Category: Contracts & management
Prepared by Eng. Ahmed Fathy, Projects Manager ·
Definition
The final account is the last payment statement that fixes the final contract value after completion: quantities actually executed, approved variations, provisional sums settled, deductions and damages, and retention due for release.
Why it matters on a project
Delaying it locks up retention and guarantees and leaves disputes open. Closing it quickly needs records kept throughout the project, not only at the end.
Measurement and pricing
The last interim payment plus adjustments and variations, less previous payments and recovered advance, gives the balance due.
Worked example
Contract 3,000,000 SAR, quantity increase 120,000, variations 85,000 and a 40,000 deduction: final value 3,000,000 + 120,000 + 85,000 − 40,000 = 3,165,000 SAR.
Common mistake
Leaving verbal variations unrecorded until the end, then trying to prove them in the final account.
Frequently asked questions
When is the final account submitted?
Usually after taking over, within the period the contract sets.
Is retention released with the final account?
Part at taking over and the rest after the defects period, per the contract.
Related terms
- Payment application (IPC)A periodic payment request based on approved progress and executed quantities.
- Variation order (VO)A written instruction changing scope, quantity or specification, with its price and time effect.
- RetentionA percentage withheld from each payment and released after handover or the defects period.
- Handover certificateA document evidencing the client’s acceptance of the works and start of the defects period.
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