Compare different methods of identifying and assessing risk
Review the impacts of different approaches to risk allocation
Explore different Contract types to transfer risks
Consider the contractual techniques to ensure effective risk allocation
Review risk management techniques during the life of a contract
Target Audience
Contracts, Tendering, Purchasing, Procurement, and Project personnel
Contract Administration, Engineering, Operational, and Maintenance personnel
Risk, Claims, Financial, and Audit personnel
And all others who are involved in the planning, evaluation, preparation and management of tenders, specifications, awards, and contracts that cover the acquisition of materials, equipment, and services and who are in organizations whose leadership want high levels of competency in those involved in these activities
Course Outline
DAY 1: Types and Management of Risk
The Need for Contractual Relationships
Defining Risk
Categories of Risk for Both Sides of a Contract
Risk Assessment Process
Managing Risk
Qualifying Suppliers
Defining Internal Control
Proportionality of Control
DAY 2: Minimizing and Transferring Risk
Transferring risk through Contract Types
Firm Fixed Price or Lump Sum Contracts
Cost reimbursable Contracts
Incentive Contracts
Award-Fee Pricing Arrangements
Indemnities
Cross Indemnities
Insurance
DAY 3: Risk Related Terms & Conditions
External events
Force majeure
Strikes and other labour disputes
Risk and Title
Use of ICC Incoterms
Assignment and Novation
Other clauses that need to flow down to sub-contractors
Risks associated with Sub-Contractors
DAY 4: Dealing with Financial Risks
Controlling Risk Associated with Payments
Currency Risk
Economic Risk
Fraud and Corruption
Limiting or excluding liability
Distinctions between liability in contract, and the general law
“Gross negligence”
A review of some sample clauses from standard contracts, and other real documents
DAY 5: Remedies When Bad Stuff Happens
Mistakes and Misrepresentations
Impracticability of Performance
Remedies Generally
Types of Remedies
Liquated damages
Warranties
Cover
Discussion of real examples (delegates are encouraged to bring real or made up examples for discussion)