​Most public and private sector organizations depend on third-party relationships to meet their goals. These multifaceted relationships are governed by contracts, which can be extremely complex and often times poorly designed and managed.

A lack of third-party vendor contract management processes and controls can lead to organizational risks resulting in brand or reputational damage and the loss of revenue.

We understand the complexities of vendor relationships, including: complex contractual agreements that may not be compliant with regulatory obligations, limited ability to assess large data sets to analyze, test and identify exceptions or management and oversight controls to adequately monitor adherence to contractual obligations.

Other common challenges surrounding third-party contractual relationships include:

  • Material and equipment vendors
  • Contract manufacturers
  • Third-party logistics providers
  • Business process outsource providers
  • Application service providers 
  • Lease hold management
  • Major construction projects (especially with large labour components)

How we can help

KPMG’s contract compliance services enables organizations across a wide range of industries the ability to analyze their contractual obligations with third parties, drawing on our multidisciplinary strengths from diverse disciplines – auditing, accounting, information risk management, among others. Our teams help to identify potential financial misreporting to ensure compliance in contractual relationships with business partners, resulting in potential collections or savings with significant return on investment.

Equipped with advanced data and analytics capabilities, our solutions involve tested technologies and machine learning that efficiently navigate the complexities of contract terms and conditions in today’s digital environment.

Our services involve:

  • Vendor and supplier reviews: Manage your vendor relationships by assessing compliance with various provisions of purchase agreements across the supply chain.
  • Long-term service reviews: Conduct Long-term Service Agreements (LTSA) reviews for various sectors including for renewables and transportation and identify key risk areas.
  • Accounts payable overpayment analysis and recovery: Improve your accounts-payable analysis and analyze transactions and identify potential overpayments, duplicate payments, and opportunities for risk mitigation.
  • Regulatory reporting and compliance of licensees: Ensure that third parties (including licensees and contractors) are in compliance with their obligations (e.g. reporting and regulatory requirements).
  • Project management clauses review: Assess whether your project management team and contractor are complying with key clauses related to project management.

Key benefits

Organizations that perform contract compliance can optimize relationships with other entities to improve business processes, maximize revenue, manage costs, address risks, strengthen relationships, and boost performance.

Key benefits for organizations that perform contract compliance

Insights and resources

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Contact our teams today to discuss how we can help embed contract compliance and vendor management to your processes. With over 400 contract compliance services professionals worldwide, our team delivers a range of services honing our tested methodologies, deep knowledge of vendor contracting models and approach that align with industry standards.

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