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Construction Contractors: Special Tax and Accounting Considerations (4151115B)
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This course will provide you with a strong foundation and build your knowledge of the unique opportunities and responsibilities when representing construction contractors. You will gain an understanding of how a contractor’s financial statements are used to secure necessary financing; compare GAAP and tax rules for percentage of completion method of accounting; learn alternate methods of accounting for homebuilders, small-construction contractors and residential construction contractors; and div

12/4/2015
When: 12/4/2015
9:30 am.- 5:30 pm.
Where: Webcast/Webinar
Presenter: Don Paul Cochran, JD, CPA, CFP®, CRC®
Contact: April Deneault
801-834-6634


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This course will provide you with a strong foundation and build your knowledge of the unique opportunities and responsibilities when representing construction contractors. You will gain an understanding of how a contractor’s financial statements are used to secure necessary financing; compare GAAP and tax rules for percentage of completion method of accounting; learn alternate methods of accounting for homebuilders, small-construction contractors and residential construction contractors; and dive into the policies and procedures a contractor must have in place to generate the information used to assemble bids, report project results and prepare tax returns. You will also recognize accounting issues for joint ventures and variable interest entities, contractor-specific disclosure rules and accounting for uncertainty in income taxes, as well as tax issues regarding methods of accounting, look-back requirements, alternative minimum taxes and the Qualified Domestic Production Deduction.

Objectives:

  • Identify accounting and auditing issues unique to construction contractors.
  • Recognize standard tests for bonding capacity.
  • Determine audit risk in contractors’ financial statements.
  • Calculate and report liability amounts associated with uncertain tax positions and track annual changes.
  • Identify common situations involving variable interest entities and construction contractors.
  • Study disclosures required in financial statements of construction contractors.
  • Understand proper form for construction contractor’s financial statement. Including key supplemental information and disclosures.
  • Identify types of control systems needed by construction contractors.
  • Learn why construction contractors need special tax accounting rules.
  • Familiarize yourself with the exceptions to the application of construction contract accounting general rule.
  • Know the available construction contract accounting methods and limitations of each.
  • Apply rules in Treasury Regulations to the accumulation, classification and allocation of contract costs to contracts in process.
  • Understand the necessity of the look-back adjustment.
  • Recognize the procedures for changing accounting methods.
  • Recognize and apply alternative minimum tax rules.
  • Identify availability of the IRC Sec. 199 Qualified Domestic Production Deduction.
  • Determine the characteristics of relationships between service provider and service recipient that are indications of employer/employee relationship.

Major Subjects:

  • Over and under billings
  • Cost allocation and recognition
  • "Profit fade," accounts receivable and retainage
  • Consolidation of variable interest entities
  • Accounting for Uncertainty In Income Taxes
  • Risk and uncertainty disclosure
  • Audit program for contract-related items and applying risk analysis to contractors' operations
  • Tax: Cash vs. accrual
  • Accounting methods available to small contractors
  • Percentage of completion vs. completed contract
  • Look-back rules
  • Alternative minimum tax
  • Sec. 460 regulations relating to accumulation of contract costs
  • Homebuilder/developer regulation
  • Qualified Domestic Production Deduction
  • Independent contractors vs. employees

Advanced Prep:

None

Level of Difficulty:Intermediate
Field of Interest:Taxes
Prerequisites:Two to five years of tax experience. 

Designed For:

CPAs who prepare tax returns and financial statements or provide financial advice to construction contractors.

Member Price: $275

Nonmember Price: $375

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