Management accounts for construction firms
You see your cash for the next thirteen weeks, with your CIS, VAT and payroll bills on the dates they are due, so you can spot a tight week before it arrives. Retention is shown on its own line, so it is never counted as cash in the bank.
What are management accounts?
Management accounts are reports on your own business, usually each month, so you can see how it is doing during the year instead of finding out at the year end. No law requires them. The accounts you must file are your year end accounts, which your accountant prepares.
Most sets include a profit and loss, a balance sheet and a look at cash. We keep your books up to date each month in your own Xero, so your profit and loss and balance sheet are ready whenever you, your accountant or a lender asks for them. For a construction firm, cash is what decides whether this month's bills get paid, so that is where our management accounts do the most work. They are reports and a cash forecast built from your books. They are not your year end accounts, and we are bookkeepers, not accountants.
Your tax bills go in on the dates they are due
Because we prepare your CIS, your VAT and your payroll, your tax bills go in on the dates they are due, worked out from your own up to date books rather than guessed from last year.
In construction, a cash shortfall is rarely caused by a surprise in income. It is usually a known bill landing in the same week as a customer who pays late.
See your next thirteen weeks before they arrive.
See your priceHow we show retention in your forecast
Retention is the part of each payment your customer holds back and pays after you finish. Count it as cash and your forecast is wrong. Leave it out and it is easy to forget to chase.
We put it on its own line with the date it is due, and tell you when it is overdue so you can chase it.
What you get each month
What your management accounts include, on top of your monthly bookkeeping.
| What you get | What it tells you |
|---|---|
| A thirteen week cash forecast | Your money in and out, week by week, starting from what is in your bank, with every bill you already know about on the date it is due. |
| What each job has cost and brought in | Your costs and your invoices recorded against each job, so you can see how every job is doing so far. If a cost could belong to more than one job, we ask you. |
| Budget against actual | What you planned to earn and spend next to what really happened, in pounds and in percent, with the big differences pointed out. |
| Scenarios before you decide | What taking on an employee, or buying a machine outright, would do to your cash. We work it out on the forecast without changing your books. |
You can also try our free CIS deduction calculator and reverse charge checker. They are free and need no sign up.
What we do not advise on
We show you your own numbers, set out clearly, and explain what is behind them. That is bookkeeping, not advice. We do not:
- Give tax advice, such as on R&D claims, salary or dividends, or which VAT scheme to use. We are bookkeepers, not tax advisers.
- Give financial advice on pensions or investments. That needs an FCA authorised adviser.
- Make your decisions for you. We show what the numbers look like under each option and you choose. If a choice affects your tax, check it with your accountant too.
- Prepare your year end accounts or corporation tax return. Your accountant does those, and they get clean, up to date books, so there is less for them to sort out.
You get clear, up to date numbers to make decisions with. For anything that affects your tax, we will tell you to check with your accountant.
Common questions about management accounts
How much do management accounts cost?
Nothing extra. It is included in our monthly bookkeeping, and you can see your monthly price on our pricing page in about a minute.
How do you build a cash flow forecast for a construction firm?
We start from what is in your bank today. We add what customers already owe you on the dates they are due to pay, take off what you owe suppliers and subcontractors, and put your CIS, VAT and payroll bills in the weeks they are due. Retention sits on its own line. Each month we check the forecast against what actually happened.
How is this different from the forecast in my accounting software?
We work your tax bills out from your own books and put them on the dates HMRC sets, instead of estimating from what you paid before.
Why does the cash forecast cover thirteen weeks?
Thirteen weeks is far enough ahead to spot a cash shortfall while there is still time to act, and close enough that most of the figures are already known. A twelve month view answers different questions and is not part of this service.
How do you show retentions in the forecast?
Retention is the part of a payment your customer holds back until after the job. We show it on its own line with the date it is due to be released, and never count it as cash you have. If the date passes and the money has not arrived, we tell you so you can chase it.
Do I need your bookkeeping to get management accounts?
Yes. The forecast is built from the books we keep and the returns we prepare. Without those, it would have to guess the very figures that make it useful.
Will you tell me what to do about what the reports show?
We will tell you plainly what the numbers show and what is causing it. We do not advise on anything that affects your tax, because that is a job for an accountant. If something needs an accountant or a financial adviser, we will tell you, and why.
What if the forecast turns out to be wrong?
No forecast is exact. Each month you see what actually happened next to what was forecast. We tell you whether a difference is just timing, which sorts itself out, or a real change, in which case we rebuild the forecast.
Primary sources and further reading
The tax dates in your forecast come from HMRC's guidance for each return we prepare. If this page and HMRC ever differ, HMRC is right.
See your cash thirteen weeks ahead
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