What Is A Financial Close Agreement


In order to improve efficiency, it is necessary to review the entire closing process at the end of the month. If you optimize only parts of the process, you may miss what causes large bottlenecks, and can cause even more problems along the line. As noted in Chapter 5, the contract provides for certain legal systems (e.g. B in Spain), a limited period (up to six months or 18 months) after the signing of the contract, during which the private partner must organize the financing and execute the financial agreements. In some other legal systems and processes (usually negotiated or dialogue processes), bidders have already arranged the financing prior to the award of the contract and the financial conclusion occurs shortly after closing (the process can take from a few hours to several weeks depending on the circumstances). Chapter 1.7.3 presents a debate on these two different approaches. After the negotiation of the contract and the agreed signature, the bidder has sufficient time to conclude and conclude all third-party agreements. The successful bidder enters into agreements with the lender, subcontractors and other parties within a specified time frame and enters into a financial conclusion. Depending on the complexity and size of the project, it may take four to six months or more for a project to be completed financially. The checklist of the following models can be used by a contracting authority as it approaches the transition period between the financial close and the construction period.

We are impressed for companies that contract complete financial accounts in three days, but only if you do not give up accuracy for speed. The business world is based on facts and figures, and the fastest growing companies have a measurement process to continuously advance them. But in the middle of the stressful and stressful end of the month, measurement, improvement and strategy are set aside in many organizations. The financial clearing process includes controlling and reducing account balances before the accounting cycle closes. It starts by recording the log entry for each booking and activity, which leads to the verification phase. In addition, the “Annex” checklist (near design) of this subsection contains a model checklist, which can be followed by a contracting authority when managing a transition from financial proximity to construction.

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