Despite the need for collaboration and teamwork among construction industry professionals, the partnership between a contractor’s CPA and attorney is usually considered more of an afterthought than part of a planned service delivery.

Consider this scenario involving a contractor and its CPA and attorney: A contractor needs to create a new entity. The CFM/owner calls his attorney to discuss the matter, who then e-mails the contractor’s CPA to request his opinion on the tax elections. The CPA calls the attorney to request background information and raises financial questions the attorney didn’t discuss with the CFM/owner.

After a dozen phone calls and e-mails, an agreement is finally reached on the entity selection. Sound familiar?

Unfortunately, this inefficient communication and “problem-solving” occurs too often. If the CPA and attorney were already working together, then the CFM/owner could schedule a telephone conference so that all three could determine the best entity option and quickly work out the details.

The CPA’s decision-making is generally based on financial and income tax considerations, while the attorney’s is based on legal and defense ramifications. By gaining awareness and understanding of how the CPA and attorney approach different aspects of the same problem, the CFM/owner can better leverage the professional team by having them work together.

This article will illustrate the importance of getting the CPA and attorney to collaborate for the contractor’s benefit and how to achieve collaboration among the team.

When Should CPAs & Attorneys Work Together?

Let’s review some situations that require legal and financial perspectives to derive the best solution.