Internal Controls - Contracts
- All new contracts have been reviewed and approved in line with both Divisional and Group policies prior to customer agreement
- All contracts are reviewed for compliance against the Group Contract Policy and, where necessary, any deviations from this policy eg greater than 5 years in length or containing unlimited liability are authorised.
- Approval has been sought and obtained from the Group Director of Financial Control prior to applying long term contract accounting and appropriate accounting has been applied to all contracts
- Profit is only recognized on long term contracts when;
- 1) the outcome of the contract can be reliably measured, and
- 2) it is probable that economic benefit will flow to the company as a result of the contract, and
- 3) the stage of completion can be reliably measured
For any contracts under Life Cycle Management (LCM)
- 1)Are monthly LCM meetings held and attended by Senior Management?
- 2) Are costs to complete reviewed and reassessed each month and signed off?