Course Overview

One of the major functions of contracting is to ensure that risks to owners and contractor are identified and managed in a
way that both parties are satisfied with the project outcome. While a contract cannot, of itself, make risk “go away”, it can,
and should, identify the risks, determine who is responsible for managing each individual risk, and for the consequences
should the risk occur. We have developed this interesting and fast-paced seminar to provide participants with:

  • Critical understandings of the risk mitigation process.
  • Knowledge to move contracts from the tactical to a more important strategic focus.
  • Ability to identify risks that can arise.
  • Skills in allocating contract and procurement risk.
  • Examples of Contract Terms and Conditions which allocate risk.

Course Objectives

Upon completion of the course, the trainee will be able to:

  • Provide an understanding of how risk arises
  • Compare different methods of identifying and assessing risk
  • Review the impacts of different approaches to risk allocation
  • Explore different contract types to transfer risks
  • Consider the contractual techniques to ensure effective risk allocation
  • Increased understanding of risk
  • Better ability to allocate risk, and to select the appropriate contractual regime to achieve the organization’s goals.
  • Develop risk identification and assessment skills
  • Heighten understanding of the alternative methods of allocating risk
  • Improve understanding of different approaches to managing risk during a contract
  • Improve the ability to reduce the negative impact of poorly-managed risk on a project or a company.

Who Should Attend

Contracts, Tendering, Purchasing, Procurement, and Project personnel, Contract Administration, Engineering, Operational,
and Maintenance personnel, Risk, Claims, Financial, and Audit personnel

Course Content

Module 01 Types and Management of Risk
1.1 The Need for Contractual Relationships
1.2 Defining Risk
1.3 Categories of R for Both Sides of a Contract
1.4 Risk Assessment Process
1.5 Managing Risk
1.6 Qualifying Suppliers
1.7 Defining Internal Control
1.8 Proportionality of Control

Module 02 Minimizing and Transferring Risks
2.1 Transferring Risk Through Contract Types
2.2 Firm Fixed Price or Lump Sum Contracts
2.3 Cost reimburseable Contracts
2.4 Incentive Contracts
2.5 Award-Fee Pricing Arrangements
2.6 Indemnities
2.7 Cross Indemnities
2.8 Insurance

Module 03 Risk Related Terms & Conditions
3.1 External events
3.2 Force majeure
3.3 Strikes and other labour disputes
3.4 Risk and Title
3.5 Use of ICC Incoterms
3.6 Assignment and Novation
3.7 Clauses that Flow Down to Sub-contractors
3.8 Risks Associated with Sub-Contractors

Module 04 Dealing with Financial Risks
4.1 Controlling Risk Associated with Payments
4.2 Currency Risk
4.3 Economic Risk
4.4 Fraud and Corruption
4.5 Limiting or excluding liability
4.6 Distinctions between liability in contract, and the general law
4.7 “Gross negligence”
4.8 A review of some sample clauses from standard

Module 05 Remedies When Bad Stuff Happens
5.1 Mistakes and Misrepresentations
5.2 Impracticability of Performance
5.3 Remedies Generally
5.4 Types o Remedies
5.5 Liquated damages
5.6 Warranties
5.7 Cover

Module 06 Risk Management Framework and Planning
6.1 Key definitions
6.2 Project Management Body Of Knowledge (PMBOK) – 6
risk management processes
6.3 Project risk management goal
6.4 Purpose of risk management
6.5 Benefits of risk management
6.6 Responsibilities in risk management

6.7 Integrating risk management into the project management process

6.8 Components of risk
6.9 Types of risk

Module 07 Risk Response Control
7.1 Risk management plan execution
7.2 Risk response control tools
7.3 Risk response control guidelines
7.4 Risk strategy execution
7.5 Evaluating risk response results
7.6 Risk documentation