Contract Lifecycle Management

These days, it is a common business practice for organizations to regularly rely on legal agreements to get important business tasks done. From vendor-related processes to supply chain and procurement, from staff recruitment and employment to facility management and real estate matters, etc., contracts play a pivotal role in how we get work done. However, successful contracts don’t happen based on set-and-forget principles. Rather, it is necessary to manage and track every stage of a contract’s lifecycle to achieve the best performance and compliance. Traditionally, this process was managed through manual paper systems that left too much room for errors….

If your business has been in operation for a number of years, the chances are high that you must have participated in a number of contracts over the years. But if you were asked to provide some contract information from a couple of years back, how long would it take to find that information? Can you pinpoint for sure your best and worst performing contracts? On closer scrutiny is the  answer you just gave accurate? Have you made more profits or losses from contracts so far? As more years roll by and your business continues to sign even more contracts,…

Lease accounting processes are now required to comply with new Accounting Standards Update (ASU) under the FASB 842(US) and IFRS 16(European) standards. This would fundamentally change the lease accounting practices in ways not seen in decades. First to be impacted are public entities (starting 1/1/2019) and then all entities public and private (starting 1/1/2020). They will be required to change the accounting for leased assets such as buildings, vehicles, furniture and fixtures, office equipment, rolling stock, aircraft and manufacturing equipment to name a few. Who in your or any organization has a definitive list of all leased assets? What about…

There are two related accounting standard regulations for lease capitalization which will go into effect as of the beginning of 2019. One is ASC 842 which stands for Accounting Standard Codification Topic 842, Leases (ASC 842). ASC 842 is developed by FASB which stands for Financial Accounting Standards Board and used to be called FASB 13. ASC 842 follows the US GAAP. FASB and GASG (Governmental Accounting Standard Board) and a part of Financial Accounting Foundation (FAF) organization. ASC 842 applies to the companies in the United States. The other standard is the European counterpart of ASC 842 which is…

Contracts and agreements are an important part of any company’s operations. Some address the legal obligations between the company and other parties and some relate to purchase/sale of products and services among other things. Since contracts are negotiated individually and changes are made on a case by case basis, they require legal reviews and management approvals.  Once a contract is in place, it needs to be monitored for compliance, expiration and renewals and triggered events as required. Amendments and subcontracts need to be generated as needed over the life of a contract. Despite the importance of the contract management process,…

As the electronic signature solutions become more popular, there are questions regarding their integrity as stand-alone applications.  If the e-signature process is not integrated with the contract management process, what is the guarantee that someone has not intercepted an email and simply e-signed the document without the knowledge of the real signatory? Integrate Electronic Signatures into CLM In a well-integrated process, the integrity concerns are significantly diminished. As Axxerion has demonstrated with its integration with DocuSign, the contract management workflow guarantees that the approval process has been in place and documented before a document becomes available for e-signature. For example,…

Many companies use consultants for a variety of projects and tasks.  Consultants may be teams from the larger consulting companies all the way to individuals working as single-person consultants. The consulting work may be done on the premises or off site at the consultants offices or a combination of the two approaches.  While consultants play vital roles for many companies, traditionally they do pose their own set of unique issues and challenges for the finance, legal and human resources departments as explained below.  Taking advantage of some of the new contract lifecycle management technologies would help alleviate many of these…