Fractional CFO for Contractors

A fractional CFO provides senior financial leadership on a part-time basis — the strategic and analytical layer above bookkeeping. Typically that means owning cash flow forecasting, margin analysis, budgeting, financial reporting, banking and lender relationships, and the financial side of major decisions like taking on a division or buying equipment. A bookkeeper records what happened; a controller closes the books accurately; a fractional CFO tells you what the numbers mean and what to do next.

For a contractor specifically, the work is concentrated in five places: job costing accuracy, WIP and over/under billings, cash flow around retention and progress billing, budget-to-actual by job and by PM, and the reporting cadence that gets those numbers in front of decision-makers weekly instead of quarterly.

Three different jobs that get used interchangeably, usually by people selling one of them.

A bookkeeper records transactions — AP, AR, payroll entry, reconciliations. A controller owns the accuracy and timeliness of the financials: the close, the reconciliations, internal controls, making sure the numbers are right. A fractional CFO works forward from those numbers — forecasting, margin strategy, capital and lender decisions, pricing, and what the data implies about the next twelve months.

The practical mistake we see most often at $5M–$50M: an owner hires a controller expecting CFO thinking, or asks a bookkeeper to produce a WIP schedule. Both fail, and the owner concludes finance people can't help. If your books are inaccurate you need a controller first — a CFO forecasting off bad data just produces confident wrong answers.

Job costing breaks in a small number of predictable ways, and we work through them in order.

Labor rates that aren't real. Burdened labor rates that omit payroll taxes, insurance, or equipment time make every job look more profitable than it is. On one construction client, we found hourly rates inflated by missing labor-quantity data and had to rebuild the underlying dataset before any margin number could be trusted.

Costs landing in the wrong job, or in no job. Materials coded to overhead, subcontractor invoices posted late, equipment time never allocated. The P&L reconciles; the job costs are fiction.

Committed cost invisibility. If a PO or subcontract is signed but not yet invoiced, most systems show the job under budget. It isn't. It's committed.

Change orders tracked outside the system. Work performed and not billed is the most common margin leak in the trade. For an engineering client we recovered $600,000 in out-of-scope work that had been delivered and never invoiced.

No feedback loop. The most expensive failure. Job costing that surfaces a problem after closeout is a history lesson. We build alerts and a review cadence that put budget variances in front of the PM while the job is still running — which is the entire point.

A work-in-progress schedule shows, for every open job: contract value, costs incurred to date, estimated total cost, percentage complete, revenue earned, and amounts billed. The gap between earned and billed is your over- or under-billing.

Your bank and your surety ask for it because it's the only document that reveals whether you're borrowing against profit you haven't earned. Consistent overbilling means you're financing operations with customer money — fine until the backlog thins, then it's a cash crisis. Consistent underbilling means you're financing your customers' projects out of your own working capital.

Most contractors under $25M either don't produce a WIP schedule or produce one once a year for the surety, from memory, in a spreadsheet. Standing up a monthly WIP that ties to the general ledger is usually one of the highest-value things we do in the first ninety days, and it tends to improve how your lender and your bonding agent treat you.

Cash flow in construction is a timing problem, not a profitability problem, and it's fixable without a single new job.

We look at billing velocity first — how many days between work performed and invoice issued. Then retention: how much is outstanding, how old, and whether anyone owns collecting it. Then the mechanics of progress billing, which frequently stall on AIA paperwork nobody is confidently responsible for. Then payment terms against subcontractor and supplier terms, to see whether you're funding the gap yourself. Then a rolling forecast that accounts for the actual lumpiness of construction receipts, rather than a straight-line budget that has never once been accurate.

None of this requires more revenue. It requires the sequence to be owned by someone.

Trampetti prices financial work the same way as the rest of our engagements. The six-week assessment is a fixed project fee. Implementation is a project fee plus an ongoing maintenance fee. Ongoing fractional CFO or controller support is a flat monthly fee. Where the work is largely building automation and reporting, automation specialists bill hourly. There's no long-term contract on any of it — if we aren't performing, you can cancel at any time.

What drives the number: revenue and transaction volume, number of entities or divisions, how many open jobs you carry, the state of your existing data — a company with no reliable job costing takes longer because the reporting has to be built before it can be trusted — and whether you already have a bookkeeper or controller we're working above, or whether that layer has to be filled too.

Often yes, and the maths is usually straightforward. At $10M revenue, a single point of gross margin is $100,000. Most of the contractors we look at are leaving more than that on the table in unbilled change orders, underpriced work they can't identify, and jobs they'd have run differently had they seen the overrun in week three instead of at closeout. An installation contractor we worked with improved gross margin by seven points while scaling fast.

It's not worth it in three situations. If your books are so unreliable that there's nothing to analyse — hire a bookkeeper or controller first. If you're below roughly $5M, where the owner can still hold the numbers in their head and the money is better spent on sales. And if the real problem is that you're not winning enough work: no amount of financial reporting fixes an empty pipeline.

Go full-time when financial complexity genuinely requires daily senior attention — multiple entities, heavy acquisition activity, a capital raise, or an imminent sale — and you can carry the compensation. Below that, a fractional arrangement usually gives you better talent for less money, because a $10M contractor cannot attract the calibre of CFO a $100M one can, but it can afford a few days a month of that person's time.

The other honest reason to start fractional: most owners at this size don't yet know what they want the role to do. Hiring full-time into an undefined finance role tends to end badly for both sides. Build the function first, then hire into it.

We work in whatever you already run rather than selling you a migration. In practice that has meant QuickBooks, Xero, Odoo — Mike is Odoo certified — Procore, BusyBusy for field time, Salesforce, and a range of estimating and payroll tools, plus the reporting layer on top. Much of the work is integration rather than replacement: connecting field time capture to job costing so labor lands on the right job automatically, connecting the accounting system to a dashboard that surfaces budget variances without anyone rebuilding a spreadsheet, and eliminating the parallel spreadsheets people trust more than the system.

Where automation genuinely pays, we build it. For a property management client we took five operating workflows from unwatched to automatically checked, with no added headcount. For an installation contractor we built a custom estimating tool that has junior estimators producing work at a senior level. The tooling follows the structure, though — software layered on top of undefined processes just produces faster confusion.

Yes, through People360, which places trained remote team members in finance and accounting roles — AP and AR, payroll support, job cost entry, billing and reporting. This comes up constantly: an assessment identifies exactly what needs to happen weekly, and there's nobody with the hours to do it. Placing a trained person into a defined process works. Placing one into an undefined one does not, which is why we sequence it that way.

Financial visibility and operational structure are the same problem seen from two angles. A job overruns because nobody owned the schedule — that shows up as a margin miss. Change orders go unbilled because the handoff between field and office was never defined — that shows up as a cash problem. Fixing the reporting without fixing the process gives you an accurate picture of a business that still doesn't work.

Most clients arrive through one door and end up using both. The six-week assessment covers operations and finance together for exactly this reason, and the fractional integrator and fractional CFO roles are frequently the same engagement viewed from different sides of the house.