Why is record-keeping important for contractors?

Record-keeping is crucial for contractors primarily because it helps maintain documentation for disputes and compliance. This aspect of record-keeping ensures that all project-related documents, such as contracts, change orders, invoices, and communications, are organized and readily accessible. In any construction project, disputes can arise regarding contract terms, project scope, and payments. Having thorough documentation serves as a vital resource in resolving these issues, providing evidence that can support claims or defenses.

Moreover, compliance with local laws, regulations, and standards is essential in the construction industry. Proper record-keeping demonstrates adherence to these requirements, which is important for protecting the contractor's licensing and avoiding legal penalties. Therefore, a strong record-keeping practice not only facilitates the handling of disputes but also ensures compliance with relevant legal obligations, ultimately supporting the overall integrity and success of a contractor's business practices.