Paving and concrete bookkeeping: job costs that survive the season

Costing by job is the whole point of the books

A paving or concrete contractor does not run one business; it runs forty or four hundred small ones a year, each with its own material tickets, crew hours and machine time. Hot-mix arrives on plant tickets priced per tonne. Ready-mix arrives per cubic metre, with short-load and waiting-time charges added when a pour runs behind. Granular base, rebar, wire mesh, forms, tack coat and sealer all come from different suppliers on different terms. If those invoices are posted to a single materials account, the season's profit is a rumour.

We set up QuickBooks Online with a project (or class) for every job and tag each supplier line to a job at entry. Plant and ready-mix tickets go through Dext so the scale ticket, the delivery slip and the invoice are matched before anything is paid. Crew hours come in from a field time app such as ClockShark, busybusy or QuickBooks Time, coded to the same job list, so labour lands beside the material it placed. Small residential jobs are grouped by crew-day when that is how the crew actually works; what matters is that material and hours tie to the revenue they produced.

Holdbacks, progress certificates and what counts as revenue

On commercial and municipal work, the number on your invoice is not the number you will receive this month. Ontario's Construction Act requires the owner to hold back 10 percent of each payment, and that holdback is not released until the lien period runs after substantial performance is certified and published. We carry holdbacks in a separate holdback-receivable account, so ordinary A/R shows what is collectable now and the holdback balance is tracked job by job until it is released. The same applies in reverse to the holdback you withhold from your own subcontractors.

Municipal contracts are usually unit-price: the inspector measures tonnes, square metres and cubic metres, and the payment certificate — not your estimate — drives the revenue entry. Where the contract carries an asphalt cement price index adjustment, we record the adjustment as its own revenue line so you can see how much of a job's margin came from the index rather than from the crew. Residential deposits sit as a customer liability until the driveway is done. And because HST on a holdback is not due until the holdback is paid or becomes payable, the books have to keep that timing straight for the GST34 as well as for the income statement.

Equipment is a cost centre, not just a line on the balance sheet

The paver, the rollers, the milling machine, the concrete pump and the dump trucks are where most of the capital in this trade sits, and they are also where most of the hidden cost sits. We give each major unit its own fixed-asset record and its own repair and maintenance account, so you can see when a machine's upkeep is telling you something. Loan payments are split into interest and principal every month rather than dumped into an equipment expense, and lease agreements are read so that a purchase disguised as a lease is recorded as what it is.

Fuel gets the same discipline. Fleet card statements are split by unit, and coloured diesel bought for off-road equipment is kept separate from clear diesel for licensed trucks, because they carry different Ontario fuel tax treatment and an auditor will ask. Where you want per-hour equipment costs on job reports, we set an internal charge-out rate per unit and allocate machine hours to jobs, which is what turns a fleet from a fixed overhead into something you can price.

Subcontractors, T5018s and the paper trail CRA expects from construction

Concrete pumping, line painting, saw cutting, trucking brokers and the occasional excavation sub are all subcontractor payments, and because your business is construction they have to be reported on a T5018 information return each year. We keep a subcontractor ledger with legal names, business numbers and WSIB clearance status, so the slips are a report rather than a reconstruction. A clearance certificate is checked before a sub is paid, because without one you can be held liable for their premiums.

Construction is a standing focus of CRA's underground-economy work, and residential paving in particular attracts attention for cash jobs. Every deposit, e-transfer and cheque is recorded against a customer and a job, and the season closes with a full reconciliation of bank, loans, holdbacks and deposits so the year-end file is clean. If your reporting has drifted between cash and accrual accounting, we settle it once, in writing. For machines bought at US auctions or from US dealers, our cross-border guide for paving contractors covers how the border costs land in the books, and our bookkeeping services page explains the monthly close we run for every client.

Source: Ontario — Construction Act, R.S.O. 1990, c. C.30.