top of page
  • Writer's pictureThomas Tsang

Construction contract audit

The key area in audit of construction contract is the measurement of percentage of completion for recognition of Revenue over time. The company must prepare a so called construction project accounting. It must keep track all the costs incurred project by project, a budget, billing since commencement to the end of the project. Whether input or output method to measure the percentage of completion, the budget of the project is a key and involove judgemen.

To perform the audit is on project base, not invoice base. It is totally different from those manufacturing, trading, wholesale or retailing.

18 views0 comments

Recent Posts

See All

Prior year error

When there was a judgement made in prior year without concrete evidence of support. The audit should have qualified it. When in subsequent year, the judgement is changes with the intention to correct

Impairment test under US GAAP

Under US GAAP, the carrying amount of the assets is compared to the undiscounted future cash flow of the assets generated. If the amount of undiscounted cash flow is highr than carrying amount, no im

Discount on enterprise value

When apply discount on lack of marketability (DLOM) and lack of control (DLOC) on enterprise value (EV), it is a multiple of EV x (1-DLOM) x (1-DLOC). But apply the discount on Equity value would lowe


bottom of page