ISSUE NO. 68

WEEKLY CFO BRIEF

A practical weekly field note from Basta CPA.

THIS WEEK'S STORY

More projects, more work… so where’s the profit?

Samy Basta, CPA

I see this with architecture and design firms all the time.

Revenue is up. New projects are coming in.

Everyone is busy.

Then we look at the financials and the owner asks: "Why aren't we making more money?"

Usually, I don't start with the P&L. I start with the projects.

Maybe you priced a project based on 500 hours and you're already at 550 - with another two months to go. Maybe the client keeps asking for revisions and nobody wants to have the awkward change-order conversation. Or your senior people are jumping in to fix things, but those hours were never in the original budget.

None of this looks dramatic day to day. That's the problem.

You lose the profit 5 hours here, 10 hours there.

By the time the project is finished, everybody worked hard - but you didn't make what you expected.

Quick note from your CFO
​If one project is going sideways, don't wait until it's finished to find out why. Fix the scope. Bill the additional work. Talk to the client. Adjust the staffing. I'd rather see you make $2 million at a healthy margin than $3 million while giving away your team's time.

Book your free 15-minute call

— What I Would Check This Week

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•✓•

Forget the entire company for a minute. Take a moment to step back.

•✓•

Take your three biggest active projects and answer four questions: 1. What did we expect to make? 2. How many hours did we budget? 3. How many hours have we used? 4. What will it actually take to finish?

— Deep Dive

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01

Know how much of that client deposit is really yours A healthy bank balance can be misleading when deposits are still owed as work, products, or refunds, and poor tracking can distort profit, taxes, and cash flow. ​Read more →​

02

Find out if your architecture firm is actually ready for an S-corp The tax election is only one piece; see why owner pay, cash flow, clean books, and the right legal structure matter just as much. ​Read more →​

03

Architects, catch margin problems before the project is over A full pipeline can still hide weak project economics if scope, fee burn, billing, and collections are not reviewed while there is still time to act. ​Read more →​

Basta and Company

100 Pine Street, Suite 1250
San Francisco, CA 94111

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