Surety Company usually analyzes the bond submission. This favorably reviews the submission of material requirements of bond to make it complete review of finances and business operation of contract. The bond submission will vary for smaller contractors with more complex contractors. The smaller contractor can submit their forms as per their bond requirements while larger contractor can submit more complex.
Bond Submission Requirements
1. Financial Statements
Bond submission usually requires a guaranteed financial statement. The bonding companies require a guaranteed CPA-prepared financial statement. This statement is prepared in accordance with the accounting principles as per the percentage of completion revenue recognition for the fiscal year for the past four or five years. The bonding company also prefers the audited statement.
This statement should have list of work in progress with over billings and under billings shown in the balance sheet. This statement should also contain the records of completed contracts, to verify the gross profits schedule and the work-in-process schedule of the income statement. It should also contain equity reconciliation, cash flow statement, trading and administrative expenses.
The statement should be disclosed in a standard accounting principles. This helps the reviewer to analyze the financial statements. If any queries on this statement, the statement itself explain. It always prefers the bills of exchange i.e. bills receivable and payable to check the financial position of the concern.
2. Personal Financial Statements
Personal financial statement should be prepared for the fiscal year end with respect to the corporation. The personal financial statement should be prepared with mortgage balances, bank accounts, bills and loans. It should be reported along with the statement. Every stock holder should prepare this personal financial statement.
In preparation of personal financial statements, it is essential that any financial interactions with the corporation should be shown on the corporate statement and the personal statement.
3. Organizational Chart
The business entity should prepare an organization chart. This organization chart is highly required by the bonding company. Organizational chart is a detailed chart which is useful for verifying the functions and responsibilities of each employee.
4. Resumes
Employees Resumes is a most important requirement of the business. In a contracting business it is more useful and it is prepared to show the employees experience, qualification, responsibility, job profile and accomplishment.
Bond Submission Requirements
1. Financial Statements
Bond submission usually requires a guaranteed financial statement. The bonding companies require a guaranteed CPA-prepared financial statement. This statement is prepared in accordance with the accounting principles as per the percentage of completion revenue recognition for the fiscal year for the past four or five years. The bonding company also prefers the audited statement.
This statement should have list of work in progress with over billings and under billings shown in the balance sheet. This statement should also contain the records of completed contracts, to verify the gross profits schedule and the work-in-process schedule of the income statement. It should also contain equity reconciliation, cash flow statement, trading and administrative expenses.
The statement should be disclosed in a standard accounting principles. This helps the reviewer to analyze the financial statements. If any queries on this statement, the statement itself explain. It always prefers the bills of exchange i.e. bills receivable and payable to check the financial position of the concern.
2. Personal Financial Statements
Personal financial statement should be prepared for the fiscal year end with respect to the corporation. The personal financial statement should be prepared with mortgage balances, bank accounts, bills and loans. It should be reported along with the statement. Every stock holder should prepare this personal financial statement.
In preparation of personal financial statements, it is essential that any financial interactions with the corporation should be shown on the corporate statement and the personal statement.
3. Organizational Chart
The business entity should prepare an organization chart. This organization chart is highly required by the bonding company. Organizational chart is a detailed chart which is useful for verifying the functions and responsibilities of each employee.
4. Resumes
Employees Resumes is a most important requirement of the business. In a contracting business it is more useful and it is prepared to show the employees experience, qualification, responsibility, job profile and accomplishment.