How to prepare and agree a construction final account

Step-by-step guide

1. 1. Confirm the completion event and deadlines

   Your contract completion may differ from completion of the whole project. Check which event controls defects, retention and delay provisions.

   Record outstanding work, certificates, handover requirements and agreed access for rectification. Do not treat a site departure date as a certificate.

   Read practical completion for terminology. NEC explains Completion and defects for its ECC form; your contract must be checked separately.

2. 2. Reconcile the final account

   Start from the contract price or valuation basis. List agreed changes, disputed changes, other adjustments, previous payments and retention separately.

   For each item, show your figure, the other assessment, the difference and the evidence. Distinguish gross entitlement from the net balance requested.

   Keep this separate from your internal cost value reconciliation (CVR), which compares the job's value and costs. A forecast margin does not establish what the other party owes.

   Check VAT and other accounting treatment with the appropriate adviser. A commercial reconciliation should not silently mix tax-inclusive and tax-exclusive figures.

   For a homeowner checking the builder’s final bill, start with the agreed price and add or subtract properly valued changes. Remove replaced allowances.

   Compare the resulting account with completion records and the agreed scope. Identify incomplete work and defects separately, with their evidence and the applicable procedure.

   For illustration, a £60,000 agreement plus £4,000 of agreed changes gives £64,000. If £55,000 has been paid, the arithmetic balance is £9,000.

   That calculation alone does not establish when payment is due or resolve disputed items. Check the final-payment and notice procedure.

   Our Final account preparation and assessment service uses this reconciliation to prepare and agree the closing valuation. Where items remain contested, Final account dispute assessment and response examine their basis and the evidence needed to resolve them.

3. 3. Separate retention and payment balances

   List each release condition and its evidence, then the applicable payment procedure. An assumed percentage or standard main-contract date may be wrong.

   Record defects raised, responsibility disputed, access offered and completion of remedial work. Preserve correspondence about refusals or delays in access.

   Do not assume every remaining defect permits withholding all retention. The contract, facts and applicable payment rules need examination.

4. 4. Check the settlement before agreeing

   Check whether the proposal settles one item, the whole account or wider liabilities. Identify excluded issues and any continuing obligations.

   Record the amount, payment deadline, conditions and parties. Obtain advice on unclear release wording before signing.

   A final account submission and a binding settlement are different events. This is general learning for the UK construction industry. Check your governing law, contract form and amendments. Statutory procedures differ across England, Wales, Scotland and Northern Ireland.

   Before final payment, reconcile previous payments, retention if agreed, remaining deliverables and any proposed release of claims. A defect does not automatically justify withholding the entire balance.

   Reconcile the agreed price, changes and payments before assessing the remaining balance. Keep contested items separate from agreed amounts.

   If the issue concerns an increased quotation rather than closing reconciliation, see builder charging more than the quote.

Before you finish: Reconcile the final figure to payments and retention without duplication. Confirm who may approve the settlement and what it releases.

Worked example