Top 5 Subcontractor Bookkeeping Mistakes in Western Colorado

Your projects look profitable on paper, yet the bank balance keeps you guessing. The gap is usually tracking, not effort. Here are five bookkeeping fixes Western Slope subs use to turn reported profit into cash in the account. These are the issues I see most often in Delta County and Mesa County, and the simple ways to correct them this week.

1) Treating job costs like one big bucket

The problem: Expenses go to “Materials” or “Labor” without a job tag. You cannot tell which projects are making money, and change orders are hard to justify.
The fix:

• Turn on Projects in QuickBooks Online and assign every bill, expense, and timesheet to a job.
• Use a simple cost code list: labor, subs, materials, equipment, permits, overhead.
• Review job profitability weekly. If a line is trending high, address it before the job closes.

2) Losing track of retainage and progress billing

The problem: Retainage sits in Accounts Receivable forever or is mixed into regular invoices. Schedules of Values do not match the contract. Pay apps bounce back for corrections, which delays cash.
The fix:

• Track retainage as its own receivable account.
• Keep your Schedule of Values locked once approved, and list change orders separately.
• Use a pre-submission checklist for every billing cycle. If you need a refresher on AIA forms, read this guide: G702 and G703 Pay Applications for Subcontractors.

3) Mixing labor classifications and missing certified payroll details

The problem: One worker performs multiple roles in a week, but all hours land under one code. Overtime is miscalculated. Fringe is not handled correctly. Certified payroll takes hours to untangle.
The fix:

• In QuickBooks Time, or any time-keeping app, create selections for each Davis Bacon classification the crew might perform. Train the team to switch codes when the task changes.
• Record a separate line for each employee and each classification on WH-347.
• Pay OT on the base rate, and apply fringe to all hours as required. For a full walkthrough, use this article: Davis-Bacon Wage Reporting for Subcontractors.

4) Waiting until tax time to organize

The problem: Receipts live in glove boxes and email inboxes. Bank feeds pile up. Reconciliations get skipped. Tax season turns into a scramble and you miss deductions.
The fix:

• Snap photos of receipts into QBO, or any receipt-capture software, as you buy. Create bank rules for common vendors.
• Reconcile bank and credit cards by the fifth business day each month.
• Use this weekly rhythm: ten minutes to approve bank feed matches, ten minutes to file documents and flag any open questions.

5) Sending invoices and pay apps without complete backup

The problem: Billing goes out late or without required documentation. The GC asks for lien waivers, timesheets, or delivery tickets you did not include. Your spot in the pay run gets pushed to next month.
The fix:

• Build a billing packet every cycle: pay app or invoice, SOV or estimate, signed change orders, timesheets, delivery tickets, lien waivers, certified payroll if required, and photos if the GC requests them.
• Submit a day or two early when possible. That buffer saves you if a correction is needed.

Quick wins you can implement this week

• Turn on Projects in QBO and tag every new transaction to a job.
• Create two custom fields on bills: job and cost code.
• Add crew classifications to QuickBooks Time so workers can choose the right code.
• Start a simple “Billing Packet” folder template you reuse each month.
• Put two recurring reminders on your calendar: weekly twenty-minute tidy and monthly reconciliation.

Copy-and-use checklists

Weekly twenty-minute tidy

• Approve or fix bank feed matches
• Tag new transactions to jobs and cost codes
• Capture and attach any missing receipts
• Note open questions to ask the GC or supplier

Monthly close (target by the fifth business day)

• Reconcile bank and credit cards
• Review project profitability reports
• Update WIP if applicable
• Create next month’s billing packet checklist

Pre-submission pay app checklist

• SOV matches contract and approved change orders
• Percent complete and math checked
• Retainage calculation verified
• Backup attached: COs, timesheets, tickets, photos, lien waivers, certified payroll
• Submitted to the GC before the cutoff

Serving subcontractors across Western Colorado, including Delta County and Mesa County. If you want fewer surprises and faster payments, Western Slope Bookkeeping can help with job costing, G702 and G703 pay apps, certified payroll, and cash flow reporting.