How COVID-19 is impacting the construction industry

Written on Mar 26, 2020

By Nicole Fracasso, OSCPA communications intern


More businesses are being forced to shut down as COVID-19 spreads throughout the country. But like accounting, the construction industry remains an essential business, and Doug Houser, CPA, is trying to make sure work gets done.

Under normal circumstances, Houser’s primary responsibility is completing the audits and reviews for his clients, and ensuring he gets them to the right people in time so they can continue to operate and bid on projects that year. But with COVID-19 impacting the industry, his goal is to make sure he can still do business as usual but also to communicate coronavirus updates and guidelines with his clients.

“We need to make sure we’re having the conversation all together,” Houser said. “Not only the client and ourselves, but the banks and the bonding surety agent so we can talk through the issues (and) the impact, so everybody can understand how things look and how things are anticipated to go.”

In addition, Houser is giving weekly updates to construction firms on supply chain disruption and economic impacts, sharing industry guidance and operating practices and providing support and assistance with financial and tax needs.

One major way construction has been impacted is the delay of necessary materials. According to Houser, 16% of contractors are experiencing a delay or shortage in materials largely due to supply chain impacts from China.

“The biggest problem is going to be if there’s any delay or shutdown we have with regard to construction in the United States due to a shelter in place type of order,”

As for the future of the construction industry and COVID-19, Houser foresees some potential instances where construction is shut down, but not entirely.

“There could be some impact…” he said. “But what they may do is narrow the definition to essential construction projects.”

For example, construction on roads and hospitals could be considered essential while private commercial projects might be put on hold.

One of Houser’s favorite aspects of the industry is how interrelated it is. For instance, multiple construction companies sometimes work together toward the same goals. Organizations often seek to support each other and take a broader approach, he said.

“I try to use my experience in having a different background to help with that broad approach and think about all the things they need to help their business be successful,” Houser said. “Whether it’s in a time of crisis like today or normal times, which we hope to get back to here shortly.”

RELATED LEARNING: Quick Byte: GASB 89—Accounting for Interest Cost Incurred Before the End of a Construction Period

 

2 comments

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  1. Doug Houser | Mar 26, 2020

    ODOT has not announced any permissible delays in prequal or financial filings.  Our firm is proceeding as normal on this front.

    Doug Houser, CPA, MBA, CEPA

    Principal | Director of Construction & Real Estate Services

    Rea & Associates

    doug.houser@reacpa.com

  2. Mike Hickey | Mar 26, 2020
    Any conversations with ODOT related to delayed filings?

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