Contracting accounts: payment certificates, advances and the cost of each project
By Al-Arjan9 min read
A cost centre for each project
Without a cost centre, one project’s wages are mixed with another project’s profit. Every posting for materials, wages, a subcontractor or a site expense should be charged to a specific project. The 2026 third edition of the Unified Accounting System includes a treatment for contracting activity in the Board’s book (official source, checked 2026-11-10); your system’s accounts are designed with your accountant on that basis when needed.
This article stays on the accounting side. Site operations and the works schedule belong on the solution page, not here.
Payment certificates, advances and site materials
A payment certificate records what has been completed and claimed. The system stores the certificate number and value, what has been paid and what remains, and ties it to the project. Labour advances are recorded and then settled against what is due so they do not become an open amount. Site materials are either issued from a central store or bought for the site; in both cases they remain a cost on the project. Building-materials trading is a neighbouring path on building materials solutions if your activity is supply rather than contracting.
What a contracting-accounts system should show
Cost centre
- What is recorded:
- Every posting on a named project
- Why it matters:
- So results are not mixed
Payment certificate
- What is recorded:
- Value, payments and balance
- Why it matters:
- To know what the client still owes
Labour advances
- What is recorded:
- The advance and the settlement
- Why it matters:
- So an advance is not left open
Site materials
- What is recorded:
- Issues or purchases on the project
- Why it matters:
- For the true material cost
Profit report
- What is recorded:
- Project revenue versus cost
- Why it matters:
- To measure each contract on its own
| Item | What is recorded | Why it matters |
|---|---|---|
| Cost centre | Every posting on a named project | So results are not mixed |
| Payment certificate | Value, payments and balance | To know what the client still owes |
| Labour advances | The advance and the settlement | So an advance is not left open |
| Site materials | Issues or purchases on the project | For the true material cost |
| Profit report | Project revenue versus cost | To measure each contract on its own |
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The report compares certificate revenue with the cost of wages, materials, subcontractors and site expenses. If one of those lines is missing, the report misleads. Implementing this in one system is done through ERP services after a written proposal.
To ask about contracting accounts: WhatsApp us about contracting accounts.
Frequently asked questions
What should a contracting-accounts system show?
The cost of each project, payment certificates, labour advances, site materials, and then revenue versus cost.
Is this article about managing the construction site?
No. This is the accounting side only; site management is covered on the construction-management solution page.
What does implementing these accounts start at with Al-Arjan?
Through an ERP that starts from $3,000 over 3 to 6 months, as on the pricing page.
How are labour advances recorded?
An advance is opened on the worker or crew and then settled against what is due until the balance is closed.