Cause of delay in final account settlement

Abstract

The contractor is entitled to be paid of the final payment once the project is certified to be practically completed. There a many criticism on the final account for the construction project where the settlement is done in unreasonable time and far beyond the period as stipulated in the contract. The fact that Final Account is the sum agreed to be paid at the end of contract to the contractor by the owner, delay in Final Account closing should be avoided. Therefore, it is crucial to identify the significant cause for delay in closing the final account and method to mitigate the problem that lead to the cause of delay. The purpose of this study is to determine the significant cause for delay in final account closing, and to identify ways to mitigate the cause that contribute to delay of final account closing. The scope for this research is limited to industries practitioner with an experience of more than ten (10) years’ experience in private sector which is working in quantity surveying (QS) consultancy firm and contractor in Selangor and Kuala Lumpur. Questionnaire survey was distributed to collect the perspectives of the respondent on the significant cause for delay in final account closing and the best method to mitigate the cause that contribute to delay during final account settlement. The study revealed that the significant cause for delay in final account settlement is due to valuation or variation and the best method to mitigate the cause that contribute to delay in final account closing is proper track on record and documentation. Therefore, the findings and analysis of this research will help to assist various parties had a clear picture on the problem in closing the final account thus help them to find solution and assist them in closing the final account. In addition, this research will also help contract administrator to reduce potential dispute in final account settlement thus helps to reduce in delay of the preparation of the final account to ensure final account can be completed in timely manner.