Down the stairs from where your friends are waiting is Sephiroth, and the final battle against him can be very difficult or very easy. You'll choose two other party members to accompany Cloud down the stairs. After about every other step, you'll have to fight a battle against a fairly tough monster. The Iron Giants can be morphed into an Escort Guard, so try to get at least one. When you reach the bottom of the stairs, you'll be forced into your final fight against Jenova. She's not really that difficult, especially if you have Knights, so try to kill her as quickly as possible. Don't worry about conserving MP, you'll have a chance to use some items before the final battle. If you win, you get a large amount of EXP, but if you lose, she'll cast Ultima on you and leave the battle, giving you 0 EXP. So try not to lose. Now, after Jenova is dispatched, you'll fall down to the core of the planet, where you and your whole group begin floating in front of Sephiroth, who in turn is floating in front of Holy. You'll discover that the reason Holy hasn't attempted to stop Meteor yet is because Sephiroth is blocking it. For the sake of the Planet, you decide to fight Sephiroth. Now, you are told to make 2 parties. Here's what I recommend for Party 1.
CloudUltimate Weapon, Escort Guard, Ribbon. For materia, give him enough HP and MP pluses to max out his stats, Then give him Knights (If you have it. if not, give him Bahamut Zero or lvl.2 Comet.), paried with a mastered MP Turbo. Now, if you can manage this, it will make this battle a peice of cake. Give him a Master Summon, paired with a Mastered MP Absorb. Also, give him a Mime.
YuffieConformer, Minerva Band, Ribbon. For Materia, give her enough HP and MP pluses to max out her stats. Then give her a Mime, or a master command. Also, if you possibly can, give her a 4x Cut.
BarretMissing Score, Imperial Band, Ribbon. For Materia, give him as many high level materia as you can on his weapon. These will boost his attack. Then, give him as many HP and MP pluses as it takes to max out his stats. Then, give him a Mime, a 4x cut (if you can), and an Enemy Skills. You might also want to consider giving him a Final Attack paired with Pheonix, in case you run into any difficulties.
Now, you have to make a second party. Despite what you may have heard, you don't need to ever use this second party in battle to win. If you do, by accident, switch to your second party, make sure they have their Ultimate Weapons equipped, so they can survive long enough to switch back to the other party. Other than that, don't bother equiping them with any materia.
Now that everyone's set, you're ready to take on Sephiroth. In his first form, he doesn't attack very hard, but he can be very hard to destroy, because you must destroy all his body parts before you can damage the center section. The quickest way to finish him off is to cast Knights on him one, and then mime it. He'll be dead in no time flat.The other method is to just keep consistently attacking him until he falls. It can take quite a while, but it will work in the end.
His second form, however, is a little bit tougher. He starts off the battle by casting Wall on himself. This reduces all the damage done by your physical and magical attacks by half. Again, the quickest way to end this battle is cast Knights and then Mime it, but it isn't the only way. The first time through the game, I beat him without Knights. Instead I used a simple little combo on Cloud. Spehiroth had killed my other 2 party members, so it was just me and him. early on in the battle, Barret had cast Big Guard, and Yuffie had given Cloud a Hero Drink, so his attack was maxed out. Now, I had Added Cut paired with Contain, and a second Contain paired with MP Absorb. I just kept casting Flare for 6,000 damage, and Cloud would attack for about 8,000. Once Sephiroth is dead, you'll climb back out of the core, but Sephiroth will summon Cloud one last time for a final confrontation. Don't worry, it is immposible to lose this battle. Even if you do nothing and let Sephiroth attack you, Cloud will counter-attack and kill him. Now, you get the reward you've been waiting for this entire game. The final video. Sit back and enjoy it, and don't forget to watch all the way throught the credits. There's another video at the end of them that shows what happens to the Planet. Well, that's pretty much it. I hope this walkthrough was helpful to you, and increased your enjoyment of the game.