Elucidate the Golden Rules for tracking of contracts for renewals, extension and closure.

Golden Rules for Tracking the Contract for Renewals, Extension and Closure Following are the golden rules which help in the effective tracking of the contracts: Know the place/storage of contracts The first thing you should do when preparing to track your contracts and their details is to be sure you know where all of your agreements are located. It might sound simple, but for far too many companies, contracts are not all stored in one location. Wherever you choose to store your contracts whether it's a filing cabinet, a shared drive, or using contract management software establish a system for organizing your repository so you can quickly find any agreement when it needs to be referenced or reviewed. This is a crucial beginning step that will impact everything else you do with your contracts throughout the life of each agreement. Determine the requirement of tracking Once each new agreement has been executed. Consider documenting every piece of important data that needs to be monitored. One need to create a strategy through the time to know that contract is expired and archived. Some of the common pieces of information to track and monitor during the contract lifecycle include: Deliverables and obligations End dates Opt-out/renegotiation windows Termination notice requirements High-risk clauses Compliance requirements Contract performance. Be proactive, not reactive Staying ahead of dates and deadlines and proactively looking for risks and opportunities during the contract monitoring process will help to remain in control of agreements and obligations. By regularly reviewing agreements marked as important or critical areas and the specific areas outlined in the previous section, one will have the best chance of catching any changes needed or corrections early rather than having to react to issues after they happen. The reason it's so important for contract managers to track deadlines well in advance is so there's time to assess the situation before making a decision about next steps. For example, when you know a contract end date is coming weeks or months ahead of time, you can work with other stakeholders to make an informed decision about renewing, renegotiating, or terminating the agreement. Keep stakeholders informed Tracking and monitoring agreements is a critical part of the contract management process, but it has to be made sure that the information gets to the appropriate parties. Contract management is a collaborative process, and effective contract managers communicate openly with stakeholders throughout the organization. Approaching deadlines and deliverables might be the first things that come to mind in terms of what to share, but the importance of contract performance shouldn't be ignored. Every agreement - whether it's a buy-side or a sell-side contract - represents a financial impact to the company, which is why department leaders and decision makers need as much information as possible to determine whether each contract is performing as expected. Streamline the process with contract management software Tracking and monitoring corporate agreements becomes much simpler and more streamlined when you incorporate contract management software into your process. Here are some of the ways contract management software can help you accomplish the recommendations in the previous sections: A contract repository gives you a centralized place to store and organize your agreements so you can always find the documents you need quickly. Custom reporting tools allow you to report on any data points in your contract portfolio and automatically send those insights to various parties on a recurring basis. Alerts and notifications help you stay ahead of upcoming contract dates so you have plenty of time to take strategic action at the appropriate time. Alternate Answer Golden Rules for Tracking the Contract for Renewals, Extension and Closure Following are the golden rules which help in the effective tracking of the contracts Storage of Contract: The storage of contract should be in a place where they are kept in safe custody and try to keep a copy of the Contract document readily available. In case, the number of contracts are on a higher side, online systems can be of great help. Arrange for the systems of reminders: Systems should be made in such a manner that ensuing activity is notified to the user well in advance in order to take necessary action. Classifications: Classifications of documents be made for the purpose of taking special care of the contracts whose stake are high and margin of error is very low. This will ensure timely action in case of important contracts. Inform Stakeholders in advance: Every organization have their own processes, long or short. Many a times, the authorities of various executives are also derived from their senior authority. For example: The Board Directors may authorize Company Secretary to execute contract on behalf of the company or Managing Director authorizing the Finance head for signing and executing the contract on behalf of the Company. Therefore, it is advisable, to give enough time to the other party for taking necessary approvals from their appropriate authority also to keep sufficient time for taking necessary approvals in your company.