If you’re a contractor feeling unsure how to increase your overall bonding capacity, we’re here to help. Or maybe you’re not even aware of the current maximum bond value for which you’re eligible.
But by utilizing the right techniques, you could help boost your bonding capacity to sway in your favor.
Top Tips to Maximize Your Bonding Capacity
Carefully Select Your Bonding Agency
A bonding agency is typically considered an essential component of attaining a bond. However, agencies can vary hugely. While bonding agencies will work alongside the sureties responsible for financially backing the bonds, not all agencies work with the same companies.
As a result, market access and knowledge will fluctuate between different agencies. Be sure to do your research before making a final decision.
When seeking to attain a bond via an agency, search for options that only associate themselves with top-rated surety companies. Such a search may appear a little restrictive but is certain to boost growth and secure a greater bonding capacity overall.
Choose an Accountant Specializing in Construction
Sureties often require incredibly detailed financial history when concerning a large project. If you find yourself in this situation, working alongside a qualified construction accountant is essential.
Not only will they have far greater construction expertise than other accountants, but they know how to navigate multiple financial statements and accounting processes. These are some of the most vital factors in successfully increasing your bonding capacity.
Use the Best Possible Financial Statement Format
There are multiple types of financial statements available. A surety company’s decision can be largely influenced based on the statement format you choose to present. Choosing a statement format shouldn’t be too much of a hurdle, provided you have a professional construction accountant by your side.
The most common formats include review, audit, and compilation. Audit statements are considered the most thorough, with meticulous detail required. Many contractors instantly opt for audit statements for this reason.
However, some audit information may not even be relevant to the surety, making it crucial to take your particular circumstances into account when choosing a statement type. Project size is a very important deciding factor.
Maximizing bonding capacity is definitely doable, as long as you’ve got the right help and technique behind you. For more information and professional accounting advice, get in touch with MKS&H today.