A computational method is developed in order to calculate compressible and incompressible flows by using implicit time marching method. The equations are preconditioned to permit solution of both compressible and incompressible flows. A cellbased, finite volume discretization is used in conjunction with AUSMPW scheme. Characteristic boundary conditions based on the eigensystem of the preconditioned equations are employed. Computational capabilities are demonstrated through computation of a wide variety of problems. Comparison of the calculations with available numerical data shows that the method is accurate, self-adaptive and stable for a wide range of Mach numbers.