Expense Management & Overhead Control
Document Type: Procedure
Version: 1.0
Last Updated: February 2026
Distribute To: Controllers, Department Managers, Project Managers
Purpose
Establish procedures for managing expenses and controlling overhead costs.
Expense Categories
Direct Costs (Job Costs):
- Labor
- Materials
- Subcontractors
- Equipment
- Job-specific expenses
General Conditions (Project Overhead):
- Superintendent salary
- Field office
- Temporary utilities
- Project-specific insurance
- Job-related travel
G&A (Company Overhead):
- Office rent
- Administrative salaries
- Insurance (general)
- Professional fees
- Marketing
- Technology
G&A Expense Control
G&A as % of Revenue:
| Performance | G&A % |
|---|---|
| Excellent | under 8% |
| Good | 8-10% |
| Average | 10-12% |
| Needs attention | over 12% |
Major G&A Categories:
| Category | Typical % of G&A |
|---|---|
| Salaries & benefits | 50-60% |
| Rent & facilities | 10-15% |
| Insurance | 8-12% |
| Professional fees | 3-5% |
| Technology | 3-5% |
| Marketing/BD | 2-5% |
| Other | 5-10% |
Budget vs. Actual Tracking
Monthly G&A Report:
================================================================
G&A EXPENSE REPORT
================================================================
Month: ______________ Year-to-Date Through: ________________
================================================================
| Category | Budget Mo | Actual Mo | Var | Budget YTD | Actual YTD | Var |
|----------|-----------|-----------|-----|------------|------------|-----|
| Salaries | | | | | | |
| Benefits | | | | | | |
| Rent | | | | | | |
| Utilities | | | | | | |
| Insurance | | | | | | |
| Prof fees | | | | | | |
| Technology | | | | | | |
| Marketing | | | | | | |
| Travel | | | | | | |
| Office exp | | | | | | |
| Other | | | | | | |
| **TOTAL** | | | | | | |
================================================================
Revenue (YTD): $____________________
G&A as % of Revenue: ________%
Target: ________%
================================================================
Expense Approval Matrix
Approval Levels:
| Amount | Approver |
|---|---|
| $0 - $500 | Department Manager |
| $501 - $2,500 | Controller |
| $2,501 - $10,000 | CFO/COO |
| $10,000+ | CEO/Owner |
Outside Budget:
Any expense not in approved budget requires next level approval.
Expense Reimbursement
Employee Expenses:
Reimbursable:
- Business travel
- Client entertainment (with documentation)
- Professional development
- Project-related expenses
Not Reimbursable:
- Personal expenses
- Commuting
- Unreasonable expenses
- Undocumented expenses
Expense Report Requirements:
- Submitted within 30 days
- Receipts for all items over $25
- Business purpose documented
- Appropriate approval
- Project charged if applicable
Expense Report Form:
================================================================
EXPENSE REPORT
================================================================
Employee: _________________________________________________
Period: ________________ to ________________
Project (if applicable): __________________________________
================================================================
| Date | Description | Category | Amount | Receipt? |
|------|-------------|----------|--------|----------|
| | | | | ☐ |
| | | | | ☐ |
| | | | | ☐ |
| | | | | ☐ |
| | | | | ☐ |
TOTAL: $________________________________________________
================================================================
Employee Signature: _____________________ Date: ___________
Approved By: ____________________________ Date: ___________
================================================================
Travel & Entertainment
Travel Guidelines:
| Item | Guideline |
|---|---|
| Airfare | Economy class, advance booking |
| Hotel | Standard room, approved rates |
| Meals | Reasonable, per diem or actual |
| Rental car | Economy/midsize |
| Mileage | IRS rate |
Entertainment:
- Business purpose required
- Attendees documented
- Reasonable expenditure
- Pre-approval for large events
Company Credit Cards
Card Policies:
- Business use only
- Monthly reconciliation required
- Receipts for all charges
- No cash advances
- Report lost/stolen immediately
Card Holder Responsibilities:
- Safeguard card
- Submit receipts monthly
- Code expenses properly
- Stay within limits
- Follow approval procedures
Overhead Allocation
Allocating G&A to Jobs:
Methods:
- % of revenue
- % of direct cost
- % of labor cost
- Per labor hour
Purpose:
- Full job cost visibility
- Pricing decisions
- Profitability analysis
Example:
Annual G&A Budget: $500,000
Projected Revenue: $5,000,000
G&A Rate: 10%
Project Revenue: $500,000
Allocated G&A: $50,000
Cost Reduction Strategies
Quick Wins:
- Review subscriptions/memberships
- Renegotiate vendor contracts
- Consolidate software
- Right-size facilities
- Review insurance coverage
Structural Changes:
- Process automation
- Technology investments
- Outsource non-core functions
- Headcount optimization
- Facility consolidation
Ongoing Management:
- Monthly budget review
- Variance analysis
- Benchmark to industry
- Challenge every expense
General Conditions Control
Project GCs:
| Item | Budget Method |
|---|---|
| Superintendent | Duration × rate |
| Project manager | Allocation % |
| Field office | Monthly rate |
| Temp utilities | Estimate |
| Temp facilities | Monthly rate |
| Small tools | % of labor |
| Cleanup | % of contract |
GC Monitoring:
- Budget vs. actual monthly
- Review at project meetings
- Adjust EAC if trending over
- Look for savings opportunities
Related Documents
- Invoice Processing
- Purchase Order Process
- Budget Management
- Financial Reporting
Template provided by support.construction. Control overhead, protect margins.