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Bookkeeping in Toronto – Things Canadian Contractors Need to Know

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bookkeeping

Construction and contractors have to meet specific bookkeeping requirements in Toronto, unlike firms in other industries. For instance, they have to manage revenues and expenses related to specific jobs at different locations. Retailers can account for revenues and expenses in a steady flow, whereas contractors have to manage bookkeeping in Toronto differently. You should also know that every bookkeeper, accountant, and Chief Financial Officer – CFO in Toronto are on the same page. Hence, contractors need to hire the right bookkeeper to minimize their overall tax burdens and maximize their company’s cash flow.

Things Contractors in Toronto Needs to Know Regarding Bookkeeping   

Here they are:

Accounting Methods for Contracting Firms:

Mostly, Canadian business owners rely on accrual-based accounting. Nevertheless, contractors with multiple projects at a time should opt for the percentage completion method. The percentage completion method allows contractors to recognize their revenues and expenses on their books once the project ends. Contracting firms can get a better picture of their financial health if they use the percentage completion method. Moreover, they may choose the completed contract method if they can’t estimate the percentage of the project completion.

The completed contract method suits smaller contractors who normally complete projects within a year. It also postpones the income because of the contract completion. However, the percentage completion method is suitable for most applications but requires ongoing bookkeeping work. It’s the ideal method for contracting firms when they are growing and taking on large projects with time.     

Accounting for Credit and Debit:

Usually, contractors depend on loans and access to lines of credit for buying supplies and paying workers before the client pays. Contractors and bookkeepers must know, in particular, how to record credit transactions. A debt is booked as a liability on the balance sheet under GAAP. A bookkeeper records it as a current liability if the balance is due within a year. Plus, a bookkeeper records it as a long-term debt if the business’s usual accounting cycle exceeds a year. 

Contractors need to depict all short-term/current and long-term debt on their income statements. They also need to put down principal payments due over the next five years on their income statements. Contractors have to disclose anything that serves as collateral for the loan on their company balance sheet.

Account for Holdbacks:

It’s crucial for bookkeepers to account for holdbacks properly while managing bookkeeping in Toronto for contracting businesses. Bookkeepers require to create separate receivable accounts for holdbacks. In other words, they need to create accounts for holdbacks that allow them for project allocations. Bookkeepers must create two line items; amounts owed and the amount of the holdback when contractors project new project invoices. Bookkeepers need to give the amount of the holdback a negative number on their books. It will ensure the two numbers net out against each other.  

Reports:

Every business owner and manager must carefully monitor the cash flow statements and balance sheets. Nonetheless, contractors have to monitor three more reports as compared to other businesses. They need to monitor the following three reports on a day-to-day basis:

  1. Progress Invoicing
  2. Job Costing
  3. Job Profitability

Each of the above reports depicts the profitability (or lack therefrom) down to the contract/job level. Monitoring these three reports also allows managers to know about approaching projects or entering unprofitability. As a result, managers can take the best action before any more damage befalls.

In addition to these things, contracting firms should review their bookkeeping processes consistently. It will ensure them the effective handling of their books and consequently make the right financial decisions.       

Standard Practice for Bookkeepers of Contracting Businesses

The standard practice for bookkeepers of contracting businesses includes the meeting of the following requirements:

  1. Bookkeepers should use a multitude of classes to manage bookkeeping for complex contracting businesses effectively.  
  2. They need to review construction reports regularly as construction managers rely on them.
  3. Bookkeepers should comprehend what they should do with accrued holdbacks.
  4. Additionally, bookkeepers for contracting firms need to utilize the right software to manage bookkeeping effectively. 
  5. Finally, bookkeepers for contracting firms should guide managers concerning things their books should have records about.

