Revenue Recognition

12 Months Ended

Sep. 30, 2020

Revenue Recognition and Deferred Revenue [Abstract]

Revenue from External Customers by Products and Services [Table Text Block]

4. REVENUE RECOGNITION

Contracts

Our revenue is derived from contracts with customers, and we determine the appropriate accounting treatment for each contract at its inception. Our contracts primarily relate to electrical and mechanical contracting services, technology infrastructure products and services, and electro-mechanical solutions for industrial operations. Revenue is earned based upon an agreed fixed price or actual costs incurred plus an agreed upon percentage.

We account for a contract when: (i) it has approval and commitment from both parties, (ii) the rights of the parties are identified, (iii) payment terms are identified, (iv) the contract has commercial substance, and (v) collectability of consideration is probable. We consider the start of a project to be when the above criteria have been met and we have written authorization from the customer to proceed.

Performance Obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

We recognize revenue over time for the majority of the services we perform as (i) control continuously transfers to the customer as work progresses at a project location controlled by the customer and (ii) we have the right to bill the customer as costs are incurred. Within our Infrastructure Solutions segment, we often perform work inside our own facilities, where control does not continuously transfer to the customer as work progresses. In such cases, we evaluate whether we have the right to bill the customer as costs are incurred. Such assessment involves an evaluation of contractual termination clauses. Where we have a contractual right to payment for work performed to date, we recognize revenue over time. If we do not have such a right, we recognize revenue upon completion of the contract, when control of the work transfers to the customer.

For fixed price arrangements, we use the percentage of completion method of accounting under which revenue recognized is measured principally by the costs incurred and accrued to date for each contract as a percentage of the estimated total cost for each contract at completion. Contract costs include all direct material, labor and indirect costs related to contract performance. Changes in job

performance, job conditions, estimated contract costs and profitability and final contract settlements may result in revisions to costs and income, and the effects of these revisions are recognized in the period in which the revisions are determined. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. This measurement and comparison process requires updates to the estimate of total costs to complete the contract, and these updates may include subjective assessments and judgments.

Variable Consideration

The transaction price for our contracts may include variable consideration, which includes changes to transaction price for approved and unapproved change orders, claims and incentives. Change orders, claims and incentives are generally not distinct from the existing contract due to the significant integration service provided in the context of the contract and are accounted for as a modification of the existing contract and performance obligation. We estimate variable consideration for a performance obligation at the probability weighted value we expect to receive (or the most probable amount we expect to incur in the case of liquidated damages, if any), utilizing estimation methods that best predict the amount of consideration to which we will be entitled (or will be incurred in the case of liquidated damages, if any). We include variable consideration in the estimated transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur or when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in transaction price are based largely on an assessment of our anticipated performance and all information (historical, current and forecasted) that is reasonably available to us. The effect of variable consideration on the transaction price of a performance obligation is recognized as an adjustment to revenue on a cumulative catch-up basis. To the extent unapproved change orders and claims reflected in transaction price (or accounted for as a reduction of the transaction price in the case of liquidated damages) are not resolved in our favor, or to the extent incentives reflected in transaction price are not earned, there could be reductions in, or reversals of, previously recognized revenue.

Costs of Obtaining a Contract

In certain of our operations, we incur commission costs related to entering into a contract that we only incurred because of that contract. When this occurs, we capitalize that cost and amortize it over the expected term of the contract. At September 30, 2020, we had capitalized commission costs of $94.

We generally do not incur significant incremental costs related to obtaining or fulfilling a contract prior to the start of a project. When significant pre‑contract costs are incurred, they will be capitalized and amortized on a percentage of completion basis over the life of the contract.

Disaggregation of Revenue

We disaggregate our revenue from contracts with customers by activity and contract type, as these categories reflect how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Our consolidated 2020, 2019, and 2018 revenue was derived from the following activities. See details in the following tables:

	Year Ended September 30,
	2020		2019		2018
Communications	$	395,141	$	321,246	$	219,655
Residential
Single-family	239,140		212,358		190,379
Multi-family and Other	172,650		100,978		95,332
Total Residential	411,790		313,336		285,711
Infrastructure Solutions
Industrial Services	40,701		48,948		44,701
Custom Power Solutions	87,678		87,842		52,462
Total Infrastructure Solutions	128,379		136,790		97,163
Commercial & Industrial	255,546		305,624		274,299
Total Revenue	$	1,190,856	$	1,076,996	$	876,828

	Year Ended September 30, 2020
		Communications		Residential		Infrastructure Solutions		Commercial & Industrial		Total
Fixed-price		$	309,567	$	411,790	$	121,922	$	241,864	$	1,085,143
Time-and-material		85,574		—		6,457		13,682		105,713
Total revenue		$	395,141	$	411,790	$	128,379	$	255,546	$	1,190,856
	Year Ended September 30, 2019
		Communications		Residential		Infrastructure Solutions		Commercial & Industrial		Total
Fixed-price		$	229,143	$	313,336	$	129,096	$	286,319	$	957,894
Time-and-material		92,103		—		7,694		19,305		119,102
Total revenue		$	321,246	$	313,336	$	136,790	$	305,624	$	1,076,996
	Year Ended September 30, 2018
		Communications		Residential		Infrastructure Solutions		Commercial & Industrial		Total
Fixed-price		$	166,258	$	285,711	$	90,155	$	244,464	$	786,588
Time-and-material		53,397		—		7,008		29,835		90,240
Total revenue		$	219,655	$	285,711	$	97,163	$	274,299	$	876,828

Accounts Receivable

Accounts receivable include amounts which we have billed or have an unconditional right to bill our customers. As of September 30, 2020, Accounts receivable included $10,710 of unbilled receivables for which we have an unconditional right to bill.

Contract Assets and Liabilities

Project contracts typically provide for a schedule of billings on percentage of completion of specific tasks inherent in the fulfillment of our performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statement of operations can and usually does differ from amounts that can be billed to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceeds cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in our Consolidated Balance Sheets under the caption “Costs and estimated earnings in excess of billings”. Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized are reflected as a current liability in our Consolidated Balance Sheets under the caption “Billings in excess of costs and estimated earnings”.

During the years ended September 30, 2020, and 2019, we recognized revenue of $34,035 and $31,831 related to our contract liabilities at October 1, 2019 and 2018, respectively.

We did not have any impairment losses recognized on our receivables or contract assets for the years ended September 30, 2020, 2019, or 2018.

Remaining Performance Obligations

Remaining performance obligations represent the unrecognized revenue value of our contract commitments. New awards represent the total expected revenue value of new contract commitments undertaken during a given period, as well as additions to the scope of existing contract commitments. Our new performance obligations vary significantly each reporting period based on the timing of our major new contract commitments. At September 30, 2020, we had remaining performance obligations of $505,352. The Company expects to recognize revenue on approximately $438,253 of the remaining performance obligations over the next 12 months, with the remaining recognized thereafter.

For the year ended September 30, 2020, net revenue recognized from our performance obligations satisfied in previous periods was not material.