Contract Procurement: Financial Risks & Mitigation Strategies

This case study delves into the financial and procurement risks associated with managing complex projects, particularly focusing on a scenario involving EPAS billing agenda. It highlights general risks such as procuring raw materials and financial risks stemming from inadequate hedging, as well as specific risks like potential capital shortfalls and inaccurate budgeting. The study also proposes risk mitigation actions based on best practices, including functionally limiting system use and ensuring adequate technical support. Furthermore, it examines a postponement in the distribution of critical elements of EPAS billing agenda, emphasizing the importance of vendor communication, evaluation reports, procurement plans, and contract management plans. Key areas of focus include tracking outcomes, managing workflows, advancing transparency over the EPAS budget, and increasing system functionality to address Medicare billing rejections. This assignment is available on Desklib, a platform offering a wide range of study resources for students.

Running head: CONTRACT AND PROCUREMENT
Contract and Procurement
Name of Student
Name of University
Author Note

1CONTRACT AND PROCUREMENT
Table of Contents
Discussion 3.....................................................................................................................................2
Discussion 4.....................................................................................................................................3
References........................................................................................................................................4

2CONTRACT AND PROCUREMENT
Discussion 3
The general financial and procurement risks for managing complex projects include:
 Procuring the sources of raw materials , due to the complex nature of the project
 Financial risk arising from inadequate hedging of revenue streams and finance costs(De
Marco, Rafele & Thaheem, 2015).
The specific financial risks that remained at the time the audit was written are:
 There was a potential capital shortfall and an associated cost pressure.
 There was a lack of proper management of strategic risk and how to implement them
 There was an inaccurate portrayal of budgeted expenses and costs as they were not drawn
from actual data and expected assurances
The possible risk mitigation actions that could be taken according to better practice guidelines
published by State Procurement Board of South Australia are as follows:
 The limiting system initially should be functionally used and the extent of learning and
familiarity should be limited to use the system
 Making sure the provision of complex projects are kept on site and there is adequate
provision of technical support who communicate competently.
 There should be a process for measuring the mitigation policies of the risk treatments so
that the risks can be reduced to a satisfactory level.

3CONTRACT AND PROCUREMENT
Discussion 4
In view of this case study there would be a postponement in the distribution of some
critical elements of EPAS billing agenda of the vendor Allscripts .The management was
successful in reaching an agreement with Allscripts on the terms of a reimbursement agreement
for the delay cost claim of around $13.25 million. Carestream was the favored vendor for
entreating a proposal procurement process. The management should communicate with the
vendor regarding the accessibility of vendor resources and establish their convenience.
Some of the key areas that the procurement manager should take into account to facilitate
successful outcomes in general are:
 Keeping evaluation reports to facilitate decision making processes
 Keeping a procurement plan ready that leads to consistently better value for money.
 Keeping a contract management plan ready to assist in performance monitoring and
evaluation(Niazi et al., 2016).
In view of this case study, the management should focus on the following key areas:
 Tracking and delivering outcomes against official governance preparations
 Recurrently managing the workflows
 Management should take steps to advance transparency and control over the EPAS
budget
 Increasing system functionality to enable the settlement of Medicare billing rejections.

4CONTRACT AND PROCUREMENT
References:
De Marco, A., Rafele, C., & Thaheem, M. J. (2015). Dynamic management of risk
contingency in complex design-build projects. Journal of Construction Engineering and
Management, 142(2), 04015080.
Niazi, M., Mahmood, S., Alshayeb, M., Qureshi, A. M., Faisal, K., & Cerpa, N. (2016).
Toward successful project management in global software development. International
Journal of Project Management, 34(8), 1553-1567.