As an In-House Counsel or legal team member, there are a few key details that you should focus on when reviewing contracts and contract risks. Sometimes the simplest dates and costs are the most overlooked pieces of a contract. To help you do your job successfully, we gathered four unknown risks to look for in your contracts. Review and see which risks are most pertinent to your business.
1. Review key renewal dates for sales opportunities
Dates can be an easy detail to miss. Especially when there is a key timeframe associated with a renewal like a 30 or 60 day notice prior to contract renewal. Staying on top of your key renewal dates will keep your company from missing out on an important issue with a key customer. Make sure you have these dates easily accessible when the CEO or the board comes asking.
2. Find negotiated contracts and identify any unknown legal risk
Most companies have a large number of different negotiated contracts and the part of the role of the legal team is to understand how each one is different and unique. Finding each contract and thoroughly assessing any risks can be difficult when you have thousands of pages to process. But when you know what to look for or can easily search through all of your contracts, it is much easier to hone in on any potential risks or loopholes.
3. Review payment terms for any unnecessary costs
Staying on top of complex payment terms and certain fulfillments is a key part of working with the finance team. When you’re sorting through your contracts, make a special note of the payment terms because each contract can be different. Missing a payment date or term could put your contract with additional risk.
4. Breakdown time inefficiencies in contract review
Here’s when you assess your contract review process and suggest any changes that can help you find answers faster. When you’re asked a question by the board or any executive, how long does it take you to find that answer? This can create a risk of its own . Having a tool like LinkSquares, that can instantly search through all your contracts can really help you stay on top of your contract database.
We've been able to review just a few of the unknown or increased contract risks that can be found in customer agreements. This is a larger part of legal risk assessment series we are working on. Follow @linksquares for more posts when they are released!