The final account is the comprehensive financial statement issued at the end of a construction project, summarizing all costs, payments, variations, and adjustments. It represents the final agreed amount due between the contractor and the project owner.
Why Final Accounts Are Crucial in Construction
Final accounts ensure that all contractual obligations have been met and that both parties agree on the total project cost. They provide a clear financial record, resolving any outstanding claims or disputes.
Key Elements of a Final Account
- Total project costs, including direct and indirect expenses
- Approved variations and change orders
- Final adjustments for retainage, Credit Notes, or penalties
Related Terms: Project Closeout, Retainage Release, Cost Accruals, Contract Settlement
FAQs
When is a final account issued?
A: Once all work is completed, the punch list is cleared, and outstanding financial matters are settled.
Who prepares the final account?
A: Typically, the contractor, in collaboration with the project owner and Quantity Surveyor (QS).