Sub Specialty Contractor

I'm wondering how everyone has their account structure set up in their respective ERP's?

We currently use Sage 100 Contractor and are evaluating different ERP systems and I'm starting to wonder if my inherited account structure is set up goofy compared to the rest of the industry. I came from the non-profit world so this is the first construction specific account structure I've been in contact with.

Sage 100 has the typical account code, cost type, and cost code. Then it also has a subaccount structure which can be set up per account but can also be based on the departments that are set up for the company. Then there are phases that are job specific.

Our cost types are labor, material, subcontract, equipment, other, sales tax, freight, and travel. These I think are fairly standard.

Then we have cost codes. It looks like cost codes were used more in the beginning of the use of our system but now we generally use 3 cost codes and then we have 10 or so that are specific to internal equipment costs. The 3 are for each of our divisions and then for payroll its broken into cost codes based on the original division cost code plus labor type (foreman, general foreman, apprentice). For example 2000 is division one and 2000.200 is a general foreman cost code but we know because of the 2000 it is division one labor.

Then we have these subaccounts that are set up as our different departments for all income statement accounts and then they are set up very specific to balance sheet accounts. For example our union payable has 15 different sub accounts to track the types of union payables separately.

To me the use of cost codes that designate the department as well as subaccounts that designate the department seems redundant. I can't figure out a reason as to why they are the same. Sage 100 pulls department specific reports based on the subaccount assigned not the cost code.

Then we use phases on the jobs sometimes to mirror the SOV or sometimes just specific types of work on that job. Or we may just use them to track change orders so we can pull costs that are specific to a change order.

So curious how you have your account structure set up. Specifically curious if you are in Sage 100, Spectrum, or Sage Intacct?

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Kelsey Emerick
Controller
Yellowstone Electric Co.
Billings MT
(406) 671-5699
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Hi Kelsey,

I think the answer to your question depends on what you are intending to do with the data. G/L accounts are used to drive financial reporting and compliance items. To me less is usually more. However, you need to be able to pass an audit and provide the right level of detail for management decision making. You need to determine what if anything does the organization do with the information (answers questions, improves projections, or checks a compliance box).

To your specific example regarding your separated departments that sounds pretty standard especially if they are different legal entities, but if you are talking about Divisions/Departments there may be other ways to facilitate "Operational Reporting". You may just need to tag projects with the Division/Department in their set-up and then create a project for each Division/Department to track each group overhead related expenses (you'll just need to make sure the projects map to overhead G/L's and not Direct Expenses). This is actually what I do, and I use it to facilitate my annual budget and projection process for overheads.

As for actual contracts cost tracking: all the construction companies I've worked for create a standard wbs structure to track direct expenses. Again, it depends on what you want to get out of it... If you don't have a process to review wbs level projections or use it as part of your feedback loop for performance and/or bidding, then how you track it just needs to facilitate billings.

Hopefully that helps.

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Luke Albert
CFO
IMI Inc.
Granite City IL
(618) 915-9284
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Original Message:
Sent: 07-24-2025 17:59
From: Kelsey Emerick
Subject: Account Structure

I'm wondering how everyone has their account structure set up in their respective ERP's?

We currently use Sage 100 Contractor and are evaluating different ERP systems and I'm starting to wonder if my inherited account structure is set up goofy compared to the rest of the industry. I came from the non-profit world so this is the first construction specific account structure I've been in contact with.

Sage 100 has the typical account code, cost type, and cost code. Then it also has a subaccount structure which can be set up per account but can also be based on the departments that are set up for the company. Then there are phases that are job specific.

Our cost types are labor, material, subcontract, equipment, other, sales tax, freight, and travel. These I think are fairly standard.

Then we have cost codes. It looks like cost codes were used more in the beginning of the use of our system but now we generally use 3 cost codes and then we have 10 or so that are specific to internal equipment costs. The 3 are for each of our divisions and then for payroll its broken into cost codes based on the original division cost code plus labor type (foreman, general foreman, apprentice). For example 2000 is division one and 2000.200 is a general foreman cost code but we know because of the 2000 it is division one labor.

Then we have these subaccounts that are set up as our different departments for all income statement accounts and then they are set up very specific to balance sheet accounts. For example our union payable has 15 different sub accounts to track the types of union payables separately.

To me the use of cost codes that designate the department as well as subaccounts that designate the department seems redundant. I can't figure out a reason as to why they are the same. Sage 100 pulls department specific reports based on the subaccount assigned not the cost code.

Then we use phases on the jobs sometimes to mirror the SOV or sometimes just specific types of work on that job. Or we may just use them to track change orders so we can pull costs that are specific to a change order.

So curious how you have your account structure set up. Specifically curious if you are in Sage 100, Spectrum, or Sage Intacct?

------------------------------
Kelsey Emerick
Controller
Yellowstone Electric Co.
Billings MT
(406) 671-5699
------------------------------