Construction Finance Systems for Builders and Contractors
When job costs arrive late, the WIP report is rebuilt in a spreadsheet every month and claims, variations and retentions are retyped into Xero or MYOB, we connect your job system and accounts so you can see what every job is really making.
- 20+ years connecting business systems
- Works with the accounting, job and CRM systems you already use
- Fixed quote after a free chat
The Problem
Most builders and contractors we talk to have decent software. A job system for the site and the contract, Xero or MYOB for the accounts, and a stack of spreadsheets holding it together. The trouble is the gaps between them. The job system says a job is on budget, but the subbie bills and the last fortnight of labour aren't in yet. The WIP schedule takes days to put together at month end. Retentions sit in a spreadsheet nobody fully trusts, and an approved variation never made it onto a claim.
The result is that you find out a job lost money after it has finished, and the bank balance tells you very little about whether the business is actually making a profit.
When you bring us in, we look at the whole path from estimate to subcontract, purchase order, timesheet, progress claim, payment schedule and payment, and find where numbers are retyped, delayed or lost. Then we fix the process and connect the systems so costs and claims are entered once, and the job cost, WIP, retention and cash flow reports come out of the systems instead of a spreadsheet.
You keep the software you know. What changes is that it agrees, and each month you get a picture of every job you can act on while there is still time.
Want the detail first? Our construction finance systems guide explains job costing, WIP, progress claims, retentions, cash flow and the systems behind them in plain English, for Australian building and trades businesses.
Run a trades or field service business on simPRO, AroFlo or ServiceM8 rather than building to contract? See trades and field service.
The Systems a Builder Usually Runs
Each piece does its own job well. The problems start where one hands over to the next.
Job or project system
Procore, Buildertrend, Buildxact, simPRO or similar. Holds the contract, budget by cost code, purchase orders, variations and often the progress claims.
Accounting
Xero or MYOB. Holds supplier bills, subcontractor payments, invoices to the client, GST and the bank: the numbers your accountant, the bank and QBCC see.
Estimating
An estimating package or a spreadsheet. The job budget starts here, and should become the cost codes the job is tracked against.
Timesheets and payroll
A timesheet app, paper sheets or the job system, feeding payroll in Xero, MYOB or a separate payroll package. Labour is usually the cost that arrives last.
Subcontractors
Subcontract agreements, insurances and licences, claims, payment schedules, retentions held, and sometimes recipient-created tax invoices (RCTIs) instead of subbie invoices.
The spreadsheets
The WIP schedule, the retention register, the cash flow forecast, the variations list and the claims tracker. Usually where the real process lives.
Where the Numbers Get Retyped
If more than a couple of these happen in your business every week, your month-end figures are built on re-keying.
- Purchase orders and subcontracts set up in the job system, then supplier and subbie bills keyed into Xero or MYOB again, often against a different job or cost code.
- Progress claims built in the job system or a spreadsheet, then the invoice retyped in the accounts, with retention worked out by hand each time.
- Variations approved on site or by email, added to a variations list, and only later (sometimes never) added to the contract value and the next claim.
- Timesheets entered for payroll, then hours re-entered or allocated to jobs separately, so labour shows up on the job weeks after it was worked.
- Every month, figures from the job system and the accounts pasted into the WIP spreadsheet so someone can work out percentage complete and over or under billing.
- Subcontractor claims checked against the subcontract, a payment schedule written up, and the payment and retention entered again in the accounts.
The Four Problems Behind Most Month Ends
Job costs arrive late
Supplier and subbie bills are entered when they arrive, not when the work was done, and labour reaches the job only after payroll. So the job cost report always lags the site, and an overrun shows up when it can no longer be recovered. More in job costing: are you tracking or just guessing.
WIP rebuilt by hand every month
Work in progress (WIP) compares what you have earned on each job with what you have billed. Most accounting software doesn't produce a construction WIP report, so it is pieced together in a spreadsheet, and the over and under billing figure your accountant journals depends on whoever built it that month. See construction WIP reports: what they are and how to calculate one.
Claims, retentions and variations out of step
Progress claims, payment schedules and retentions run on deadlines set by security of payment law, yet they are often tracked in spreadsheets and email. Retention release dates get missed, and approved variations never reach a claim. Read progress claims, payment schedules and the retention register.
