Industry Insight – Project Bank Accounts Phase Two
As an early adopter of COINS' project bank account functionality, COINS Australia asked Ian Morrison, Managing Director of iQ Construct, how he is managing the legislative change to minimise the impact to his business.
How will Phase Two of the PBA scheme impact iQ Construct?
The short answer is it will mean a significant increase in administration. Further, it will mean stringent management and reporting of the financial viability of every single project to ensure each job has the means to fulfil its subcontractor payment obligations. From July 2022, all our projects will be subject to PBAs, so we need to ensure now that we are on the front foot of having a system in place to easily manage legislative requirements and minimise the risk of non-compliance.
What do you think the overall impact will be on the building and construction industry?
While the new legislation will mean an increase in overheads for contractors, I do think it will lead to an overall more robust industry. Construction companies will increase their diligence in managing individual project financials and subsequent subcontractor payments, which in general, will mean more integrity in business deals throughout the industry.
Why was it important to you to ensure PBA functionality was incorporated into your system prior to Phase Two legislation coming into effect?
We understood the legislation was likely to come into effect in the near future, so we wanted to be on the front foot of integrating a solution into our company that will simplify administrative requirements and easily support legislative compliance. We have undergone rigorous testing and are confident we are well prepared, company-wide, to transition to Project Bank Accounts.
What do you see as the key benefits of COINS’ PBA functionality for iQ Construct?
The key benefit is the simplicity of administration. COINS has taken the headache out of what would be an arduous task, that is prone to manual error. With COINS' PBA functionality, we know we are supported in meeting compliance obligations, this obviously decreases risk to our business and minimises what would otherwise be an ongoing expense if not managed well.
Another major benefit is the added reassurance we have worked with industry experts to install a vigorous and accountable system. COINS thoroughly understand the construction industry, is up to date with legislative requirements and know how to ensure compliance is met.
Managing compliance is an ever-increasing critical factor in the construction industry. How important is COINS in facilitating compliance and helping reduce business risk for iQ Construct?
COINS is very important. The company is directly engaged within our industry and understands legislative compliance to ensure we keep up with an ever-changing landscape in our market. COINS is a specialist industry solution and continuously develops and improves its software to ensure we implement industry best-practice processes in our business. The system as a whole, is critical to effectively managing our business, which in turn ensures compliance. It’s a challenging and demanding marketplace and to succeed we need accurate, real time information across our business. We know we have efficient and compliant processes in place to allow us to manage risk and make informed decisions at any given time.
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