The convergence and accuracy characteristics of the preconditioned incompressible Euler and Navier–Stokes equations are studied. An object-oriented C++ numerical code has been developed for solving the inviscid and viscous, steady, incompressible flows problems. The code is based on the cell-centred finite volume method. In this scheme, two-dimensional incompressible Euler and Navier–Stokes equations are modified by a robust artificial compressibility (AC) and a local preconditioning matrix of pressure-sensor type. The preconditioned equations are solved with the Jameson's numerical approach, i.e. artificial dissipation and artificial viscosity terms under the form of a fourth- and second-order derivative, respectively. An explicit four-stage Runge–Kutta integration algorithm is applied to obtain the steady-state condition. The computed results include the steady-state solution of flow past the NACA-hydrofoils and a circular cylinder in free stream, for which the numerical results are compared with numerical works of other researchers. Good agreement is observed. The effects of AC parameter, artificial viscosity and dissipation factor, and local preconditioning coefficient on convergence rate and solution accuracy are tested by computing flow over the NACA0012 hydrofoil. In addition, some important design criteria of a preconditioner, such as stiffness reduction, hyperbolicity, symmetrisability, accuracy preservation for M → 0, and M-property have been examined analytically.