QuickBooks Premier® for Contractors

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QuickBooks Premier for Contractors

QuickBooks Premier for Contractors

For years, QuickBooks has done a nice job providing support to service-based businesses. With Premier Edition-Contractors, QuickBooks developed a program specifically designed to accommodate contractors and contractor-related businesses. This program tracks, bills and reports on material purchases and time from owners, employees and subcontractors.

A special navigator flowcharts the complete business cycle, providing a wonderful perspective to QuickBooks users who have no formal business training or are new to QuickBooks. All of the contractor’s operational tasks are shown in this window. Traditional accounting and management tools are included in various navigators and menus, such as receivables, payables, bank reconciliations and financial reports.

The key to using QuickBooks for Contractors successfully is its Estimate module, which uses Items to plan prospective jobs. Items are materials and outside costs, as well as labor for subcontractors, employees and owners. Various formulas, such as markup percent or add-on cost buildup, are available at the item level. Multiple lines of individual items can be built into Groups so that a consolidated line appears on proposals rather than the individual components. This offers a replacement to the spreadsheet as a scratchpad to estimate jobs.

The beauty of the “Estimate” is that contractors can issue Sales Orders, Invoices and Purchase Orders from the same original source of information. If the Estimate is changed, a Change Order is tracked by date and what changed. The invoice format can print a Progress Invoice that can be calculated by several different formulas, including billing by line item or a flat percent for all items. In essence, this provides full document control from a single source of information.

“Virtual bank accounts” is a QuickBooks feature that applies to contractors. When setting up the chart of accounts, sub-accounts can be established, which are also called “virtual bank accounts.” Typically, a contractor operates from one bank account for all project disbursements. For separate accountability, sub-bank accounts can be created for each major project. The bank statement (including all sub accounts) is reconciled as one single account. Each project has a sub-register that shows all cash flow activity associated with each separate project–a huge source of comfort for contractors.

Payroll processing, offered through a sister company, is fully integrated with QuickBooks and captures employee labor by employee, service or payroll type, and job. This information is then transferred seamlessly to customer invoices.

When the Purchase Order feature is used, and any time a vendor bill is entered, the program automatically detects outstanding Purchase Orders for that vendor and asks if the bill applies to them. Vendor information is maintained by job and overall company.

At the tail-end of the process are great reports well suited for contractors’ use in analyzing their business dynamics. Job costing, labor reports and subcontractor reports are included. The report generally considered most critical to a business’s ongoing viability is the unbilled hours/materials report. Other reports analyze jobs and items. In addition, the program has comparison reports showing estimated vs. actual costs.

Contractors Edition is well suited for smaller operations, as well as sizable and seasoned businesses. However, it sometimes falls short of expectations when complicated tracking routines for jobs are employed, especially for businesses that historically rely on a series of spreadsheets for information and management. Proper planning and implementation solves most of these problems.