Percentage-of-completion (PCM) is a technique of revenue recognition which occurs when a contractor records money based on how much of the project they've completed. Because PCM is an accrual approach, earnings are recognized when the contractor invoices, not when they are paid. Contractors can seek advice from construction CPAs on a variety of PCM approaches for determining how much of a project "count" as completed. Cost-to-cost approaches, physical completion methods, and labor methods are among them. For tax purposes, the IRS mandates contractors with revenue exceeding a specific yearly average or contracts of a certain length to employ this method.
Construction finance departments face inefficiencies from manual processes. RedHammer offers automation tools that streamline accounts payable, billing, payroll, and job cost reporting, improving efficiency and reducing errors and enhancing cash flow visibility.
Read MoreIntuit Enterprise Suite's Summer 2025 update brings AI agents that automate construction accounting, enhanced multi-entity management with intercompany sales, advanced business intelligence with KPI tracking, and project tools including deposits on estimates.
Read MoreBefore ditching QuickBooks Online, construction firms must carefully evaluate their growth-driven needs. Supplementing QBO with specialized apps like Knowify and Hammr can bridge functional gaps effectively, often providing better value than switching entirely to a complex ERP system.
Read MoreThe “Big Beautiful Bill”, OBBBA for short, pairs permanent tax breaks with a climate-smart infrastructure surge. RedHammer explains how modular workflows, automated certified payroll, new workforce grants, and careful cash-flow planning can turn strict federal compliance into margin and help contractors lock in the first, best-priced projects.
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