Cash flow is a guess
A builder can be profitable on paper and short of cash in the same month, because claims are paid weeks after costs are incurred and retentions hold money back for months. Without a forecast built from the claim schedule and committed costs, the bank balance is the only guide. See a construction cash flow forecast from your WIP and claim schedule.
Building in Queensland? Accurate monthly figures also make QBCC Minimum Financial Requirements reporting far less painful for you and your accountant. Not sure where to start? Our guide to construction workflow automation covers what to automate first, and our construction workflow automation service shows a worked example, from supplier invoice to job cost.
The Reports Owners and Finance Managers Can't Get
None of these are exotic. They are hard to get only because the data sits in systems that don't agree.
- A monthly WIP report by job: contract value including approved variations, cost to date, forecast cost to complete, and over or under billing, without rebuilding it in a spreadsheet.
- Margin by job that matches the accounts, so the profit you think a job is making is the profit your accountant reports.
- A retention register showing what you hold from subbies and what clients hold from you, with release dates for practical completion and the end of the defects period.
- Unbilled and unapproved variations by job, before they are forgotten.
- A cash flow forecast built from your claim schedule, subbie payment dates and committed costs, not just the bank balance.
- Subcontractor position by job: committed, claimed, paid, retention held, and insurances or licences about to expire.
A Worked Example
This is a made-up business, put together from the kind of problems builders describe. It is not a client.
Before
Say you are a commercial builder running a handful of jobs at once. Your project managers use a job system for budgets, purchase orders and variations. The accounts are in MYOB, payroll runs from paper timesheets, and the finance manager keeps the WIP schedule and the retention register in spreadsheets.
Every month the finance manager exports cost reports from both systems, matches subbie bills to jobs by hand, chases project managers for percentage complete, and works out over and under billing for the accountant. Variations approved on site sit in an email until someone remembers them.
You suspect one or two jobs are going backwards, but you won't know which until the WIP is finished, well into the following month.
After
Subbie and supplier bills are coded to the job and cost code once, and flow between the job system and MYOB automatically. Timesheet hours reach the job each week. Approved variations update the contract value and are flagged until they are claimed.
The WIP report builds itself from both systems, with project managers only confirming cost to complete. Retentions held and owed are tracked by job with release dates, and the cash flow forecast reads the claim schedule and committed costs.
What changes: month end starts from numbers that already agree, and a job going backwards shows up while there is still time to do something about it.
What We Build and Connect
Process first, then the systems and data behind it. We don't sell software.
Job costing and WIP
Costs coded to the right job and cost code once, and a monthly WIP report your accountant can rely on.
- Budget against actual by cost code, from the estimate onwards
- Over and under billing worked out the same way every month
- Construction job costing
- Construction WIP reporting
Job system to Xero or MYOB
Your job system and accounts share the numbers automatically (an integration), so bills, claims and payments are entered once.
- Commitments, subbie bills and progress claims in step
- Exceptions reported rather than silently skipped
- Procore to Xero or MYOB
- Builder accounting software integration
Subcontractors and RCTIs
Subcontractor onboarding, claims, payment schedules, retentions and payments in one process.
- Insurance and licence expiry dates tracked before payment
- Recipient-created tax invoices produced and posted to the accounts
- Subcontractor management
- RCTI automation
Cash flow and dashboards
A forecast built from claims, retentions and committed costs, and one view of every job.
- Cash flow by week and by job, including retention releases
- Margin, unbilled variations and WIP across all jobs
- Construction cash flow forecasting
- Construction KPI dashboards
Who Does the Work
Kenomont is a business systems consultancy founded by Aaron Chambers, with 20+ years designing and connecting business systems. We work with businesses across Australia remotely and travel when a project needs it.
Our long-running work includes a purchase order approval system in daily use at a large retirement living provider since 2014, and a forestry export platform for Australian forestry companies, running since 2012. Both deal with the same thing builders deal with: costs, approvals and money moving between people and systems, and needing to agree with the accounts.
We can work alongside your accountant, bookkeeper, or the partner who set up your job system or accounting software.
How to Start
1. Free chat
A no-obligation conversation about what is going wrong, which systems you run and what you have tried. If we are not the right fit, we will say so. We reply within one business day.
2. Audit, if needed
If the cause isn't clear, the $5,000 Process & Systems Audit maps how jobs, claims, subbie payments and the accounts work today, and gives you a written report on what to fix first.
3. Fixed quote
We scope the work, agree how WIP, retentions and variations are treated with your accountant, and give you a fixed quote and a timeline.
