ACCOUNTING TELLS YOU
WHAT HAPPENED.
FINANCE DECIDES WHAT'S NEXT.
Accounting records transactions, reconciles accounts, and produces financial statements. Finance uses those statements to forecast cash, analyze job margins, build budgets, and make strategic decisions. Most subcontractors have accounting covered and no finance function at all — which is why the books are accurate and the business still runs out of cash.
A CPA prepares your taxes. A bookkeeper posts your transactions. Both are accounting functions — they describe the past. Nobody is asking: what will cash look like in eight weeks? Which jobs should we be chasing? What's our overhead rate costing us on every bid we submit? Those are finance questions. And for most subcontractors, nobody is answering them.
ACCOUNTING VS FINANCE:
TWO DIFFERENT JOBS.
Records, Reconciles, Reports
Posts transactions to the correct accounts. Reconciles bank statements. Produces a P&L and balance sheet. Files payroll taxes. Generates 1099s. Prepares year-end financials for the CPA. This is essential work. Without it, you're flying completely blind.
Analyzes, Forecasts, Advises
Uses the accounting output to make decisions. Forecasts cash 13 weeks forward. Identifies which active jobs are trending toward overruns. Calculates the overhead rate and applies it to every estimate. Advises on whether to pursue a new contract based on cash position and capacity. Manages banking relationships and bonding capacity.
The gap most subcontractors live in: Accounting is handled. Finance isn't. The books are clean. Nobody is using them. Transactions are recorded accurately and then nothing happens with the information until something goes wrong.
THE PRICE OF HAVING
ACCOUNTING BUT NO FINANCE.
Bids Use the Wrong Overhead Rate
Without a finance function, overhead rate gets calculated once and never updated. Costs change. Rate doesn't. Every bid for the next 12 months uses a number that's wrong by 5–10 points.
Cash Surprises Are the Norm
Without a 13-week cash forecast, the first signal of a cash problem is a low bank balance. By then you're behind on payables and need to borrow at unfavorable terms.
Job Overruns Show Up at Closeout
Without finance-level job cost review, a labor overrun on phase 2 doesn't surface until the project closes. The decision that caused it was made six weeks ago.
CFOS FILLS
THE FINANCE FUNCTION.
SPM provides both the accounting function and the finance function in one engagement. No scope gaps. No handoff. One monthly fee. See what's included →
