For more information, contact our Construction Services group who specializes in construction accounting services, tax services, and management consulting services specific to the needs of construction companies.
Homebuilders and residential developers are two distinct business operations within the construction industry. EisnerAmper has a significant client base in both of these specialties. Many of our clients have organizations that perform both homebuilding and land development.
In addition to the normal complexity surrounding construction projects, homebuilding requires a significant sales and marketing effort as well as a strong customer service team. Streamlining all facets of the construction operation is essential to allow competitive pricing and expect reasonable profits. Residential development involves land acquisition, zoning and entitlement, site utilities, drainage and road construction, and sometimes a coordinated community marketing effort for multiple homebuilders.
The housing industry has been in a slump since the recession that began in 2007, which has caused many reputable builders to pursue bankruptcy protection, restructure debt, and/or seek outside investment capital. Projects have been constrained by the tightening of leverage requirements for home construction and site development financing.
Financial challenges are abundant as lower volume and tighter lending requirements allow for less cash flow into the organization for overhead. Consistent and disciplined operational controls are important so that sales, customer service, project management, field personnel, and your support teams are working together to service clients while protecting the company.
Overall company financial reporting can be challenging since a significant part of the financial statements involve estimating profits and costs to complete on projects. Organization structures typically include separate entities for each project with individualized financial reporting. Tax planning and accounting for income taxes is generally a priority for this industry segment.
EisnerAmper approaches each engagement with a big picture perspective, working across our many specialties to provide homebuilders with a comprehensive service solution that works for their specific needs. We offer a wide range of specialized accounting, consulting and tax services to meet the unique challenges faced by these contractors, including cash flow analysis, internal control reviews, and specialized financial reporting.