Supplier contract compliance for construction
Construction buying is fast and spread across many jobs. Materials arrive on site, rental equipment comes and goes, and invoices land in different offices. A partner firm can check whether supplier billing matches the agreed terms.
Fairview Audit connects construction businesses with partner firms. Fairview does not perform the review itself.
Why this category matters for construction
Most contractors buy under negotiated price lists, rental agreements or standing accounts with suppliers. Prices for materials move with the market, so the contract often sets a formula or a fixed list for a period. When the period ends, the invoice price should change with it. Sometimes it does not.
Equipment rental creates its own problems. Rates depend on the rental period, the unit and the terms for idle days. Return dates, pickup fees and damage charges are often recorded on delivery tickets rather than in the main contract.
Job costing adds another layer. A supplier invoice may be coded to the wrong job. The cost then lands on a project that did not use it, which can distort billing to the owner and your own margin reporting.
What a review typically examines
A partner firm compares what the supplier billed with what the agreement allows. For a contractor this may include:
- Material prices against the contract list or formula, including expiry and renewal dates.
- Volume or rebate commitments, and whether credits were applied.
- Delivery, fuel and environmental surcharges, and whether the contract permits them.
- Rental rates, billing periods and return dates against delivery and pickup tickets.
- Charges for damage, cleaning or lost items, and the evidence behind them.
- Duplicate invoices, or invoices for goods that the delivery ticket does not show.
- Tax treatment on materials that are incorporated into a project or resold to an owner. [VERIFY: how your jurisdiction treats these purchases]
- Whether invoices are coded to the jobs that actually received the goods.
Note: Supplier terms in construction are sometimes agreed by phone or by a site manager. If a price is not written down, say so early, so the partner firm knows where documents are missing.
What to have ready
- Supplier agreements, price lists and any amendments or credit applications.
- Rental agreements and rate schedules.
- A payment history for each supplier you want reviewed.
- Invoices chosen by the partner firm, with delivery tickets and purchase orders.
- Job cost reports showing where each invoice was coded.
- Emails or letters in which a supplier announced a price change or a new surcharge.
- Contact details for your purchasing staff, project managers and the supplier's account team.
- A list of problems you have already noticed.
How matching works
Start with the entry path that fits: larger business, smaller business or not sure or another need. There is no fixed size cut-off between the two types of firm. Your request goes to the matched partner firm, or to Fairview for manual matching. After that you talk with the firm directly. The engagement and any fees are between you and the firm.
The firm gathers data, presents findings with you involved, then agrees with you how to approach corrections with suppliers. For more detail, read how it works or the article on what to gather for a supplier contract compliance review.
An independent partner firm that specializes in supplier contract compliance handles this work. Fairview Audit makes the match. We do not perform the review ourselves.Who does the work
FAQ
Does this cover subcontractors?
Subcontract agreements are a different kind of contract from supply agreements. Ask the partner firm what it includes in scope. [CONFIRM: partner industry detail on subcontract coverage]
What if my supplier relationships are informal?
A review can still compare invoices with any written price list, quote or email. Missing terms are noted as part of the findings.
Will I have to change suppliers?
No. A review checks the billing you receive from the suppliers you already use. Any change of supplier is your decision.
Related pages
Read the parent page on supplier contract compliance and the construction industry page. Contractors with payroll and subcontractor cover should also see insurance premium audit for construction.
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