Q: What challenges can arise with WIP reports?

According to Viewpoint , construction accounting departments use spreadsheets for 59% of their processes, and project managers use spreadsheets for 45% of their work. This means, more often than not, project financials are being tracked manually. Managing spreadsheets can be great for some things, but not for constantly changing data on construction WIP reports. Manually entered data is not only outdated minutes after it’s updated, but it can also lead to other problems like: Human error in data updates Unnecessary double entry Inconsistencies in information All of these issues can be avoided with Buildertrend’s WIP reporting software. Updates are made in real time with the latest information, so you always know where each project stands.

Question 1

What is WIP in project accounting?

OGM Staff · Accepted Answer

Work in progress for project accounting is the total accumulated costs or revenue on a project that’s still in progress. Actual project costs and revenue for hours and expenses are tracked to understand the financial status of a job.

Question 2

How do you analyze a WIP report?

OGM Staff · Accepted Answer

A construction work in progress report can be analyzed in near real-time through a comprehensive report. You’re able to see accurate data for total construction billings, profit margins and cost to complete on individual jobs or all in-progress jobs.

Question 3

What challenges can arise with WIP reports?

OGM Staff · Accepted Answer

According to Viewpoint, construction accounting departments use spreadsheets for 59% of their processes, and project managers use spreadsheets for 45% of their work. This means, more often than not, project financials are being tracked manually.

Managing spreadsheets can be great for some things, but not for constantly changing data on construction WIP reports. Manually entered data is not only outdated minutes after it’s updated, but it can also lead to other problems like:

Human error in data updates
Unnecessary double entry
Inconsistencies in information

All of these issues can be avoided with Buildertrend’s WIP reporting software. Updates are made in real time with the latest information, so you always know where each project stands.

Question 4

Do you want a high or low WIP report?

OGM Staff · Accepted Answer

When it comes to your construction WIP reports, you want to find a balance. A high WIP report can mean your team is working on too much at once and not meeting their project deadlines. On the other hand, a low WIP report means too many things are sitting without progress due to issues like third-party delays.

Using WIP reporting software can ensure you’re always where you need to be. Check the status of each project regularly and make adjustments as needed before it’s too late.

Question 5

What is the construction payment process?

Emily Johnson · Accepted Answer

The construction payment process starts with the homeowner who pays the general contractor who then pays the subcontractors and finally these subs pay their suppliers. Getting the homeowner to pay invoices on time is vital to ensure all payments run hassle-free down the line.

Question 6

What are typical terms for construction payments?

Emily Johnson · Accepted Answer

There are a number of different construction payment terms. Typically, construction payments are due 30 days after an invoice. The flow of who gets paid when and whether or not a retainage is used are all up to the builder. Here are a couple items to consider:

Prepayment: Prepayment is required so contractors can secure materials, equipment and a crew. A typical prepayment runs about 20-33% of the job.
Net 10, 30 and 60: A net payment means payment is due 10, 30 or 60 days from the date of the invoice.
Pay-when-paid: This is a common clause in a contract that means the subs on the job will get paid when the homeowner pays the general contractor.
Retainage: When a general contractor withholds a percentage of a subcontractors payment until the job is finished.

Question 7

What are the different types of construction payments?

Emily Johnson · Accepted Answer

The most common type of construction payment is a net payment, meaning the invoice is due a set amount of days from the issue date. For longer projects, it’s typical to pay an upfront deposit and then to pay the contractor monthly until the job is finished.

Question 8

How do general contractors get paid?

Emily Johnson · Accepted Answer

The most efficient way to manage construction payments is by using a construction payment software such as Buildertrend Payment. Why? Because it takes the awkwardness out of asking for money. A written construction contract should clearly state the expected payment schedule. Once you have that contract in place, your clients will pay all invoices via email. No emails or phone calls begging to get paid.

Question 9

How should a draw request be submitted?

Allison Cobb · Accepted Answer

The process of submitting a draw request is to follow the schedule for submission, gather supporting documentation and complete necessary forms. Clear communication with the lender and an organized request results in timely payments.

Question 10

Who’s involved in the construction draw process?

Allison Cobb · Accepted Answer

The construction draw process typically involves the client, the contractor and the lender. If a third-party inspection is necessary, an inspector or architect is brought in to verify completion of milestones and to inspect the work for quality and accuracy.

Question 11

What are construction draws based on?

Allison Cobb · Accepted Answer

Construction draws are based on the agreed-upon draw schedule. The schedule may follow a milestone or monthly payment plan. These progress payments reimburse the contractor for labor and materials.

Question 12

What challenges do women face in the construction industry?

Julia Thompson · Accepted Answer

Women in construction may encounter gender stereotypes, barriers to advancement and the demands of balancing work and family responsibilities. But they don’t have to navigate these challenges alone. Organizations like the National Association of Women in Construction (NAWIC) offer education, networking and mentorship opportunities to help women build skills, connect with peers and grow their careers. Supportive employers and mentors can also help create pathways to success, whether on the job site, in the office or in leadership.

Question 13

How can women advance their careers in construction?

Julia Thompson · Accepted Answer

Women can advance their construction careers by gaining hands-on experience, pursuing relevant training and building relationships with mentors and industry peers. Developing skills in project management, budgeting and construction technology can open additional career paths. Finding an employer that supports professional development and provides opportunities to lead projects is another valuable step.

Question 14

How are companies encouraging women to join construction?

Julia Thompson · Accepted Answer

Construction companies are encouraging women to enter the industry through networking opportunities, mentorship and support for career development. Highlighting women in skilled trades, project management and ownership also helps candidates see a future in construction. Flexible work arrangements, including remote options for some office roles, can make these careers more accessible.

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