Masonry Magazine May 2003 Page. 39
If your company hires fulltime mechanics and you plan on adding an Equipment module, you may also need the option to charge their time to the pieces of equipment that they worked on. Find out how the payroll system tracks employee advances and what happens when an employee's deductions exceed the net payroll amount due them.
Accounts Receivable (AR)
CONTRACT BILLING may be part of AR or may be a separate module. Either way, the two are interrelated. Typically you will prepare most of your repeat billings at the same time each month. As such, it's nice to be able to run a report of all those "open" jobs you need to bill. When generating this report, the system should select out all those jobs that have a backlog remaining to bill and all those jobs that still owe you money. This report will be informational in that it should provide the date that the billing is due, the billing projection through date, the number of copies, etc. This way, you will not miss billing a job and you will get your bills in on time.
The Billing section should allow you to create your original schedule of values. Change orders should be added to your schedule of values automatically when they are approved in the system. Each monthly billing should remain within the Billing section to allow for easy modification should the general contractor revise the billing. It would also be nice if, when changing a previous billing, those changes automatically roll forward to all subsequent billings.
When setting up your next billing, all previous billing amounts should automatically be pulled in and the amount you bill for each line item on your schedule of values should be generated by simply changing the percent complete for that line item.
As for retainage, besides the simple 10 percent and five percent calculations on billings, the system needs to calculate retainage as a percentage of the contract value. For example, in some cases, once the job is more than 50 percent complete, retainage gets held at, for instance, five percent of the contract for the duration of the job. In some cases, retainage is reduced to a certain percentage after a certain overall percentage of completion on the job has been reached. For example, retainage gets reduced to five percent of billings, once the job is 50 percent complete.
The cover page that accompanies the schedule of values, that is a statement of your original contract amount, change orders, revised contract amount, billed to date, retainage, previous earned amount to date, current payment due, etc., varies by general contractor. Therefore, besides some standard templates, your software vendor should be able to customize the cover pages pertaining to GCs that have their own forms they require you to use.
Once the billing is done, the sale is recorded. When recording the sale, besides the obvious accounting effective date, there should also be a provision for specifying an aging date. This
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The Voice of the Mason Contractor
May 2003
Masonry 37