diff --git a/compiler/passes/src/flattening/flatten_program.rs b/compiler/passes/src/flattening/flatten_program.rs
index d6290de9a7..064b7995a3 100644
--- a/compiler/passes/src/flattening/flatten_program.rs
+++ b/compiler/passes/src/flattening/flatten_program.rs
@@ -16,7 +16,7 @@
 
 use crate::Flattener;
 
-use leo_ast::{Function, ProgramReconstructor, ProgramScope, Statement, StatementReconstructor};
+use leo_ast::{Finalize, Function, ProgramReconstructor, ProgramScope, Statement, StatementReconstructor};
 
 impl ProgramReconstructor for Flattener<'_> {
     /// Flattens a program scope.
@@ -59,7 +59,23 @@ impl ProgramReconstructor for Flattener<'_> {
             output: function.output,
             output_type: function.output_type,
             block,
-            finalize: function.finalize,
+            finalize: function.finalize.map(|finalize| {
+                // Set the `is_finalize` flag before reconstructing the finalize block.
+                self.is_finalize = true;
+                // Reconstruct the finalize block.
+                let finalize = Finalize {
+                    identifier: finalize.identifier,
+                    input: finalize.input,
+                    output: finalize.output,
+                    output_type: finalize.output_type,
+                    block: self.reconstruct_block(finalize.block).0,
+                    span: finalize.span,
+                    id: finalize.id,
+                };
+                // Reset the `is_finalize` flag.
+                self.is_finalize = false;
+                finalize
+            }),
             span: function.span,
             id: function.id,
         }
diff --git a/compiler/passes/src/flattening/flatten_statement.rs b/compiler/passes/src/flattening/flatten_statement.rs
index 9a47421112..ca5bdbccc4 100644
--- a/compiler/passes/src/flattening/flatten_statement.rs
+++ b/compiler/passes/src/flattening/flatten_statement.rs
@@ -61,6 +61,11 @@ impl StatementReconstructor for Flattener<'_> {
     fn reconstruct_assert(&mut self, input: AssertStatement) -> (Statement, Self::AdditionalOutput) {
         let mut statements = Vec::new();
 
+        // If traversing a `finalize` block, return the assert as is.
+        if self.is_finalize {
+            return (Statement::Assert(input), statements);
+        }
+
         // Flatten the arguments of the assert statement.
         let assert = AssertStatement {
             span: input.span,
@@ -222,6 +227,26 @@ impl StatementReconstructor for Flattener<'_> {
     fn reconstruct_conditional(&mut self, conditional: ConditionalStatement) -> (Statement, Self::AdditionalOutput) {
         let mut statements = Vec::with_capacity(conditional.then.statements.len());
 
+        // If traversing a `finalize` block, only reconstruct the if and else blocks of the conditional statement.
+        if self.is_finalize {
+            let then_block = self.reconstruct_block(conditional.then).0;
+            let otherwise_block = conditional.otherwise.map(|statement| match *statement {
+                Statement::Block(block) => Box::new(Statement::Block(self.reconstruct_block(block).0)),
+                _ => unreachable!("Parsing guarantees that the `otherwise` is always a `Block`"),
+            });
+
+            return (
+                Statement::Conditional(ConditionalStatement {
+                    condition: conditional.condition,
+                    then: then_block,
+                    otherwise: otherwise_block,
+                    span: conditional.span,
+                    id: conditional.id,
+                }),
+                statements,
+            );
+        }
+
         // Add condition to the condition stack.
         self.condition_stack.push(conditional.condition.clone());
 
@@ -269,6 +294,10 @@ impl StatementReconstructor for Flattener<'_> {
     /// Transforms a return statement into an empty block statement.
     /// Stores the arguments to the return statement, which are later folded into a single return statement at the end of the function.
     fn reconstruct_return(&mut self, input: ReturnStatement) -> (Statement, Self::AdditionalOutput) {
+        // If traversing a `finalize` block, return as is.
+        if self.is_finalize {
+            return (Statement::Return(input), Default::default());
+        }
         // Construct the associated guard.
         let guard = self.construct_guard();
 
diff --git a/compiler/passes/src/flattening/flattener.rs b/compiler/passes/src/flattening/flattener.rs
index 4e51de0397..772b4a1c2e 100644
--- a/compiler/passes/src/flattening/flattener.rs
+++ b/compiler/passes/src/flattening/flattener.rs
@@ -67,6 +67,8 @@ pub struct Flattener<'a> {
     pub(crate) returns: Vec<(Option<Expression>, ReturnStatement)>,
     /// The program name.
     pub(crate) program: Option<Symbol>,
+    /// Whether we are currently traversing a `finalize` block.
+    pub(crate) is_finalize: bool,
 }
 
 impl<'a> Flattener<'a> {
@@ -84,6 +86,7 @@ impl<'a> Flattener<'a> {
             condition_stack: Vec::new(),
             returns: Vec::new(),
             program: None,
+            is_finalize: false,
         }
     }