A comprehensive guide on contracting accounting and how it is applied
What is contracting accounting?
Contracting accounting is one of the accounting branches that make accounts for the costs of huge projects such as road projects, bridges and buildings. Considering contracting accounting as part ofCost accountingThrough which all the details related to the costs of the project are determined from the start and the tender, through the various equipment related to the project, until the completion of the project and its delivery to the responsible authority, as well as the document related to other accounting branches like Financial Accounting And the accounting administration .
Usually, companies that want to enter a tender purchases a brochure of conditions that clarify a detailed explanation of the subject of the tender and then study prices, in order to provide the works to the company that has put the tender, taking into account the payment of insurance entry to the tender or providing an elementary guarantee according to the conditions of the tender. In addition, there are a lot of accounts that are included in contracting accounting, such as: project cost account, customer account, payment account from customers, accountCustomer guarantee reserved. Each of these accounts has a framework through which accounts are divided.
How is the contract process?
After establishing the tender for the contracting company that offers the best offer and the lowest price according to the vision of the project owner, then the practical steps begin. Where the contract is made with the project owner, provides bank insurance, as well as business insurance documents, and ensuring that the document covers all the items in the booklet of conditions. The two parties sign the contract and agree to all conditions. In addition, the penalty clause for delivery is agreed upon at the specified date for the delivery of the project.
How are projects obtained?
Sources for contracting companies to obtain the projects that are being worked out into two parts: the private sector and the government sector, are the following:
How are the accounts in contracting accounting?
How is the tender items implemented and connected?
Pricing is divided into work sites and the required business items and estimated costs related to sites. On the basis of this, the actual disbursement of the stores, the treasury and the covenant of the sites is made. The implementation plan is the description of the project to be established, for example, it is described by the establishment of a residential building consisting of a number of floors with specific specifications for each floor and garage, in addition to a base.
Accordingly, this description is linked to the business items mentioned in the project's tender. The goal isDetermine the cost for each part of the projectAnd download it to the cost of items upon implementation; To compare the actual then through extracts at the estimated cost of each item. In addition, linking the implementation plan with business items helps to know the deviations for each of the tender item and the actual implementation duration and compare them to the previously estimated period.
How are the extracts divided into contracting accounting?
The extracts in contracting accounting consists of three types, namely: executive extract, financial extract, final extract. Each of them becomes clear:
Contracting accountant tasks
Try the program nowBefore reviewing the tasks carried out by the contracting accountant, it is necessary to know that there are joint tasks by any accountant. What may be of differences is the result of the nature of the activity or project that the accountant is working on, and from here it is possible to determine some of the tasks that the contracting accountant specializes specifically:
However, the most distinguished task of contracting accountant from other accountants is the preparation of production reports. This requires him to follow up the work completion rate periodically.
