Contract Management

Overview

A contract is a legally binding agreement between two or more parties that outlines the terms and conditions of an arrangement — including the goods or services being exchanged, the responsibilities of each party, and the consequences of non-compliance. A well-drafted contract clearly answers who, what, when, where, and why, ensuring all parties understand their obligations before performance begins.

Contracts may take many forms, including:

• Master Services Agreements (MSAs)
• Memoranda of Understanding (MOUs)
• Letters of Agreement (LOAs)
• Purchase Orders (POs)
• Terms and Conditions
• Licenses

Any document requiring signature, specifically, in this case, those involving the purchase of goods or services, is generally considered a contract.

A signed contract may be required in place of, or in addition to, a Purchase Order. The need for a contract depends on factors such as the nature and complexity of the goods or services, total contract value, and the applicable procurement method. In some cases, a contract may be executed at the request of the second party. FIU requires a signed contract for all professional services and software purchases.

Individuals submitting contracts for approval, referred to as Contract Managers, must follow FIU’s standard business practices and procedures, as outlined in the Procurement Manual and the Contract Management Handbook.

All contracts for the purchase of goods and/or services must be submitted for approval through Total Contract Management (TCM). For step-by-step guidance in TCM, refer to the Total Contract Management System Manual. The Contract Process Checklist, found in the Contract Management Handbook is also a helpful resource for preparing and submitting a contract.

If the contract value is $150,000 or more and the appropriate procurement method is a cooperative/piggyback agreement or a formal competitive solicitation, the contract should not be initiated in Total Contract Manager (TCM). Refer instead to Procurement Methods on the Controller’s website for guidance.

Contract Management Lifecycle: Quick Reference Guide

Once it is determined that a contract is required for a purchase, and the appropriate individuals have access to TCM, the department may initiate a contract, thereby beginning the contract lifecycle.

The contract lifecycle encompasses all stages involved in managing a contract, as outlined below.

Stage 1. Contract Initiation

When a procurement need is identified, a contract is required if the supplier requests one or the purchase involves professional services or software. At this stage the following elements must be defined and agreed upon before proceeding.

• Scope of Work (SOW)
• Total Contract Value
• Procurement Method
• Supplier Registration

Stage 2. Gathering & Authoring

Once preliminary details are confirmed, the Contract Manager collects all necessary information and prepares the draft contract for submission and approval in Total Contract Manager (TCM).

Stage 3. Negotiation

Negotiation involves discussing and refining terms to reach a mutually agreeable contract. These terms may include pricing, deliverables, deadlines, contract curation and other key provisions.

Stage 4. Review and Approval

The Review and Approval stage of the contract Lifecycle takes place in TCM. At this point, the Contract Manager has gathered all necessary documentation and submits the contract for review and approval. Designated approvers review and approve the contract in TCM.

Stage 5. Execution

Once final approval is granted, the contract is prepared for signatures in TCM and executed via DocuSign.

Stage 6. Obligations and Compliance

Following the execution of a contract, it is strongly recommended that the FIU department responsible for overseeing the contract, conduct a collaborative internal review. This joint review helps identify all contractual obligations, assigns responsible parties, and establishes associated deadlines. It is the department’s responsibility to ensure that all obligations are met and that both parties remain in compliance with the agreed-upon terms throughout the life of the contract.

Stage 7. Amendment, Renewal, Expiration

An amendment is a formal change or modification made to an existing contract.

A contract renewal is the extension or continuation of the terms of an existing contract for an additional period after its original term has ended.

A contract expiration refers to the point at which a contract officially ends because its term or duration has been completed.

Details on each stage of the Contract Management Lifecycle can be found in the Contract Management Handbook.