Funds Administration is specific to the Construction Industry. Funds Administration is the outsourcing of accounting on a per project basis. By using a Funds Administration the Surety Bond Companies, General Contractors, Property Owners/Developers and Subcontractors have assurance that funds intended to pay the bills of a specific project will indeed be used for those bills and not diverted to some other use.
Unlike traditional outsourcing service, we consider ourselves serving 2 clients when we do Funds Administration. The company for which we are paying the bills is our client in the traditional sense, but we also provide the company that requested the service (i.e. the Bonding Company, etc.) with reports to keep them informed as to the status of the project.
Benefits of Funds Administration:
- Allows contractors to sub out work to companies with questionable credit
- Gives contractors assurance that job costs are being accounted for correctly
- Gives contractors assurance that job materials are being paid for
- May allow a contractor or sub to avoid purchasing a surety bond on a project
- May allow a Surety Bond Company to issue a bond where they normally wouldn’t
- Provides all the other benefits of outsourcing your accounting