Contract Intelligence

The average Fortune 1000 company actively manages tens of thousands of contracts at any one time. These dense, complex and often-changing documents touch every aspect of a business, impacting clients, employees and shareholders. Contracts also reflect the dynamic business environment of today – increasingly digital, global and diverse. And yet many corporations lack an organized, centralized method to store, review and analyze their diverse contract universe.

Cost-effectively find, understand and act upon enterprise contracts

Due to the critical importance of contracts, a growing number of organizations are modernizing their approach to these vital documents with FTI Technology’s Contract Intelligence service. Providing a cost-effective solution for a key component of contract lifecycle management, Contract Intelligence helps organizations better find, understand and act upon contracts to meet regulatory requirements, reduce risk and recognize greater business value. FTI Technology does this by combining leading-edge analytics technology, advanced workflow, and attorneys experienced in reviewing contracts.

Contract Intelligence enables and enhances business operations in a variety of scenarios, including:

• Conducting pre-merger contract diligence;
• Identifying post-merger business opportunities and synergies;
• Aligning contract terms with emerging regulations in the financial services, healthcare, pharmaceutical and insurance industries;
• Highlighting trends across contract obligations and risks;
• Identifying and analyzing leasing agreements for compliance with new accounting standards.

Why Choose FTI Contract Intelligence Services?

The Technology-Enabled Contract Intelligence Difference

FTI’s Contract Intelligence team leverages leading-edge analytics and artificial intelligence in place of labor-intensive processes to provide efficient contract collection and analysis. Rather than deploying armies of resources to manually identify and comb through documents, FTI experts use proprietary identification and culling technology to collect documents with a minimum amount of time and business disruption, then surface the relevant contract groups so that you can act on them quickly. Learn more about our technology-enabled solutions here.

Legal and Regulatory Expertise Reduces Risk

The Contract Intelligence team leverages deep legal and regulatory expertise to ensure a thorough and defensible process. Our global team includes contract process experts, forensic experts, corporate investigation specialists and technology professionals that have led some of the largest and most complex regulatory response, information governance, M&A, litigation and investigative engagements of the last decade. In addition, the Contract Intelligence service utilizes industry expertise across a number of vertical industries, including healthcare, financial services, retail, construction, energy and real estate.

Enhanced Workflows Ensure Quality While Reducing Costs

Custom solutions and workflows, designed by operational and subject matter experts, are executed by legal review teams that are specifically trained per engagement. Clients receive regular updates on review findings such as legal obligations, cost opportunities, risk exposure and any additional requirements – all driven by advanced analytics.

Contract Intelligence for M&A

The ability to analyze contracts becomes particularly important during change of control events. Companies going through transactions expose themselves to many risks and missed synergy opportunities by failing to fully understand the value of the data contained in their contracts. FTI’s Contract Intelligence for M&A services address these scenarios by enabling clients to use their data to look across the deal landscape and determine the best business decisions for the deal lifecycle. Services include:

Pre-merger contract diligence & valuation

• Analyze contract landscape to inform decisions regarding whether to proceed with the transaction
• Understand risks and liabilities contained in each party’s contracts
• Understand closing requirements and prioritize “day 1” contract activity based on assessment of services, assignability and change of control language
• Use Clean Teams to assess legal, operational and commercial synergy opportunities faster and analyze risks in areas where data cannot yet be shared without violating antitrust regulations or confidentiality agreements

Post-merger business opportunities and synergies

• Identify contracts that include automatic extension or renewal clauses or cost increases and payment obligations
• Perform a gap or risk analysis on damages, indemnifications and other contract penalty clauses
• Highlight opportunities for consolidation when there are multiple contracts for the same product or service or across different products, but with the same supplier
• Locating and benchmarking "most favored customer" clauses within contracts to drive value and optimize revenue

Contract Intelligence and LIBOR

The London Interbank Offered Rate (LIBOR) is embedded in an estimated $400 trillion of financial contracts, and panel banks will no longer be compelled by the UK Financial Conduct Authority (FCA) to submit rates to publish LIBOR beyond 2021.

The US Securities and Exchange Commission (SEC) and the FCA have advised public companies (and regulated entities) affected by LIBOR to assess their risk exposure, quantify the financial impact, develop remediation plans, and communicate material information to stakeholders. This transition will impact every LIBOR-based contract.

FTI Consulting has established a LIBOR Transition Task Force to work with clients, industry groups, law firms, and policy makers and to advise affected stakeholders on the most challenging issues related to the shift in reference rates. One of the crucial services performed by this task force is identifying and inventorying firmwide LIBOR exposure, which we accomplish via our Contract Intelligence service.

FTI’s contract intelligence experts utilize a structured analytics engine that identifies and analyzes LIBOR exposure within company’s contract universe. Working alongside legal counsel, FTI Consulting’s AI-driven solutions assess the current state of fallback provisions and prioritize contracts that require remediation or renegotiation.

Find out more about using FTI for LIBOR compliance by downloading the brochure here.

Contract Intelligence for Leases

New accounting rules (IFRS 16 issued by the International Accounting Standards Board in January, 2016 and ASC Topic 842 issued by the Financial Accounting Standards Board February, 2016) will come into effect in 2019 that require corporations to include all lease commitments, including operating leases, as part of their reported debt and assets. To achieve compliance, companies must have the ability to find, analyze and report on their entire enterprise lease universe – including leases ‘hidden’ in email attachments and other non-traditional locations.

The average Fortune 1000 company actively manages thousands of leases at any one time, yet many corporations lack an organized, centralized and automated method to collect and analyze their lease universe. Due to the critical importance of complying with the new accounting standards, a growing number of organizations are engaging FTI’s Contract Intelligence for Leases team to quickly understand and act upon their lease universe. Contact us to learn more about this timely service or download the brochure here.

Contract Intelligence for GDPR

The General Data Protection Regulation ("GDPR") went into effect in May of 2018 and requires organizations to meet a wide range of data privacy guidelines and prioritize data protection initiatives for all data residing in the EU, and all data that contains sensitive information for EU citizens. Compliance with the GDPR requires a substantial effort surrounding contracts, including workflows focused on the data found in and around an organization’s agreements with vendors, suppliers and affiliates. FTI can help corporations bring their contract universe into compliance with GDPR standards.

Services available include:

• Design of a contract analysis plan to assess current GDPR and related policy compliance
• Identification and determination of the location of all contracts that may involve data processing
• Collection of all relevant contracts and centrally organize them for scope and content analysis
• Collection of information from counterparties related to the nature of data processing and other elements not found within the "4 corners" of a contract
• Performance of review and extraction of contracts to identify GDPR compliance gaps in vendor relationships and policy deviations in model clauses
• Performance of review and extraction related to additional contract provisions, e.g. insurance policies (to ensure appropriate coverage and loss limits associated with data breaches)
• Identification of protected data across contract populations for evaluation against GDPR provisions such as right to be forgotten and privacy by design
• Delivery of extracted contract data in a structured manner to allow quick, reliable actions – either in direct response to the GDPR (e.g. data processing inventory, proof of adherence) or to develop strategies for downstream remediation
• Development of contract review templates compatible with GDPR requirements such as corporate privacy impact assessments and policy & procedure updates
• Reporting on contract volumes, locations, types and GDPR compliance risk levels