- 1. Contracting in the Public Sector
- 2. Developing the Contract
- 3. Formalising the Contract
- 4. Entity Arrangements for Managing Contracts
- 5. Managing the Contract
- 6. Ending the Contract
- Managing the contract checklist
- Example contract management plan for simple procurements
- Example contract management plan for large/complex procurements
PDF version of guide [1.4MB]
PDF version of insert [207KB]
The most common way for a contract to end is when each party performs its obligations according to the terms of the contract, or when the contract term expires.
Contracts for the provision of goods may not specify an end date but obligations under the contract are usually considered to be complete following the delivery and acceptance of the last item(s) required under the contract. Acceptance implies that the goods delivered have met the agreed standards.
Contracts for the provision of services may specify an end date when all contract deliverables have to be provided. The contract ends if the services are delivered in line with contract standards by the due date. In both goods and services contracts, contract closure should be completed as soon as possible after all obligations have been met.
For contracts where all obligations have been met, when all legal, managerial and administrative actions have been finalised, it is considered that the contract is completed. For straightforward contracts there may be only a few tasks to be undertaken, for example, checking that all invoices have been paid and a final report received from the contractor. In complex contracts there will often be a need to follow detailed transition-out arrangements.
Steps and related tasks to be considered in completing the contract are set out in the checklist below.
Checklist for completing the contract
Verify all contractual obligations have been successfully met. This can include the need to:
- review the statement of contract deliverables to ensure that goods or services have met contract requirements;
- arrange for the return of all required documents, material, information and records used or generated during the contract that are the property of the acquiring entity;
- arrange the return of all equipment or other goods provided to the contractor and check that it is in a satisfactory condition;
- ensure to the extent possible, that any issues that may result in a claim against the acquiring entity are resolved;
- return any financial and other guarantees and securities, including any deeds to the appropriate party;
- record any intellectual property rights, including licences and the delivery by the contractor of all material expressions, information embodying intellectual property rights, any relevant documentation, technical data or reports in a form that enables access by the acquiring entity. Any instructions on the use of intellectual property should also be noted;
- make appropriate arrangements for the receipt and storage of material and documents returned by the contractor; and
- make all final payments payable under the contract.
Obtain all final reports and clearances from the contractor and make arrangements in regard to warranties available under the contract. This can include the need to:
- check the contract for any follow-up action that the acquiring entity is entitled to; and
- schedule any agreed checks or service available under the warranty in the contract.
Other areas that may need to be considered because they are legal rights and obligations that may survive after the contract has been discharged include:
- rights to recover money, indemnities and in some cases guarantees, intellectual property rights and handling information. These may have been covered by survivorship clauses in the contract.
Terminate all access arrangements. This can include the need to:
- ensure all access rights or arrangements to premises and systems are terminated or revoked, and
- ensure any security passes are returned or deactivated.
Undertake post contract analysis, evaluation and reporting. This may include the need to:
- evaluate contract performance;
- document lessons learned; and
- update policies or procedures, where required.
Where arrangements addressing the above matters are not fully set out in the contract, a contract variation or a separate agreement may need to be negotiated to address ownership, return of information, system compatibility and costs.
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