Construction firms reduce close delays and strengthen accounting

Client background 

A group of nine related-party entities, including four core paving and grading construction companies, three property and holding companies and two ancillary operating companies, generated more than $59 million in annual revenue. As the businesses entered a growth phase and prepared for a partial sale, limited internal accounting resources created the need for construction accounting transformation to strengthen financial reporting, optimize processes and build a scalable foundation to support continued expansion. 

The business challenge 

The group’s rapid growth placed pressure on its small accounting team, which struggled to keep pace with complex reporting and compliance needs across multiple entities. Month-end close processes were irregular and financial data was often delayed. Inaccurate or incomplete calculations, particularly with percentage of completion accounting, risked misstating performance. 

The lack of standardized processes and training left the organization vulnerable. Leaders recognized that without more robust financial operations, they risked slowing expansion and jeopardizing the success of a potential sale. To move forward, the companies needed both immediate accounting support and a longer-term strategy to strengthen their internal operations. 

Strategy and solution 

Baker Tilly worked with the paving and grading companies to stabilize financial reporting, address prior inaccuracies and build a scalable accounting framework. The engagement combined CFO and controller services with operational accounting support, pre-diligence advisory and external audit preparation. 

Key steps included: 

• Conducting a deep dive into 2023 monthly financial activity to close all open periods. 
• Researching and recalculating 2022 percentage of completion figures to support a restatement of financials. 
• Executed a targeted workforce optimization initiative, including hiring an internal CFO, the vetting and upskilling of an internal accounting manager and experienced bookkeeper. 
• Providing oversight, training and process documentation to strengthen the internal accounting function. 
• Supporting external reviews to ensure accuracy and readiness for bonding initiatives and a partial sale. 
• Optimizing monthly close procedures to improve consistency and timeliness across entities. 

This approach delivered immediate improvements while creating an infrastructure that could support transformation. By embedding financial transformation services into process design, the companies established reliable systems that positioned them for continued growth and successful transaction readiness. 

Business impact 

The engagement produced clear results across the group: 

• Closed all 2023 monthly periods, giving leadership accurate and up-to-date reporting. 
• Restated 2022 financials with accurate percentage of completion calculations, improving transparency. 
• Improved audit readiness with reliable records and consistent processes. 
• Strengthened the internal accounting team through training, oversight and documentation. 
• Established standardized monthly close procedures that reduced inefficiencies and improved timeliness. 

Looking ahead 

With stronger systems in place and a foundation built for transformation, the group is positioned to expand confidently, maintain compliance and increase efficiency through digital solutions.