Construction Accounting Software Review – 2005

This year’s lineup of construction accounting packages represents some of the best packages built to handle the complex needs of project-based cost accounting. Like many businesses, there’s a lot more to making a construction business successful than simply reporting the historical debits and credits. For the contractor, the profitability of a job may be determined (for better or worse) long before the groundbreaking ceremony. The accuracy of the project manager’s estimates, including important items such as materials cost, labor cost, equipment cost and subcontractor costs, will determine the project’s financial success.

The packages reviewed here provide the tools to accurately estimate the job, as well as letting you observe and manage the process as it moves from contract to completion. This is accomplished by providing data input that lets you assign costs (direct and indirect) to the job, as well as providing specialized reports that help you to keep the pulse of the project. Other important aspects of most construction packages include scheduling and time management to make sure that tasks happen on time and in the right order.
Important considerations when shopping for a construction accounting package for your
business or client include the specific type of business, the volume of transactions that will be processed, and the number of anticipated software users. Construction-related activities fall into the broad categories of ‘project management’ or ‘service management.’

Project management usually involves construction of specific buildings, houses, offices or other one-of-a-kind projects. The company oversees and manages each project from beginning to end, whether the work is done by their employees or through the use of third-party subcontractors. Service management generally consists of smaller projects, but with more frequent occurrence. Examples of this type of industry are heating and air-
conditioning maintenance, plumbing, electrical, or almost any type of service that involves the use of skilled personnel to perform service-related tasks. Although many of the same
basic principles apply, the way each of these activities is handled within the software varies a good deal. Most of the packages reviewed provide modules for either of these activity types, although there are a number of packages that specifically cater to one or the other.

The volume of transactions to be processed determines the level of software that needs to be purchased. A small sole proprietor with a single bookkeeper needs less processing power than a national contractor with multiple locations and a large accounting staff. You should clearly define what your needs are as well as the operating limits of the software you’re considering. Several of the packages reviewed here provide very economical alternatives for the small single-user environment.

Since software is an investment that you’ll end up living with for many years, make the appropriate investment in time to assure yourself that the software can provide the features, tools and, most importantly, reports that you need. Each of these companies can provide a demo that you can try in your own environment. I would also like to encourage you to look beyond the ‘star rating’ of each of these products. A lower star rating generally translates into a more limited feature set, or a product with fewer bells and whistles. However, this may also mean a more economical package that still provides adequate information and reporting power. Every product here is worthy of consideration for a specific need and market segment.