Written by the PROFIX Consulting team · 8 min read
Developers spend a great deal of energy on sales velocity, launch timing and handover dates. The financial controls that run underneath the construction programme usually get less attention, even though that is the phase where the largest sums leave the business and the fewest people are watching them.
Why Construction Is a Control Blind Spot
A live construction project combines large and frequent payments, many contractors and subcontractors, constant design and scope changes, and decisions made quickly on site. The project team and the finance team often work in different places, with different information. Controls that were designed for a stable, repeatable operation struggle to keep up, and gaps tend to appear exactly where the money is moving fastest.
Six Control Areas That Matter Most
Tendering and contractor selection
Competitive bids, a documented evaluation against agreed criteria, and conflict-of-interest declarations protect both price and the integrity of the award decision.
Change and variation orders
Every change should be instructed in writing, assessed for cost and time before work starts, and approved at the right level. Verbal instructions are one of the most common sources of later disputes.
Progress payment certification
Payments should follow independently certified progress, with retention and advance payment recovery applied consistently, rather than contractor-submitted claims alone.
Cost-to-complete forecasting
A forecast set at launch and never revisited is a budget, not a forecast. It should include committed but unbilled costs, and be refreshed on a fixed cycle.
Project cost reporting
Site, quantity surveying and finance should work from a single reconciled view, with the project cost report tied back to the general ledger.
Related-party and subcontractor risk
Where contractors or suppliers are connected to the developer or its owners, pricing and approval need extra scrutiny. Subcontractor payment flows deserve the same attention as main contract payments.
“The problem is rarely one large decision. It is a hundred small approvals that each looked reasonable on the day, and no single view of what they add up to.”
— PROFIX Consulting
What Goes Wrong in Practice
The same patterns appear across projects of every size. Variations are agreed on site and documented weeks later, if at all. Progress is certified ahead of the work actually completed. Commitments are not recorded, so forecasts understate the final cost until the invoices arrive. And in smaller teams, the person who raises an order, approves it and releases the payment can be one and the same.
None of these requires bad intent. They are what happens when a fast-moving project outgrows controls that were never designed for it.
A Practical Control Framework
- Define approval limits and who may instruct a variation — Make it clear in writing who can authorise changes, and up to what value.
- Maintain a live commitments register — Record every order and contract when it is placed, not when the invoice arrives.
- Require independent certification before payment — Tie payments to progress verified by someone with no interest in the claim.
- Reconcile the project cost report to the ledger monthly — Differences between site records and accounting records are an early warning sign.
- Review the cost-to-complete forecast at fixed intervals — Require a written explanation for every material variance.
- Run an interim review at key milestones — Do not wait until practical completion to find out that controls were not working.
Questions a board or investor should be able to answer
- What is the total value of approved variations to date, and who approved them?
- How much of the contract value is committed but not yet invoiced?
- Who independently certifies progress before each payment?
- When was the cost-to-complete forecast last updated, and what changed?
- Does the project cost report reconcile to the accounting records?
Interim Reviews Beat End-of-Project Audits
A review carried out after handover can explain what went wrong, but it cannot recover money that has already been paid. A review carried out while the project is still under construction can still change the outcome, because variations can be challenged, certification can be tightened and forecasts can be corrected. For most developers, the best time to test construction controls is when the first major payments are being made.
Construction controls also connect to regulatory compliance. For how reported completion percentages affect escrow withdrawals, read our guide to RERA escrow compliance for Dubai developers.
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