Double-entry for builders: construction accounting without the mystery
A construction firm that only tracks cash knows what it spent but never what a project actually cost or earned. Double-entry is the 500-year-old fix — and it maps onto site life better than most builders expect.
Most contracting firms start with a cash book: money in, money out, a running balance. It works until the first project of size, where the questions that decide survival are ones a cash book cannot answer: what has this project actually cost so far? What are we owed on certificates issued but unpaid? What do we owe suppliers who delivered but haven't invoiced? Are we profitable, or just liquid?
The idea, minus the jargon
Double-entry bookkeeping records every event twice — where money (or obligation) came FROM and where it WENT — so the books capture not just cash moving but debts forming and dissolving. Buy steel on credit and the cash book sees nothing; double-entry sees material cost arriving AND a supplier liability arriving, which is the truth of the firm's position that day.
| Event on the project | What is recorded |
|---|---|
| Steel delivered on 30-day terms | Project material cost ↑ · Payable to supplier ↑ |
| IPC certified, awaiting payment | Receivable ↑ · Contract revenue ↑ |
| Client pays the certificate | Bank ↑ · Receivable ↓ (revenue unchanged — it was earned at certification) |
| Month-end wages paid | Labour cost ↑ · Bank ↓ |
| Retention deducted | Retention receivable ↑ — money earned, parked, and too often forgotten |
The construction-specific layer
Generic accounting software does double-entry perfectly well — for a firm whose atom is the invoice. Construction needs the project dimension on every entry: costs coded to projects (job costing), revenue recognised through certificates (the IPC chain), retention tracked as its own receivable, and a chart of accounts that mirrors how the firm actually spends. Without the project dimension, the books are true in total and silent about everything that matters.
In Ofivio this is one spine rather than an integration: Ofivio Finance carries the double-entry books — chart of accounts, vouchers, trial balance, P&L, balance sheet — while project events (procurement, payroll, milestones) post into them from the systems where they happen. A firm that runs Build adds the Accounting dashboard; an accounting-led firm starts from Finance itself.
Books that know what a project is — double-entry with the project dimension built in.
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