Here’s a dirty little secret: most contractors’ books are a mess — not because they’re doing something wrong, but because their chart of accounts was never built for decision-making.

Your chart of accounts is the backbone of your financial reports. If it’s too vague, too broad, or full of catch-all categories like “miscellaneous,” then your financial reports become meaningless.

You can’t make good decisions from bad data. And if your reports don’t clearly separate labor, materials, equipment, subs, marketing, admin, and overhead — you’re flying blind.

A contractor came to me frustrated that his profits never matched expectations. We reviewed his P&L — and it turns out his materials, subs, and labor were all lumped into one “Job Costs” line item. There was no way to tell what jobs were bleeding money or which crews were the problem. We rebuilt his chart of accounts from the ground up and added job-level tracking. Within 30 days, he caught a labor overage that was costing $9K/month and made the necessary personnel change.

Clean books = clear thinking = confident decisions.

Want your financials to actually tell you something useful?

Pick up your free copy of my new book, “The 7 Minute Conversation-How to Hear the Story Your Small Business Financial Statements Are Telling You-CONTRACTOR EDITION”.  Go to www.7MinuteConversationBook.com

Ready to find out where your cash and profits are really going? Book your free 15-minute Profit and Cash Flow Call with me. No pressure. Just real clarity. I’ll help you see where your money’s hiding — and what to do about it. Schedule at www.CashFlowCallWithLarry.com