A Contract Compliance Audit is a thorough examination that ensures both the media agencies are adhering to their contractual terms and conditions.
This audit goes beyond a surface-level review and delves into the details of the contract, ensuring that all obligations, deliverables, and financial terms are being met as agreed upon.
The primary goal is to protect advertisers from potential contractual breaches, misunderstandings, or any non-compliance from their media agencies that could potentially harm the efficiency and effectiveness of their media activities.
Through a meticulous examination of each clause and commitment, this audit aims to promote a transparent and responsible partnership between advertisers and the media agencies.
Challenges Addressed:
- Inconsistencies Between Contract and Actual Practices: A common challenge addressed by Contract Compliance Audits is the divergence between what is stipulated in the contract and the practices actually implemented. This discrepancy can stem from misunderstandings or oversight, often leading to conflicts that impede the smooth operation of media campaigns.
- Non-Compliance with Agreed-Upon Deliverables: The audit plays a crucial role in ensuring that all deliverables, as agreed upon in the contract, are fully met. Non-compliance in this aspect can significantly affect campaign outcomes, leading to dissatisfaction and potential financial losses for either the advertiser or the media agency.
- Erosion of Trust Between Advertiser and Media Agency: Trust is the cornerstone of any advertiser-media agency relationship. Contract Compliance Audits help in identifying and addressing issues that could erode this trust, such as miscommunication or failure to meet contractual obligations. By rectifying these issues, the audit aids in maintaining a harmonious and productive partnership.
What This Audit Covers:
- Scope of Work (Actual Delivery vs. Contract)
- Media Agency Remuneration (Actual vs. Contract)
- Use of Inventory Media (Actual Delivery vs. Contract)
- Unbilled Media (Actual Delivery vs. Contract)
- Non-Working Media Charges (Actual Delivery vs. Contract)
- Additional Comments
- Our Recommendations for Improvement
The Process & Timeline:
- ONBOARDING (Week 1): Discuss the project and explain the scope of work to both the local client and the local media agency.
- DATA COLLECTION (Week 2-4): Collect all required existing media documents and detailed media data for all media investments, for both digital and traditional media channels, using our secured cloud content management platform.
- MEDIA AGENCY INVOICES ANALYSIS (Week 5-8): Analyse the media agency invoices against actual delivery, post-campaign reports, purchase orders, and best practices.
- INTERVIEWS (Week 9-10): Conduct set of 'context seeking' interviews with the key stakeholders (agency and advertiser separately) and process additional information received following the run of interviews.
- REPORTING (Week 11-12): Prepare audit report, collect feedback and comments from both the local advertiser and the local media agency + delivery of the final report + presentation of the final report.
Benefits:
- Identification and Rectification of Compliance Issues: A Contract Compliance Audit serves as a proactive measure to identify and address any discrepancies or breaches in adherence to the contract. By catching these issues early, it prevents them from escalating into more significant problems, thus safeguarding both parties against potential legal complications and financial losses.
- Assurance of Value Delivery as Per Contractual Terms: This audit meticulously verifies that all services and deliverables promised in the contract are being duly provided. It ensures that the advertiser receives the full value they have paid for, and that the media agency is fulfilling its obligations efficiently and effectively, in accordance with the agreed-upon terms.
- Fostering of Trust and Long-Term Partnership Between Advertiser and Agency: Through the thorough and transparent process of a Contract Compliance Audit, a foundation of trust is built between the advertiser and the media agency. This trust not only strengthens their current working relationship but also lays the groundwork for a durable and mutually beneficial partnership in the long term. The audit's emphasis on fairness and accountability plays a crucial role in maintaining a positive and collaborative business relationship.
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