Monthly Close Checklist for Construction Bookkeepers

Why Construction Close Is Different

Most small business bookkeeping closes in a few hours: reconcile the bank, code transactions, and you're done. Construction is different. You have long-term contracts, retainage held back on every invoice, costs spread across dozens of jobs, and a WIP schedule that banks and CPAs require every single month.

Miss any of these steps and the financial statements are wrong — which means the contractor could be making decisions based on bad numbers.

The Complete Monthly Close Checklist

Week 1 — Transaction Coding

• Code all bank and credit card transactions to the correct job (customer) in QBO
• Ensure every bill is assigned to a customer/job at the line item level — not just the header
• Match all subcontractor bills to the correct job and verify against lien waivers
• Enter any owner-pay expenses (materials picked up on personal card, etc.)
• Post payroll journal entries allocated by job if using a payroll provider

Week 2 — Invoicing Review

• Confirm all AIA draw invoices have been created in QBO for the period
• Verify retainage amounts withheld are tracked correctly (separate line items or accounts)
• Check for unapplied payments or credits on customer accounts
• Follow up on any invoices more than 30 days outstanding

Week 3 — WIP Schedule

• Update estimated total costs for each active job (especially jobs over or under budget)
• Pull contract values from estimates in QBO
• Pull costs to date from bills and expenses in QBO (line-level job assignment)
• Pull billed to date from invoices in QBO
• Calculate % complete using cost-to-cost method for every active job
• Calculate earned revenue, over billings, and under billings per job
• Review any jobs with % complete over 100% — this usually means an estimate needs updating
• Review any large swings in over/under billing compared to prior month

Week 4 — Bank Reconciliation & Final Review

• Reconcile all bank accounts and credit cards to the statement
• Reconcile retainage receivable account balance to retainage amounts on open invoices
• Reconcile retainage payable account balance to retainage on open subcontractor bills
• Post over/under billing journal entries to the balance sheet (if on percentage of completion)
• Run P&L by job — verify gross margin on each job looks reasonable
• Run balance sheet — verify total assets and liabilities tie out
• Send WIP schedule to CPA and/or owner for review

The WIP Journal Entries

If your client is on the percentage of completion method, you need to post journal entries to put over/under billings on the balance sheet:

These entries are reversed at the start of the next month when you re-run the WIP.

Common Mistakes to Catch at Month-End

• Costs coded to overhead instead of a job — check for large general expenses that should be job-coded
• Invoices without retainage lines — verify every draw invoice has the correct retainage withheld
• Estimates not updated after change orders — contract value should reflect approved change orders
• Duplicate bills — subcontractors sometimes re-submit invoices; watch for duplicates in QBO
• Completed jobs still showing in WIP — jobs that are 100% complete and fully billed should be closed out

How Long Should Construction Close Take?

For a contractor with 5–15 active jobs:

• Transaction coding and invoicing review: 2–4 hours
• WIP schedule (manual in Excel): 2–4 hours
• Bank reconciliation and journal entries: 1–2 hours
• Final review and reporting: 1 hour

That's 6–11 hours per client, per month. For bookkeepers with multiple construction clients, this adds up fast.

The Faster Approach

The WIP schedule step — which takes 2–4 hours manually — can be eliminated entirely with the right tool. ReconcileBook pulls all the data from QuickBooks Online automatically: contract values from estimates, costs from bills and expenses (line-level job assignment), and billings from invoices.

The WIP schedule is generated in real time. No Excel, no manual formula errors, no re-pulling reports. The checklist above still applies — but the most time-consuming step takes 30 seconds instead of 3 hours.