Final Account
As Chartered Quantity Surveyors we have significant experience with final account preparation, submission and agreement on construction projects on behalf of our clients including private clients, architects, main contractors and sub-contractors. We can produce detailed and accurate final accounts in construction projects and ensure that a fair valuation of the works carried out on site is produced in a final account statement.
A Final Account prepared after practical completion in building contracts is an overall agreed statement of the total amount of money to be paid at the end of a building contract by the employer to the contractor. A final account creates a sense of finality to the negotiations leading up to the agreement of the Final Account between the parties to the contract.
The Final Accounts services which we provide to our clients include:-
- Statement showing the contract sum followed by all necessary adjustments to that sum
- Prepared in accordance with the terms and conditions of the relevant contract eg. JCT standard building contract
- All items fully assessed and adjustments made for variations, provisional sums, re-measured works etc
- Work carried out on a dayworks basis is included
- Loss and expense claims / reimbursement accurately assessed and included
- Fluctuations where applicable are included
- Confirmation of the contractor’s agreement to final account figure is obtained in writing
- Architect issues final certificate for final payment to main contractor
Preparing final accounts
Construction projects will generally result in a final cost that is significantly different to that which had originally been agreed between the client and the contractor at the outset of the project.
We are able to prepare a final account for a project based on the original contract sum as the starting point. The terms of the contract usually stipulate that the private quantity surveyor has responsibility for the final account preparation, however in practice the best approach is for both the client’s quantity surveyor and the contractor’s quantity surveyor to work together to produce an agreed final account
The main purpose of preparing and issuing a final account is for it to lead to the issue of a final payment certificate under the contract which signifies the contractor’s completion of its obligation to rectify defects. The final account also produces a statement setting out a clients financial liability under a contract.
The main contract well normally specify a period after the date of practical completion when the contractor is required to submit the final account.
Generally under most construction contracts the standard practice is for the main contractor to prepare and issue the architect or quantity surveyor with all necessary documents for the final account preparation not later than 6 months after practical completion. Then within three months of receipt of these documents the architect or quantity surveyor should prepare and ascertain the final account adjusted sum and send this to the main contractor. Both parties will generally work together to agree on the final account sum for the purpose of issuing a final payment certificate.
In preparing the final account statement the lump sum amount originally agreed between the client and the main contractor at commencement stage will usually require a number of factors and adjustment including
Contract sum
Variations including omissions and additions
Contingencies omitted
Provisional quantities and provisional sums
Loss and expense claims
Fluctuations
Any other matters or conditions under the contract
It is important that all relevant items are shown separately in the final account including the nett amount of each variation and other amounts are all listed with supporting evidence. When the contractor agrees with the final account statement and signs and returns it, it prompts the issue of a final payment certificate for the amount due to be paid to the contractor.
Any delays which occur in the settlement of the final account can cause additional costs to the contractor and in most cases the employer is anxious to know his ultimate financial commitment.
As Quantity Surveyors we work closely with the Architect to ensure that under the terms of the contract we keep to the date stipulated in the contract for preparation and completion of the final account and the contractor should promptly provide all subcontractors and suppliers accounts, agreement of measurement and prices, and the supply of all necessary supporting data.
Our Final Accounts Service
The final account service which we prepare for our clients at the end of the project after the practical completion stage is produced in a professional, efficient and accurate manner and then presented to the client for review.
If you are an architect, private client, main contractor or sub-contractor and require a final account preparation, submission and subsequent agreement please feel free to contact us to discuss your requirements.
final account preparation
We assess all the financial aspects of the project and gather all the necessary documents for preparation of the final account
account presentation
Our final accounts are presented in a professional and accurate manner taking into account all the relevant costs