Construction Projects - Keeping an Overview of Your Data

Alexander Lang

From the initial idea or inquiry to the final acceptance of the construction or building, a construction project involves a lot of documents and data. Planning documents, drafts, cost estimates, calculations, offers, addenda, defects, etc. The accountants must capture a wide array of transactions related to the construction project: orders for materials , supplier invoices, receipt of invoices for outsourced services, payroll postings, incoming and outgoing payments, discounts, wages, and many more items.

How to keep track of all those numbers?

In my view, this is only possible by using an integrated solution. The construction project plays a crucial role in this regard. All processes and procedures are linked to the construction project. This creates a kind of digital project folder containing all relevant figures and processes.

The first relevant key figures come up during the planning phase when the first cost estimate is carried out, or, at the latest, when the first concrete calculation is done. This results in the preliminary budget for the construction project, which ideally includes a cost budget and a sales budget with a contribution margin.

As the project progresses, the construction cost planning changes due to new insights or changing framework conditions. This leads to new budgets. The actual expenses, such as from incoming invoices and time confirmations from employees, are directly taken from the budget. This makes plan vs. actual or even target vs. actual comparisons very easy.

Project controlling - transparency on all levels

Controlling can take place on various levels when it comes to a construction project. The first impression should already give you an overview of the project. Which costs have been planned, which costs have been incurred, and which services have been invoiced? An individually defined indicator can help you assess the current status of the construction project. The project manager and the construction manager should be involved in this process. The identification of unusual values on the level of the construction project makes it necessary to get the next level involved and to check the key figures on the level of the construction projects, the bill of quantity or the implementation project. On the one hand, site measuring can help you in determining which services have been provided but have not yet been invoiced, or which costs should have been incurred up to the current stage of the project. On the other hand, it is the construction progress which is determined or estimated by the construction managers. The collected data indicates which work still needs to be done and which remaining costs will be incurred. Potential cost overruns can also be recognised early on.

Figures in context

Of course, the controlling of incoming and outgoing payments is essential as well, especially with regard to potential discounts. These key figures - among others - can also be monitored and systematically evaluated based on the link to the construction project.

Much of the data and many of the values mentioned are directly available in our COSMO industry solution for the construction industry. However, there are many reasons why reporting should take place outside the ERP system. Using Power BI from Microsoft Power Platform - also directly integrated into Microsoft Dynamics 365 Business Central - you can obtain a dynamic analysis across all construction projects, tailored to your exact requirements.

Share post

Contact us
Alexander Lang
Industry Manager Project | COSMO CONSULT