Furthermore, contracting firms may consider  outsourcing bookkeeping services from a reputable accounting firm, GTA Accounting 

Conclusion

Bookkeeping in Toronto follows different rules for construction and contracting businesses. Here are things that contracting businesses need to know about bookkeeping:

  1. Contracting companies should rely on the percentage completion method for most applications.
  2. Bookkeepers of contracting firms should account for credit and debit under GAAP.
  3. Bookkeepers need to create a separate receivables account for holdbacks.
  4. Contracting firms must monitor three additional reports, unlike other businesses, embracing progress invoicing, job costing, and job profitability.

Lastly, bookkeepers of constructing firms should follow the tips mentioned below as a standard practice:

  1. Using classes for projects
  2. Reviewing construction reports regularly
  3. Comprehending accrued holdbacks
  4. Using the right bookkeeping software
  5. Informing contracting firm managers about the essential bookkeeping records
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Business and Real Estate

How To Choose The Right Commercial Contractor For Your Project?

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Commercial Contractor

Choosing the right contractor for any building project is certainly going to be key to the success of the project itself. After all, the main contractor could very well be involved in every single detail of the project. With that in mind, we can’t really overstate the importance of finding the right Calgary commercial renovation contractors for your particular project. What should you be looking for though, when you’re out searching for that right contractor? The easiest thing to point out, yet potentially the hardest thing to find is a contractor that you know you can trust. If this person or company is going to be involved in every aspect of the project trust is key. How can you build that trust or reach a certain comfort level with a group of people that you potentially just met? 

The way that we see it, the contractor’s reputation has to speak for itself. This can make it hard for new companies to break into the market because as an investor what you probably want is someone with a proven track record. Staying on that subject of the proven track record another key to picking the right general contractor, commercial renovation oriented, is making sure they have experience in your niche. The term commercial building encapsulates so many different things. Yet, working on building a new hospital wing is not necessarily similar to setting up a restaurant. Making sure that the contractor you hire has experience with a similar project is another box that you potentially want to check.

The Price Tags Are All Over The Place

One of the things that you’re potentially going to find in your search for a contractor is that the price tags for the services of these contractors can be all over the place. Some of the more established companies in the region are going to have a high fee that you need to cover, and they won’t budge off that. On the other hand, up-and-coming contractors may be more willing to give you a bargain deal. More expensive work is not necessarily better work, but these companies are able to bring a higher level of experience to the table. This is in many ways what we’ve mentioned as the key to finding that right contractor. Finding the perfect balance between experience and a decent price with a sense of trust between both sides is pretty much all that you can ask for.

Make Of List Of The Things That Are Important To You

Should the company that you hire have experience with similar projects? That’s probably a must for sure! Is there a price tag that you don’t want to go over? What are other specific needs you have? If you make a list of the things that you want and you can cross reference that with what you’re being offered by the options that you look into you can make the selection process much smoother. Even if there is no perfect way to be able to find the right commercial contractor.

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Business and Real Estate

Why You Should by Custom Pins?

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Custom Pins

You can have custom pins made in any shape, size or variety. You might get a reproduction of your organization’s logo. There are various expert reasons you could do this, whether it be for special purposes, part of a uniform, or even a sponsorship for a non-benefit occasion. As an individual, you might need to have a family pin made to distribute at the yearly get-together. Then again, perhaps your book club is praising its fifth year together and you would like a method for celebrating the event. Something different that has filled in ubiquity is to have a wedding pin made to pass out to every visitor as memorabilia of your exceptional day. There are numerous different motivations to use this one-of-a-kind help. Individuals love substantial articles, regardless of anything the size or worth. Basically, individuals love the stuff! Regardless of the occasion, what is preferable to give over something modified that they can wear on their lapel, satchel, cap, scarf, or tie?

Custom pins are accessible is a few assortments. One such assortment is Cloisonne. Cloisonne is the method of brightening metal. The hard lacquer Cloisonne pin is a metal pin that is played with polish and afterward prepared at a high temperature to fix the paint. It is then cleaned. At the point when done in this mold, the pin is smooth across the top.

