EOFY for Builders: Are You Just Closing the Books or Really Reducing Risk?
4/5/25, 11:24 pm
TAAC
As June 30 approaches, most construction business owners go into “wrap-up mode.” You review your books, finalise your WIP, and maybe even run a quick chat with your accountant about tax.
But here's the truth: EOFY isn’t just about cleaning things up, it’s your one chance to stop leaks, reset priorities, and protect the year ahead.
Here are five things we’re seeing on the ground with real builders and what you can still do before June ends.
1. Your WIP Tells a Story. Make Sure It’s Not the Wrong One.
In almost every set of construction accounts we review, the WIP is where issues hide.
“We haven’t invoiced it yet, but the job’s basically finished.”
“The margin looks a bit high but we’re expecting to claw it back.”
That logic might pass internally, but to your bank, bonding agent, or insurance underwriter? It’s a red flag.
What to do now:
Sit down with your PMs and sanity-check cost-to-complete estimates. Are they conservative enough?
Don’t take margin on works that haven’t been validated with progress claims.
If any project’s slowing or in dispute, isolate it from your main results now. Don't let it pollute your whole balance sheet.
Why it matters:Strong, defensible WIP means stronger borrowing power and credibility when the next big tender comes in.
2. Your Fleet and Equipment Might Be Costing You More Than You Think.
Holding onto older utes, trailers, or plant equipment often feels “safer” especially in uncertain times. But idle, fully depreciated assets eat up working capital and don’t contribute to project delivery.
“We’ve got assets sitting in the yard, while site teams are hiring externally.”
What to do now:
Identify any underutilised gear and consider a sale or sale-and-leaseback before 30 June.
If you're replacing anything, check if you’re eligible for instant write-off or accelerated depreciation.
Use freed-up capital to cover more urgent expenses like retentions, incentives, or equipment needed on active sites.
Why it matters:It’s not just a tax strategy. It’s freeing capital stuck in metal, and putting it back into productivity.
3. Unpaid Progress Claims? That’s Where the Cash Drain Really Is.
We see this pattern all the time:The P&L looks fine. But the cash flow? Strangled.
“We’ve booked the revenue, but the client hasn’t paid the claim yet.”
“The job’s wrapped, but final payment is still in limbo.”
That’s not a technicality. That’s a liquidity risk.
What to do now:
Review all claims older than 30 days, especially retentions and finals.
Chase variations that haven’t been formally approved. If it’s in the scope but not signed off, it's not real money.
Crosscheck your AR ledger against project delivery and job status.
Why it matters:Strong cash unlocks options. Weak cashflow, even with profits, limits your ability to negotiate, hire, or scale.
4. Compliance Gaps Can Blow Up. Quietly, Then Suddenly.
In 2025, we’re seeing tighter scrutiny on everything from HBCF reporting to subcontractor compliance. These aren’t just admin tasks, they impact your license, insurance, and ability to win work.
“We didn’t update HBCF when our turnover increased.”
“Our subcontractor register hasn’t been refreshed in six months.”
What to do now:
Review HBCF thresholds. If your turnover or job profile changed, flag it before EOFY.
Check that all subs are current on insurance, credentials, and ABN status.
Make sure WHS registers and incident logs are current. If you had a near-miss, document it. Don't wait.
Why it matters:A clean audit trail buys you trust from regulators, partners, and lenders. A messy one? It triggers unnecessary scrutiny.
5. Bonuses Aren’t Just Tax-Deductible. They’re Your Talent Retention Plan.
We often hear:
“We’d like to reward the team but we can’t afford big bonuses right now. ”
“If we pay it before 30 June, at least it’s deductible, right?”
That’s missing the point.In a tight labour market, bonuses are not just tax tools, they’re workforce insurance.
What to do now:
Consider splitting bonuses across milestones, part before June, part tied to job completion or retention.
If cash is tight, structure deferred bonuses or offer time-based incentives (extra leave, RDOs, etc.).
Prioritise key people: PMs and site managers walking out post-June can cost you 10x their bonus in project risk.
Why it matters:You can’t deliver a job with spreadsheets. You deliver it with people. Keep them.
In Closing: EOFY Isn’t the End. It’s the Reset Button.
If you’re only seeing EOFY as a reporting exercise, you’re missing the bigger opportunity:To reset your margins, capital, and compliance posture before another unpredictable year begins.
At The Ark, we work with builders who want to stay sharp financially, strategically, and operationally.
If you want to talk WIP, cashflow, workforce strategy, or EOFY clean-up in plain English not just tax speak, give us a shout.
We’ll help you clear the decks, tighten your numbers, and set the next 12 months up with confidence.