2017 South Carolina Code of Laws
Title 40 - Professions and Occupations
CHAPTER 11 - CONTRACTORS
Section 40-11-260. Financial statements; net worth requirements.

(A) An applicant for a general contractor's license or a general contractor's license renewal who performs or offers to perform contracting work for which the total cost of construction is greater than five thousand dollars, and an applicant for license group revisions must provide an acceptable financial statement with a balance sheet date no more than twelve months before the date of the relevant application showing a minimum net worth for each license group as follows:

(1) Group One

(a) bids and jobs not to exceed $50,000.00 per job;

(b) required net worth of $10,000.00;

(c) on initial application, an owner-prepared financial statement with an affidavit of accuracy;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy;

(2) Group Two

(a) bids and jobs not to exceed $200,000.00 per job;

(b) required net worth of $40,000.00;

(c) on initial application, an owner-prepared financial statement with an affidavit of accuracy;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy;

(3) Group Three

(a) bids and jobs not to exceed $500,000.00 per job;

(b) required net worth of $100,000.00;

(c) on initial application, a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with Generally Accepted Accounting Principles (GAAP), including all disclosures required by GAAP indicating a required net worth of one hundred thousand dollars;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy indicating a required net worth of one hundred thousand dollars, or a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of one hundred thousand dollars;

(4) Group Four

(a) bids and jobs not to exceed $1,500,000.00 per job;

(b) required net worth of $175,000.00;

(c) on initial application, a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP indicating a required net worth of one hundred seventy-five thousand dollars;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy indicating a required net worth of one hundred seventy-five thousand dollars, or a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of one hundred seventy-five thousand dollars;

(5) Group Five

(a) bids and jobs unlimited;

(b) required net worth of $250,000.00;

(c) on initial application, a financial statement audited by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP;

(d) on renewal, a financial statement reviewed by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP.

(B) An applicant for a mechanical contractor's license or a mechanical contractor's license renewal who performs or offers to perform contracting work for which the total cost of construction is greater than five thousand dollars, and an applicant for license group revisions must provide an acceptable financial statement with a balance sheet date no more than twelve months before the date of the relevant application showing a minimum net worth for each license group as follows:

(1) Group One

(a) bids and jobs not to exceed $17,500.00 per job;

(b) required net worth of $3,500.00;

(c) on initial application, an owner-prepared financial statement with an affidavit of accuracy;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy;

(2) Group Two

(a) bids and jobs not to exceed $50,000.00 per job;

(b) required net worth of $10,000.00;

(c) on initial application, an owner-prepared financial statement with an affidavit of accuracy;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy;

(3) Group Three

(a) bids and jobs not to exceed $100,000.00 per job;

(b) required net worth of $20,000.00;

(c) on initial application, a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with Generally Accepted Accounting Principles (GAAP), including all disclosures required by GAAP indicating a net worth of twenty thousand dollars;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy indicating a required net worth of twenty thousand dollars, or a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of twenty thousand dollars;

(4) Group Four

(a) bids and jobs not to exceed $200,000.00 per job;

(b) required net worth of $40,000.00;

(c) on initial application, a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP indicating a net worth of forty thousand dollars;

(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy indicating a required net worth of forty thousand dollars, or a financial statement compiled by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of forty thousand dollars;

(5) Group Five

(a) bids and jobs unlimited;

(b) required net worth of $200,000.00;

(c) on initial application, a financial statement audited by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP;

(d) on renewal, a financial statement reviewed by a licensed certified public accountant or a licensed public accountant in accordance with GAAP, including all disclosures required by GAAP.

(C) In reviewing an entity's balance sheet to determine the net worth of the applicant or licensee, the board may consider:

(1) deviations from the standard accountant's report;

(2) notes to the financial statement;

(3) additional financial information submitted by the applicant or licensee for renewals;

(4) personal financial statements of an entity's principals for an entity with less than two year's operating experience.

(D) If a licensee desires to change to a higher license group as established in this section, the licensee must meet the financial statement and net worth requirements in the higher license group number as required in initial application.

(E) If the board has reasonable cause to believe that an entity has not maintained the minimum net worth for its group, the board may order the entity to submit additional financial information, and, if appropriate, may modify the entity's license to reflect the appropriate limitation group.

HISTORY: 1998 Act No. 440, Section 1; 2016 Act No. 200 (S.280), Section 1, eff June 3, 2016.

Effect of Amendment

2016 Act No. 200, Section 1, rewrote the section, revising the net worth requirements for licensure and license renewal, and deleting obsolete language.