2023 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 ten 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 meeting the requirements for each license group as follows:
(1) Group One
(a) bids and jobs not to exceed one hundred thousand dollars per job;
(b) required net worth of twenty thousand dollars or working capital of ten thousand dollars;
(c) on initial application, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy;
(d) on renewal, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy;
(2) Group Two
(a) bids and jobs not to exceed four hundred thousand dollars per job;
(b) required net worth of sixty thousand dollars or working capital of forty thousand dollars;
(c) on initial application, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy;
(d) on renewal, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy;
(3) Group Three
(a) bids and jobs not to exceed one million dollars per job;
(b) required net worth of one hundred fifty thousand dollars or working capital of one hundred thousand dollars;
(c) on initial application, a financial statement compiled by a licensed certified public accountant in accordance with Generally Accepted Accounting Principles (GAAP), including all disclosures required by GAAP indicating a required net worth of one hundred fifty thousand dollars or working capital of one hundred thousand dollars;
(d) on renewal, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy indicating a required net worth of one hundred fifty thousand dollars or working capital of one hundred thousand dollars, or a financial statement compiled by a licensed certified public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of one hundred fifty thousand dollars or working capital of one hundred thousand dollars;
(4) Group Four
(a) bids and jobs not to exceed three million dollars per job;
(b) required net worth of two hundred fifty thousand dollars or working capital of one hundred seventy-five thousand dollars;
(c) on initial application, a financial statement compiled by a licensed certified public accountant in accordance with GAAP, including all disclosures required by GAAP indicating a required net worth of two hundred fifty thousand dollars or working capital of one hundred seventy-five thousand dollars;
(d) on renewal, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy indicating a required net worth of two hundred fifty thousand dollars or working capital of one hundred seventy-five thousand dollars, or a financial statement compiled by a licensed certified public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of two hundred fifty thousand dollars or working capital of one hundred seventy-five thousand dollars;
(5) Group Five
(a) bids and jobs unlimited;
(b) required net worth of three hundred fifty thousand dollars or working capital of two hundred fifty thousand dollars;
(c) on initial application, an audited balance sheet prepared 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 three hundred fifty thousand dollars or working capital of two hundred fifty thousand dollars;
(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 ten 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 meeting the requirements for each license group as follows:
(1) Group One
(a) bids and jobs not to exceed thirty-five thousand dollars per job;
(b) required net worth of seven thousand dollars or working capital of three thousand five hundred dollars;
(c) on initial application, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy;
(d) on renewal, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy;
(2) Group Two
(a) bids and jobs not to exceed one hundred thousand dollars per job;
(b) required net worth of fifteen thousand dollars or working capital of ten thousand dollars;
(c) on initial application, an owner-prepared financial statement on a form prescribed by the board 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 two hundred thousand dollars per job;
(b) required net worth of thirty thousand dollars or working capital of twenty thousand dollars;
(c) on initial application, a financial statement compiled by a licensed certified public accountant in accordance with Generally Accepted Accounting Principles (GAAP), including all disclosures required by GAAP indicating a net worth of thirty thousand dollars or working capital of twenty thousand dollars;
(d) on renewal, an owner-prepared financial statement on a form prescribed by the board with an affidavit of accuracy indicating a required net worth of thirty thousand dollars or working capital 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 thirty thousand dollars or working capital of twenty thousand dollars;
(4) Group Four
(a) bids and jobs not to exceed four hundred thousand dollars per job;
(b) required net worth of sixty thousand dollars or working capital of forty thousand dollars;
(c) on initial application, a financial statement compiled by a licensed certified public accountant in accordance with GAAP, including all disclosures required by GAAP indicating a net worth of sixty thousand dollars;
(d) on renewal, an owner-prepared financial statement with an affidavit of accuracy indicating a required net worth of sixty 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 sixty thousand dollars or working capital of forty thousand dollars;
(5) Group Five
(a) bids and jobs unlimited;
(b) required net worth of three hundred thousand dollars or working capital of two hundred thousand dollars;
(c) on initial application, an audited balance sheet prepared by a licensed certified public accountant in accordance with GAAP, including all disclosures required by GAAP, and indicating a required net worth of three hundred thousand dollars or working capital of two hundred thousand dollars;
(d) on renewal, a financial statement on a form prescribed by the board reviewed 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 three hundred thousand dollars or working capital of two hundred thousand dollars.
(C) In reviewing an entity's balance sheet to determine the net worth or working capital 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 years' 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 or working capital 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 or working capital 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.
(F) Information contained in an applicant's financial statement is gathered for use by the department and board and may not be further disclosed.
HISTORY: 1998 Act No. 440, Section 1; 2016 Act No. 200 (S.280), Section 1, eff June 3, 2016; 2023 Act No. 69 (H.4115), Section 9, eff May 19, 2023.
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.
2023 Act No. 69, Section 9, rewrote the section.