A Guide to Enforcing Audit Rights, the Next Third-Party Frontier: Forestalling Problems, Documenting the Audit and Responding Appropriately (Part Three of Three)

Although third-party audit rights are only effective if the company designs and implements a solid plan for exercising them on a periodic basis, many companies still struggle with enforcing those rights and how, once an audit cycle is concluded, to respond to information the audit uncovered. The FCPA Report’s Guide to Enforcing Audit Rights provides practical guidance for every step of the audit-right enforcement process, from drafting a policy to remediation. This, the third article in our three-part series, discusses how companies can address common auditing challenges, how they should document the audit process and how they might respond to an audit’s results. The first article in the series discussed, in detail, drafting the company’s policy and outlined six steps a company should take prior to conducting an onsite audit of a third party. The second laid out a plan for conducting the actual onsite audit. See also “When and How Should Companies Include Audit Rights in Third-Party Contracts? (Part One of Three)” (Jul. 23, 2014); Part Two (Aug. 6, 2014); and Part Three (Aug. 20, 2014).

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