My last couple of articles dealt with compiling job costs on the way towards developing a useful profit-loss statement. The so-called “P & L” is the bedrock of financial reports to a business owner. When constructed properly it ought to tell him at a glance how much money he is making (or losing), and why.
In the course of my consulting work I have looked at hundreds of contractor P & L statements, most of which were developed by the firm’s accountant. Unfortunately, many CPAs don’t understand our industry and thus do not properly construct a P & L suitable for a contracting firm.Read the full story »