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Cash FlowGlossary Term

Cash Price

A fixed, all-in rate quoted to a client that requires no further negotiation or adjustments. Subcontractors often offer a cash price to secure faster payment or simplified invoicing. It typically excludes extras like mobilisation, standby time, or material markups.

Related Terms

Backcharge

Cash Flow

A charge issued by an operator or general contractor to a subcontractor for costs incurred due to defective work, delays, or failure to meet contractual obligations.

Fuel Escalation Clause

Cash Flow

A contract provision allowing subcontractors to adjust their billing rates when fuel costs rise beyond an agreed threshold. It protects field crews and equipment operators from absorbing unexpected fuel price spikes. Without this clause, subcontractors bear the full risk of fuel cost increases mid-contract.

Unit Rate

Cash Flow

A pricing model where work is billed per unit completed (per meter drilled, per cubic meter hauled, per joint welded, etc.).

Contingent Payment

Cash Flow

Payment tied to a specific condition being met, such as project completion or client approval. Subcontractors must track these triggers carefully to invoice on time. Delayed conditions can create serious cash-flow gaps in the field.

Tax-Exempt Revenue Bonds

Cash Flow

Government-issued bonds that fund large infrastructure projects without federal tax on investor returns. For subcontractors, these bonds often finance the public projects you bid on, such as pipelines or facilities. Lower borrowing costs for project owners can mean steadier long-term contracts and more predictable payment cycles.

Phased Handover

Cash Flow

A structured process where completed sections of a project are formally transferred to the client in stages rather than all at once. Each phase triggers its own inspection, sign-off, and often a progress payment. Subcontractors must track completion milestones carefully to avoid billing delays.

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