What Is A Construction Final Account?

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One of the quantity surveyors key and crucial responsibilities comes after a construction project has been completed in the form of a final account. This may be a term you have heard before but what exactly is a final account? Well, if this is what you want to find out, you are in the right place!
#QuantitySurveying #Construction #Infrastructure #FinalAccount #FA
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[@AceCPAsBookkeeping]

TLDR: The final account in construction projects is a crucial process that involves settling all financial matters, including variations, entitlement claims, and expenses, through joint and robust account preparation to reach a final agreement for full and final payment.
00:00 🏗 Final accounts are a crucial commercial milestone in construction projects, representing the agreed final payment between client and contractor.
00:54 🏗 Variations in construction works should ideally be proposed and agreed upon before reaching the final account stage, but in reality, there are usually contentious points to work through, such as rejected or disputed variations.
01:30 💡 Include all necessary documentation to prove the value of the works in the final account submission.
01:46 💡 Entitlement, loss and expense, and extension of time claims must be established with relevant documentation to justify additional money, and the sum claimed versus the sum payable needs to be assessed and listed.
02:14 🏗 Construction final account is the process of settling all financial matters at the end of a construction project.
02:15 💡 Organize a final account meeting to resolve any issues and agree on assessments, minimizing negotiations through joint and robust account preparation, resulting in a final account statement for full and final payment.
02:41 🏗 The final account in construction involves detailed audits of costs, representation of allowable and disallowable costs, and resolution methods for disagreements.

[@Metroun]

Thanks for your comment!

[@eshleyngomane9276]

Nice. Please make a video on cashflow forecasting

[@josephpenyisa1440]

Yah sure

[@Metroun]

Hello Eshley, thanks for your comment!
Cash flow forecasting is quite a big area, could you please let us know which area in particular you are interested in? Overall company cashflow or cashflow on a single construction project? Also, would you want to see it from a main contractor (Tier 1) or subcontractor (Tier 2) perspective? We will certainly be able to add this topic to one of our future videos though!
If you have any other video ideas please do let us know!

[@eshleyngomane9276]

@@Metroun apologies, construction project specific, from the main contractor's perspective.

[@CommonInvesting]

Hi, Did this ever get done? I would greatly appreciate if a detailed video of how to do a cashflow for a project, that would be very valuable@@Metroun

[@josephforrest9472]

If PA contractor fails to finish & refuses to provide a final account, should he be paid ? is there a time limi
t for providing a final account ?

[@Metroun]

Hello Joseph, thanks for your comment! Sorry to ask but could you please clarify what PA stands for in the context you've used it in?
In regards to the time line for providing a final account, there usually is a deadline but this is likely to change from contract to contract. From experience the most common deadline to submit a final account is 13 weeks after project completion, but the timeline would be stipulated within the specific contract particulars

[@josephforrest9472]

Thank you PA stands for Pennsylvania. I hired a contractor who walked off the job 2 days after I paid him a substantial deposit. Came back but failed to allow a " Punch list ", produced inferior work did not finish the job & refused to submit a final account. He is threatening to sue me.

[@Metroun]

Hello Joseph, we're sorry to hear that, it doesn't sound like a nice situation to be in at all. Of course it is hard for us to comment as we imagine it's a very complex situation but our advice would be go back and see what is written in your contract with them. Hopefully it will provide answers on how to deal with inferior work - or at the very least the next steps in dispute resolution.