Almost half of all financial documents submitted to the Queensland Building and Construction Commission (QBCC) are either incorrect or require clarification.
In a bid to help QBCC licensees meet their financial obligations, the QBCC is holding education sessions with accountants to help them better understand policy and reporting requirements.
The QBCC’s Commissioner Brett Bassett said the regulator’s Minimum Financial Requirements (MFR) policy was an important measure to help ensure licensees were financially viable.
“Licensees must pay all debts as and when they are due or they risk disciplinary action,” Mr Bassett said.
“They must also maintain internal management accounts to keep track of their financial position, and most are required to have a minimum level of assets before taking on work.
“Licensees supply their financial records to the QBCC on application for a licence, if they’re increasing their revenue capacity and on request if the QBCC has concerns with their financial situation.
“Our data from the last financial year shows that when the QBCC’s investigators receive financial documents from licensees, in 43 per cent of cases the information is either incorrect or needs clarification,” Mr Bassett said.
“Most of the clarifications and corrections are for minor oversights, and the QBCC’s financial staff check every document, request further details and clarify inaccuracies with the accountant.
“This can be an added workload for the licensee when their time is better spent growing their business, and this is why it’s important accountants get it right the first time.
“For cases with serious errors, we can issue a show-cause notice to the licensee for failing to meet MFR or failing to comply with an audit.
“In the worst cases we’ve seen financial reports that over-state a licensee’s financial position.
“Quite frankly, this is a recipe for disaster.
“If a builder has spent years in the industry building their business, they could lose it in an instant if the company collapses.
“People who are sub-contracting to that builder could also see their own livelihoods threatened if they’re caught up in a collapse.
“This is why falsely reporting financials can attract disciplinary action against the licensee.
“The building and construction industry is Queensland’s third largest employer, it’s essential to the State’s prosperity to help keep these businesses viable and profitable.
Mr Bassett said in an effort to foster improved accounting practises in the sector and provide education for accountants whose clients are QBCC licensees, a series of information sessions have been held.
“The first presentation was to members of Chartered Accountants Australia and New Zealand, with further presentations to be arranged with CPA Australia and the Institute of Public Accountants,” he said.
“Professional builders and tradespeople can benefit from taking professional advice from well-qualified and informed accounting professionals.”
Penny Ellenger, Queensland Regional Manager for CAANZ said the information sessions were a useful and practical upskilling opportunity for all participants.
“We were delighted to help facilitate the first of these sessions from the QBCC,” Penny said.
“It’s important our members maintain up-to-date knowledge of regulatory provisions so that, as trusted advisors they can appropriately assist their clients.”
Individual accountants who would like to be involved are urged to contact the QBCC to arrange a presentation.
For more information please contact the QBCC on 139 333 or via firstname.lastname@example.org.
Please call 139 333.