The Perfect Management Pack for Construction Businesses
- Jones Financial Accounts
- Dec 19
- 4 min read
Introduction - Perfect Management Pack
Most construction and engineering businesses don’t fail because they’re unprofitable. They fail because the board doesn’t see problems early enough.
I’ve worked with multiple of £500k–£10m construction and engineering businesses, and the pattern is always the same:
The board pack arrives too late
It’s written for accountants, not directors
It shows a generic P&L and balance sheet
It tells you what happened, not what’s about to go wrong
A proper management pack is not a compliance document. It’s a decision-making tool.
And this isn’t just for big businesses. In fact, smaller and fast-growing firms need this more, because one bad decision on cash, pricing, or workload can wipe out months of hard work.
In this blog, I’ll break down:
What information the board actually needs
How to present it clearly (even if you’re not an accountant)
What to track beyond the basic P&L
When in the month this information must land to be useful
This is exactly how we build management packs for JFA clients.
What Information the Board Needs to Be Aware Of (And Why)
The board does not need more numbers. They need the right numbers.
At a minimum, a construction or engineering board needs visibility over five areas:
1. Profitability – But Broken Down Properly
A single total profit figure is meaningless on its own.
The board needs to see:
Profit by revenue stream (repairs, installs, service, projects)
Profit by department
Gross margin vs overhead absorption
Why this matters:I’ve seen businesses showing £300k annual profit while one department was quietly losing £150k and being subsidised by another.
2. Cash Flow – Not Just the Bank Balance
Cash is not profit. And profit is not cash.
A proper management pack shows:
Current cash position
Short-term cash forecast (at least 8–13 weeks)
Known pressure points (VAT, PAYE, CIS, retention)
Without this, directors end up making decisions based on what’s in the bank today, not what’s coming next.
👉 Free download:13-Week Cashflow Forecast Templatehttps://www.jonesfa.co.uk/resources
3. Work in Progress (WIP)
WIP is one of the most misunderstood areas in construction finance.
The board needs:
Value of work completed vs invoiced
Cost to complete
Expected margin on live jobs
If WIP is wrong, profits are overstated and cash problems are hidden.
This is why many businesses think:
“We made £100k on that job… so where’s the cash?”
4. Working Capital & Debtors
Late-paying customers and supplier pressure don’t appear suddenly. They build slowly.
Your management pack should show:
Debtor days
Creditor days
Aged debtors
Retentions due vs received
This allows the board to act early, not firefight later.
5. Key Operational Drivers
Numbers should link back to operations.
For example:
Revenue per engineer
Labour utilisation
Overheads as a % of revenue
Hire costs vs ownership
This is how finance supports better operational decisions, not just reporting.
Visibility Matters – Not Everyone Is an Accountant
One of the biggest mistakes we see is boards receiving packs they don’t understand.
If your management pack:
Requires explanation every month
Is full of jargon
Has no commentary or recommendations
…it’s not doing its job.
A strong management pack:
Uses plain English
Includes short written commentary
Highlights what changed and why
Tells directors where to focus attention
At JFA, every pack includes:
Headline summary (1 page)
What’s going well
What’s slipping
What needs a decision this month
This is CFO-level clarity without complexity.
Tracking Actuals That Actually Matter
Generic P&Ls don’t tell you where performance comes from.
Instead, track actual results across:
Departments
Revenue streams
Cost centres
For example:
Fuel costs vs engineer utilisation
Subcontractor spend vs project progress
Office overheads vs revenue growth
Real example: One £2.5m contractor we worked with reduced overheads by 18% simply by seeing costs broken down properly, no redundancies, just clarity.
Timing: When the Board Should Receive the Pack
Timing is everything.
If your management pack arrives 3–4 weeks after month end, it’s already too late.
Best practice for construction & engineering SMEs:
Pack delivered within 7–10 working days
Key numbers reviewed monthly
Cashflow reviewed weekly (short version)
This allows:
Faster corrective action
Better pricing decisions
Confident hiring or investment choices
Late information creates reactive leadership. Timely information creates controlled growth.
Common Myths We See
“We’re too small for this.” Small businesses feel mistakes faster. This matters more, not less.
“Our accountant gives us accounts once a year.” That’s compliance, not management information.
“We don’t have time for this.” You’re already spending the time firefighting the consequences.
Practical Steps You Can Take This Month
Review your current management pack, what decisions does it actually support?
Split revenue and costs by department or service line.
Introduce a short written commentary each month.
Add a rolling cashflow forecast.
Set a deadline for delivery within 10 working days.
Key Takeaways
A management pack is a decision tool, not a compliance report.
Boards need visibility on profit, cash, WIP, and operational drivers.
Clear presentation matters more than more data.
Timing is critical, late information creates bad decisions.
If your management pack tells you what happened but not what to do next, it’s time to rethink it.
Wrapping up today's insights, tomorrow we simplify another accounting challenge.
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