Another assortment is the delicate finish. Delicate finish custom pins additionally have veneer fill, however, they are air-dried instead of prepared. The fill sits lower than the metal edges that structure the frameworks of the pin. This style of pin isn’t totally smooth across the top. It has a fairly raised frame. The delicate finish is a more affordable option in contrast to the hard polish.

The bite the dust struck pin is normally found in metal shades. It very well might be shaded, however, most frequently isn’t. These are the main sort of pins that made be done three correspondingly.

The photograph scratched pin is an option in contrast to the finish pin when you are needing something with a ton of detail. This is a more slender choice than the hard or delicate veneer.

At last, there is the photograph arch pin. These custom pins are fitted with a copy of the image you give and the epoxy is streamlined from the top to a pleasant domed completion.

You can track down organizations online that offer this kind of altered work. Some have valuing data accessible on their sites while others expect you to submit data on their statement structure. The data they will require normally incorporates your contact data, a depiction of the sort of custom pins you are hoping to arrange, and a duplicate of your craftsmanship. When you present this structure, the organization will handle your statement solicitation and reach you with an expected cost. Prior to consenting to have any work done, make certain to peruse the reached terms completely. Ask about creation time, yet additionally delivering time. You need to ensure that your request will get to you in time for the planned occasion.

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Business and Real Estate

What are Micro-Credentials & what are their Benefits?

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Micro-Credentials

With rapid changes and development in technology, the current job structure has completely transformed. Many new job roles are emerging and becoming immensely vital for the organization. There is also a need for acquiring newer skill sets which means that the workforce has to gain new expertise to be able to flourish in the modern workforce. 

Micro-credentials become extremely important in this scenario as they are the best tool for upskilling. They are a feasible means of acquiring competencies that allow one to carry out job responsibilities effectively. 

Understanding micro-credentials 

Micro-credentials are mini qualification that allow an individual to gain knowledge or expertise in a given area or domain. The skills that these nano degrees provide are very narrow and limited to particular expertise. Unlike diplomas or degrees that take several years to complete, micro-credentials imbibe all the necessary knowledge in a short time frame. 

The expertise that you gain from these mini qualifications is immediately applicable to your job role. You can acquire a micro-credential in various fields ranging from social media marketing to even business communications. 

These nano degrees are offered as digital badges which are given after you have successfully acquired a skill. Along with universities and colleges, you can also get these badges at work through practical job training.  

Need of the hour 

The business landscape has shifted drastically after the pandemic as every industry has adopted newer technological tools. This has greatly impacted job roles as responsibilities have upgraded. Revamping of work culture and the introduction of modern tools including the digitalization of every sector has left vast room for upskilling. 

For example, the traditional form of marketing which was once the norm has now been replaced by digital marketing. Those part of the workforce who lost their job due to all these changes or are looking to adapt to the new work tactics can gain a lot from a micro-credential. 

Also, the millennials and Gen Zs are keener to acquire skills that are directly applicable to the workplace and benefit a lot from such digital badges. There are many benefits that micro-credentials have which makes them immensely popular and useful in the current times 

Benefit of microcredentials

Some of the main advantages that micro-credentials have are the following:

  • Practical skill-building 

In the age of micro content and bite-sized videos, everyone is looking for easier ways to gain new skills. Gaining any expertise is only useful if it is applicable to one’s current job role or can help them switch to something better. 

Obtaining a micro-credential has an edge over other qualifications here as it imbibes necessary training that can be immediately applied to one’s work. It also allows you to illustrate to your employers that you have the necessary practical knowledge needed for the job profile. Those who are looking to become technologically competent can make great use of this mini qualification as well. They can easily learn how to navigate through the digital landscape in a short time. 

  • Feasible to learn 

Talking of learning in a short time, not everyone can afford to go back to college or university to continually upskill. From a practical point of view, it makes no sense as it becomes a time-consuming and expensive way of learning. 

On the other hand, micro-credentials can be acquired in a smaller time frame without burning a hole in your pocket. 

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