4. Build and handover
We build and test against your real jobs, run it alongside the old spreadsheets until the numbers agree, then hand over with documentation. Support after that is available if you want it.
When You Don't Need Us
Plenty of builders don't. If you run a few jobs at a time, one job system and one accounting package, and the built-in connection between them (for example your job system's standard Xero or MYOB connector) is set up properly, that is often enough. The cheaper route is to have your bookkeeper or the software's support team check the settings, cost codes and tracking categories.
If the problem sits inside one product, such as setting up a claim template, that product's support team is the right place to ask. If you are choosing a job system, our Procore vs Buildertrend comparison is a good start, and the construction finance systems guide covers the wider choices.
We are most useful when the problem sits between systems or in the process: job costs that never agree with the accounts, a WIP report rebuilt by hand, retentions and variations tracked in spreadsheets, or reporting that needs data from several places.
Related Services
Other work builders and contractors often need.
FAQ
What does it cost to connect our job system to Xero or MYOB and get proper job costing and WIP?
Costs vary widely depending on the size of the business, how many systems are involved and how much needs to be custom-built, so we scope every project first and give you a fixed quote after a free initial chat. If you are not sure what to fix first, our $5,000 Process & Systems Audit maps your jobs, claims and accounts and gives you a written report on what to fix and in what order.
How long does a project like this take?
It depends on what is involved. Automating a monthly WIP report from data you already have is a much smaller job than connecting your job system, timesheets, subcontractor claims and the accounts. You get a timeline with the fixed quote, and larger work is staged so the first piece, usually the WIP report or job cost report, is in use before the next starts.
Do we need our own developer or IT person?
No. We do the design, build, testing and handover. We need time with your contract administrator or QS, whoever does the progress claims and the accounts, and access to the systems. If someone already looks after your systems, we work with them and document everything.
Will it work with our job system? We don't use Procore.
Usually, yes. Builders run all sorts of job and project systems: Procore, Buildertrend, Buildxact, simPRO, a builder-specific package, or a spreadsheet. What matters is whether the system lets data in and out, through a published connection point or an export. We check that in the free chat before anyone commits to anything.
We use MYOB, not Xero. Is that a problem?
No. We work with MYOB Business, MYOB AccountRight and Xero. Neither produces a construction WIP report or a retention register on its own, so the job is the same either way: get job costs, claims and retentions in step with the accounts, and build the reports from that.
Can you work with our accountant or bookkeeper?
Yes, and we prefer to. We agree with them how WIP, over and under billing, retentions and variations should be treated, then make the systems produce it the same way every month, so the month-end journal is a check rather than a rebuild.
Does this help with QBCC Minimum Financial Requirements reporting?
It helps with the numbers behind it. If you hold a Queensland builder licence, your annual MFR reporting relies on accurate, up-to-date accounts, and that is easier when job costs, WIP and retentions are already right each month. Your accountant still prepares and signs off the MFR figures; we make the underlying data reliable.
What happens if Procore, Xero or MYOB change how their connections work?
Vendors do change their connections from time to time, usually with notice. We build on their published connection points, document what each connection depends on, and set up alerts so a failure is noticed straight away, not at month end. Support after handover is available.
Should we replace our job system with a bigger construction package instead?
Not always. Fixing the process and the connections around the systems you have often goes further and costs less disruption. If you have genuinely outgrown them, we help you weigh the options honestly, and we keep Xero or MYOB for the accounts unless there is a clear reason not to.
Not Sure Where to Start?
Book a free chat and tell us where job costs, claims or the WIP stop agreeing. We reply within one business day. If the cause isn't clear, our $5,000 Process & Systems Audit maps your job system, subcontractor process and accounts and gives you a written report on what to fix first.
Or call 1300 470 091, email [email protected], or try the self-assessment.
Free Resource: Construction Financial Visibility Toolkit
A guide (PDF) to seeing job costs sooner, with a worksheet for working out what late job cost reporting costs your business and a step-by-step plan to fix it. No sign-up.
Get the Free ToolkitPart of our guide: Construction Finance Systems Guide
See also
Articles on this topic
- Construction KPIs: 12 Numbers Builders Should Track, and Where Each One Comes From
- From Progress Claim to Payment Certificate to Retention: The Paperwork Between Your Systems
- From Variation to Progress Claim Without Retyping: One Workflow in a Typical Building Business
- Why Builders Spend Hours Every Week on Paperwork (and Which Part Is Really Re-keying)