one thing we hope to convey in this article, it’s this: Professionally managed financial accounting for construction companies is far more than a tedious obligation – it is a strategic tool for the sustainable success of your construction company. It not only provides the basis for compliance with legal requirements but also enables a transparent representation of assets, financial, and earnings situation. And you will feel this in dealings with banks, investors, and business partners, as it builds trust. Furthermore, a well-organized financial accounting. provides valuable data for project controlling, cost accounting, and liquidity planning. Because let’s be honest: Who wants to make crucial business decisions in blind navigation? Investing in modern, industry-specific software and qualified employees pays off through efficiency gains, risk minimization, and ultimately higher profitability.
Future trends in financial accounting in construction (e.g., AI, automation)
And the journey continues: The financial accounting for construction companies is in constant change, driven by exciting technological developments. Keywords like artificial intelligence (AI) and further automation are no longer just futuristic concepts but will play an increasingly larger role. AI-supported systems can, for example, become even more precise in automatic receipt recognition and posting (as indicated by providers like Candis or sevdesk), detect anomalies in data patterns, and create forecasts for liquidity development. The automation of routine processes like reminders or payment transactions will continue and create room for more demanding analytical tasks. Cloud technologies enable more flexible access to data and better collaboration. Also, the integration of data from various sources, as our Valoon GmbH software is advancing through the connection of messenger services for the digital field data collection , will become increasingly important for comprehensive financial accounting for construction companies .
Recommendations for construction companies to optimize their financial accounting processes
What can you do concretely to make your financial accounting for construction companies future-proof and optimally designed? Here are a few recommendations from our side: Focus on digitalization and automation, whenever it makes sense, to reduce manual efforts and minimize sources of errors. Choose a software solution specifically tailored to the needs of the construction industry that integrates seamlessly into your existing IT landscape. Pay attention to high user-friendliness to promote acceptance among your employees – a core concern of ours at Valoon GmbH. Invest in the training of your employees, so they can use the systems efficiently and understand the complex regulations of the construction industry. And very importantly: Stay on track! Regularly review your processes and adjust them as necessary to new circumstances. An optimized financial accounting for construction companies is a continuous process, but one that pays off through increased efficiency, transparency, and ultimately economic success. Optimizing your financial accounting in the construction company is a crucial step towards greater profitability and security. Contact us at Valoon GmbH today via our contact page, to start your individual consultation and jointly unlock the potentials for your company. Sign up and find out how we can simplify your data collection and project communication.
Why is specialized financial accounting so important for construction companies?
Specialized financial accounting is essential for construction companies, as it accurately reflects complex requirements like advance payments, construction withholding tax, and § 13b UStG. It enables precise project cost tracking and period-appropriate revenue recognition, which is critical for informed decisions and compliance with regulations like GoBD. und What is the difference between SKR03 and SKR04 for my construction company?, was für fundierte Entscheidungen und die Einhaltung von Compliance-Vorgaben wie GoBD entscheidend ist.
Was ist der Unterschied zwischen SKR03 und SKR04 für mein Bauunternehmen?
Der SKR03 is oriented towards the business processes, while the SKR04 is structured based on the balance sheet and income statement. Both can be adapted for construction companies to represent, for example, cost centers for construction sites. The choice often depends on the company’s size and the preferences of your tax advisor; a careful adaptation is crucial for meaningful accounting..
How does the reverse charge mechanism (§ 13b UStG) work in construction?
In construction services between two construction companies, the VAT liability transfers to the recipient of the service.The performing entrepreneur issues a net invoice with reference to § 13b UStG. Important is the verification of the construction service characteristic and the entrepreneurial status of the recipient (e.g., through a certificate of exemption) to avoid liability risks.
What do I need to know about construction withholding tax and how do I obtain an exemption?
The client must withhold 15% of the invoice amount and remit it to the tax office. An exemption certificate under § 48b EStG, issued by the tax office of the performing entrepreneur, frees from this deduction. The recipient of the service must check the validity of the certificate..
What software features are particularly important for financial accounting in construction?
Pay attention to industry-specific functions such as the representation of partial/final invoices, §13b UStG, construction withholding tax, and ideally construction payroll. Important are also usability, interfaces to other systems (e.g., project management, messenger services like at Valoon GmbH for easy data collection) and GoBD compliance..
How can digitalization improve my financial accounting in a construction company?
Digitalization, for example, through automated receipt recognition (OCR),electronic bank reconciliation, and digital receipt archives, significantly reduces manual effort.This can decrease the processing time for receipts by up to 95%, minimize errors, and accelerate the entire booking process.
What advantages does the integration of financial accounting into an ERP system offer?
An ERP integration creates a central data repository, avoids duplicate entries, and enables real-time data access.This leads to improved decision-making, precise project calculations, and efficient cost and performance accounting.
How does Valoon GmbH specifically help me with financial accounting in construction?
Valoon GmbH optimizes your financial processes by simplifying data collection directly from the construction site through common messenger services. We convert unstructured communication into usable project data , eliminating the need for complex software training and sustainably improving the flow of information between field and office. nachhaltig verbessert.
