Arkansas HVACR NewsMagazine January 2024

News Magazine January 2024

FEATURE STORY

These specialties would also have to meet the financial requirement as well as hold the proper trade license. Historically, the only difficult part of getting a Contractor’s License was the cost of preparing an AUDITED financial statement. There are alternatives to that now and we’ll look at that next. Privilege: ✓ An unrestricted license allows one to do work without bid restriction, i.e., if you are “bad enough” to get the job, more power to you. ✓ May contract with the Owner, Prime, or other Sub-contractor • Financials for license: ✓ Audited or reviewed financial statement of applicant’s year end or more current, prepared on a GAAP or accrual income tax basis by an Independent CPA or RPA. ✓ The financial must include CPA Opinion Page and Footnotes. ✓ Minimum Financial Requirement is a $5,000.00 net worth with a positive working capital with half in cash in the bank. May not include any assets not used for business, i.e., home, and personal property. ✓ A $50,000.00 bond as authorized by Ark. Code Ann. ξ17 -25-304(c) may be used in lieu of the financial statement. Unrestricted License •

Going Commercial?? It is inevitable that as a small company grows, there are opportunities to venture into commercial jobs. It is exciting and a boost to the ego to realize that you can “move on up”. There are some things that you must know to be legal and not get “suckered” into more than you need to take on. A Contractor’s Board License is required on all commercial jobs $50,000.00 or more (labor and material included). Fortunately, that does not apply to HVAC residential. That is because we already have a governing authority at the Department of Labor and Licensing, HVACR Board. Your HVACR license allows you to install up to the equipment size limits defined by your HVACR license in a residential application. However, when a commercial HVACR job hits $50,000.00 a Contractor’s License i s required. (Note: If the HVACR company is working directly under a prime contractor pursuant to a contract with the prime, a Subcontractor Registration is an option instead of a Contractor’s License. We’ll cover this a bit more later on.) There are two classifications of Commercial licenses you may consider. First, legal issues.

Heating, Ventilation, Air Conditioning, Refrigeration (HVACR) Refrigeration, Cold Storage

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