Certified in the Governance of Enterprise IT (CGEIT) — Question 35

An enterprise is contracting with an outsourcing partner for a long-term engagement. The BEST time for the enterprise to plan for the event of contract termination:

Answer options

• A. developing the initial contract.
• B. either party decides to terminate the contract.
• C. issues surface in the contractual relationship.
• D. planning for the contract as part of business continuity.

Correct answer: C

Explanation

The best time to prepare for contract termination is when issues arise in the contractual relationship, as this allows for proactive measures to be taken. Waiting until either party decides to terminate the contract or only planning during the initial contract development may lead to unpreparedness. Business continuity planning is essential, but it should include considerations for potential contract termination as issues develop.