Growing backlog doesn't always mean growing cash.
Accounting, controller and fractional CFO work for construction and trades, from a team that has closed these books before.
What we usually see when a contractor goes from $10M to $30M
The backlog is the best it's ever been and the bank account is the worst, because the company is financing its customers through retainage and slow draws while paying labor weekly. Over- and under-billings have never been calculated, so the P&L swings with whoever posted invoices that month. The surety wants a work-in-progress schedule the books can't produce. Margin fade shows up at job close, months after it could have been fixed.
The numbers we watch
— Work in progress by job, with over/under billings
— Job cost accuracy and estimated cost to complete
— Retainage outstanding and its age
— Backlog gross profit
— Labor utilization and burden
— Equipment cost recovery
— Bonding capacity against the balance sheet the surety sees
— Cash forecast against draw schedules
What we build
— A monthly WIP schedule the surety and the bank accept
— Percentage-of-completion reporting
— Job-cost review that catches fade at 40% complete instead of 100%
— A 13-week forecast on draw timing
— Bonding and lender packages
How the numbers connect
What the owner sees on Monday.
Everything to the right explains it.
Adds to cash
Draws
Billing lag, retainage
Takes from cash
Weekly labor
Utilization and burden
Subs and materials
Timing vs. draw schedule
Also watched
Margin
Estimated vs. actual cost to complete, by job
The tree shows how cash is built for this industry: what adds to it, what takes from it, and the measures behind each. It is the structure of the scorecard we build.
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