Efficient management of contractual claims
SITUATION
A large mining company faced the need to negotiate the closing of a technology contract in advance.
CRITICAL ISSUE
When the contract was closed, the contractor claimed some services that, supposedly, had not been paid opportunely. This was not reflected in the client’s systems and represented a significant amount on the contract’s total budget.
REASONS
There was a discrepancy between the parties as regards the shipment and amounts to pay.
CAPABILITIES
The client needed technical support including the analysis of the payment status, invoices and effective payments of the last three years, to discern as regards the contractor’s claim’s validity.
We elaborated a methodology to review the purchase orders (PO), service entry sheets (SES), payment status (PS) and invoices connected to the ones claimed by the client. Additionally, we interviewed the contract administrators of both the client and the contractor. With the information we gained, we conducted the corresponding analysis to give technical recommendation.
The result of the analysis was an agreement between the client and the contractor based on our technical recommendation, for which only less than 30 % of the value claimed had to be paid. Additionally, and as a learnt lesson, it was determined that for the next contracts it would be necessary to establish shared standards as regards the manner to present the payment status.
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